The money will be recovered by city government’s Hamilton Economic Development Corporation over time when the chamber and HEDC sell gift certificates for the businesses to the public over the next year or so, beginning in the coming weeks.
The gift certificates may have redeemable dates two months or more in the future so the businesses can hold onto the money awhile during the crisis, before providing the goods and services to customers.
Some 78 businesses requested more than $700,000, Bates said. Not all businesses that applied will receive money. About five businesses did not qualify because they were outside Hamilton, Bates said.
The money came from the city’s budget-stabilization fund, which city government had built up to $2 million in recent years.
Amounts businesses will receive are “all over the board,” Bates said. “Some people got what they asked for, some got half of what they asked for.”
Bates did not immediately name businesses receiving money, because they had not yet been informed.
“The interest from the businesses obviously has been very strong,” he said.
Small businesses, with restaurants and retail targeted, had to fill out an application that had about six questions, Bates said.
A committee that included banking institutions, financial organizations, non-profit organizations and businesses reviewed the applications and determined the awards each company got.
“The committee really judged it on the merit of what the application said and what they were asking for the money for,” Bates said. “It was really targeted at keeping employees on staff and capital expenditures that would put them out of business during the virus.”
Before businesses can receive payments, they must submit W-9 forms, which are required by the Internal Revenue Service.
The chamber and HEDC will “buy” gift certificates in the amount of each company’s award. The paper certificates that are sold to customers will probably be in $10 denominations.
City council unanimously voted to waive the requirement it consider legislation at two separate meetings before voting 7-0 to approve the grant to HEDC, a city committee.
“I just want to thank the city manager and his team for putting together this idea, which will help our local businesses,” Mayor Pat Moeller said before the vote. “We hope this accomplishes a lot, and is really thinking out of the box during these difficult times to help our small businesses.”
Bates said he believed it was City Manager Joshua Smith’s idea. He said other communities have been calling to ask about the program. It’s not the only innovative program area entities have used for development: The Hamilton Community Foundation has repaid student debt for young people moving into the community.
The certificates will be sold for perhaps a year, starting in a few weeks, through a website whose address has not yet been announced. The gift certificates may have redeemable dates a couple months or more in the future, so the businesses can hold onto the money for a while before providing the products or services.
“The purpose of the gift certificates is for some of that money to be recouped after the covid-19 is over, and the businesses are starting to get back on their feet again,” Bates said.
Bates offered this overall advice to local companies: “The businesses that are the most creative are going to ride this out just fine.”
Some are doing a lot more business online than ever.
“I know of one trainer who — you know the gyms are all closed? — he’s doing trainings online for a fee, and he’s got clients on the East and West coasts right now.”