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Northam Wants To Set Aside Pandemic Relief Money For Small Businesses

Photo by Gina Gambony, WHRO. Hampton Roads business owners say they’re still recovering from the COVID-19 pandemic.

Jaqui Lilly describes the past 15 months of business at her Virginia Beach art shop as a series of scary plunges and modest rebounds.

Sales at Beach Gallery near the Oceanfront completely stopped amid the initial pandemic shutdown in 2020. They returned in the summer and over the holidays before tanking again earlier this year.

Although business is slowly recovering, Lilly still struggles to pay advertising fees and other routine expenses.

“Scraping by,” she said. “Rent is huge here. It’s over $3,000.”

Martino DeStafano, general manager of the Hilton hotel along the oceanfront, is in a similar predicament. He needs about $375,000 to fix maintenance issues.

With few guests during the pandemic, hotel rooms sat vacant for long stretches of time.

“If you don’t use your ACs for a while, you don’t run water through the pipes,” he said, “certain things end up failing.”

As the COVID-19 pandemic subsides across Virginia, businesses around Hampton Roads are still rebounding from the economic fallout. Gov. Ralph Northam hopes a new budget proposal will speed up their recovery.

Virginia will soon receive $4 billion in federal funds as part of the American Rescue Plan passed by Congress earlier this year. Northam wants to set aside $350 million for small businesses and industries.

“The pandemic affected everyone,” Northam said during a recent news conference in Virginia Beach. “Many large companies were able to pivot. But small businesses felt the brunt of the pandemic’s impact.”

The governor has said he also wants to use federal pandemic relief funds for other priorities, including modernizing school buildings, expanding broadband access and upgrading public health services, among other priorities.

State lawmakers will review Northam’s plan for the federal money when the General Assembly convenes for a special session in August.

The latest proposal directs $250 million toward the Rebuild VA economic recovery fund, which provides grants of up to $100,000 for small businesses and nonprofits hurt by the pandemic.

In a press release, the governor’s office said the fund has already assisted thousands of businesses, and the new infusion of money will help it meet “ongoing demand.”

Northam’s proposal also directs $53 million to the state’s Industrial Revitalization Program Fund and Virginia Main Street program, which aim to jumpstart industrial projects and revitalize small towns. State officials will focus on using the money for minority and immigrant communities and woman-owned businesses, the release said.

“With the American Rescue Plan, we have a once-in-a-generation opportunity to rebuild from the impacts of the pandemic, revitalize our communities and invest in our shared prosperity,” Northam said.

The final $50 million in the governor’s proposal will be for the Virginia Tourism Corporation after the Commonwealth lost about $14.5 billion in tourism spending amid the pandemic. The new money will help fund destination marketing organizations around the state and pay for Virginia tourism ads in cities across the country.

Business owners around Hampton Roads were elated to hear about Northam’s plan.

Lilly, the owner of the Virginia Beach gallery, immediately knew how she would use the money.

“Paying my rent...my employees of course,” she said. “We’ll see how the process goes. I’m sure it’ll be an apply-and-review situation.”

There are other efforts to bolster small businesses and workers.

Northam has said that employers are struggling to staff jobs because some potential employees remain concerned about the pandemic and lack of childcare.

As businesses offer financial incentives to lure employees back, the state recently launched a new pilot program to match those bonuses up to $500.