ITHACA, N.Y. — Local leaders are mobilizing to help buffer against the economic fallout of the COVID-19 crisis, rolling out The Ithaca/Tompkins County COVID-19 Small Business Resilience Fund which will extend forgivable mirco-loans for small businesses, while the mayor has donated a portion of his salary back to the city.
The City of Ithaca —with its economy so heavily reliant on students and tourists — is bracing for major revenue shortfalls this year, leading to amended budgets and departments being asked to put together contingency plans. Rather than waiting to hear how big the hole might be, and no clear indication of what federal support could be on the way, city officials are being proactive.
Mayor Svante Myrick requested his salary be reduced by 10% to help lighten the city’s load. While the mayor does not have the authority to change his own salary, the suggestion was made instead to donate that portion. The City of Ithaca Mayor’s salary is $58,000 annually.
“We are projecting huge revenue shortfall, because no hotels, no restaurants, no bars. Our best guess is we will be short anywhere from $4 to $13 million,” Myrick told the Ithaca Voice Wednesday. “Which means, unless the feds come through for municipalities like they did for large corporations, there is going to be a lot of belt-tightening. So, I figured I should tighten my belt first”
The third-term Democrat said the move simply made sense to him, looking at Cornell University making similar moves for high-level staff and the practice being fairly common in the corporate world.
The city and Tompkins County partnered with Tompkins County Development Corporation, Ithaca Urban Renewal Agency, Cornell University, Tompkins County Area Development, the Tompkins Chamber of Commerce, the Downtown Ithaca Alliance and the Tompkins County Workforce Investment Board to set up the fund.
The fund will be administered by Alternative Federal Credit Union and has been capitalized at $390,000.
“We know that the federal efforts have been good but not enough for small businesses. A lot of business owners are trying to decide if they should tough this out or close and we wanted to do what we could to make this easier for each interest,” said Myrick.
Cornell University contributed $100,000 to help capitalize the fund, recognizing the need to help the local economy usually supported by its student body.
“Ithaca is one of the best small cities in America, in part because of its beauty, diversity, and strong community spirit,” said Cornell University President Martha E. Pollack. “Our small businesses are the backbone of our local life, drawing people to Ithaca from around the region, and serving as employers and economic drivers, as well as contributors to the common good. Cornell University is pleased to support the Small Business Resilience Fund and we stand united with all who are working to help to address our community’s pressing needs in this challenging time.”
The fund will extend micro-loans of up to $5,000 to small businesses being impacted by COVID-19. The loans will carry a zero-interest rate, an 18-month repayment term, and will be forgiven for businesses open and in operation on December 1, 2020 and have complied with the program rules, according to a statement from the City of Ithaca Office of Economic Development
- Principal place of business must be located within Tompkins County.
- Business must have been in operation on or prior to February 15, 2020.
- Businesses must have 25 or fewer employees.
- Businesses must have $2.5 million or less in annual gross revenues.
- Business must meet one of the following criteria:
- Business is public-facing (e.g. retail, coffee shop, food service) and is directly impacted by new public health requirements related to the COVID-19 pandemic.
- Business has experienced 25% or more decline in revenues since March 1, 2020 due to the COVID-19 pandemic.
The primary goal of the fund is to provide emergency relief to help business owners retain their businesses and their employees. The fund seeks to be a bridge of support before additional state and federal resources become available and mandated social distancing is relaxed. Among other priorities, the fund aims to support ground-floor, storefront businesses open to the general public and businesses located in established commercial districts, according to the fund’s press release Wednesday.
Interested businesses, which must be located within Tompkins County, can visit the City of Ithaca’s Website for COVID-19 Business Resources or bit.ly.coicovid to download the full program guidelines and information about how to apply.