Kane County trying to simplify process to get federal COVID-19 money to local businesses

Posted11/6/2020 5:00 AM

Kane County officials have less than 60 days to spend about $8 million in federal COVID-19 relief funds earmarked to help local businesses before the county must return the cash to the U.S. Treasury Department.

And, county officials say they may be willing to ease requirements established to help prevent fraud to get it done.


The county has received $93 million in pandemic funds, but has struggled to get assistance money to local businesses.

While most of that money will be spent on county and municipal responses, it set aside $8 million for small businesses. Businesses were eligible for grants of up to $20,000, depending on how long they'd been operating.

However, the county received only 250 applications and rejected about 50 for not including expenses, such as rent and utilities, that qualified for the federal dollars. There were 94 valid applications with requests totaling $1.5 million. About half the remaining applications are in limbo because they haven't been able to provide 18 months of financial statements to show losses suffered because of pandemic business restrictions and shutdown.

"The reason we set financial criteria in the original process was to avoid fraud," said Kane County Board Member John Hoscheit, who leads the committee overseeing the funds. "If they can't produce a tax return, that's a challenge. If we have recipients that weren't genuine businesses, that puts a challenge on us. If we are providing funds to entities, and we get audited as to whether we used the money appropriately ..."

Hoscheit didn't complete the thought, but the message was clear. If federal money is spent fraudulently under the county's watch, the county and its taxpayers are the ones on the hook.

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With that as the backdrop this week, committee members brainstormed a slew of ideas to get the funds out the door faster. Even if every business application it received is approved, the county still has more than $4 million in the business funds to push out, plus another $3.8 million in a contingency fund.

What emerged is a plan to expand the number and kinds of businesses that qualify and strip down anti-fraud paperwork.

Officials are working on a plan that would leave the current business program in place. However, it would make all businesses eligible -- not just those with up to $2.5 million in gross annual profit. It would also require financial statements only from January through September 2020.

A new, second business program would feature grants of up to $25,000. New and previous applicants would be eligible with the same pared-down requirements. That plan targets businesses impacted by the latest pandemic business restrictions, but bars and restaurants would receive priority.

There would be a new pool of $1 million set aside for entertainment venues, such as Paramount and Arcada theaters, and banquet facilities. Those establishments would be eligible for grants of up to $100,000.

A final pool of $250,000 would be available to historical societies and museums. Grants would max out at $10,000.

The full county board must first vote to approve any or all of the plans before they move forward. It meets next Tuesday.

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