When Congress passed the CARES Act last spring, it allocated more than a billion dollars to South Dakota for coronavirus relief efforts. Iowa and Wyoming received the same allocation, with the money to be spent at the state’s discretion.
All three states have some form of program providing grants to small businesses impacted by the pandemic, but how and when those funds are distributed varies greatly.
South Dakota set aside $400 million for small businesses. Wyoming gave out $325 million to businesses and Iowa distributed nearly $300 million to businesses and individuals financially impacted by the pandemic.
“The first program the Iowa Economic Development Authority launched in early spring was the Small Business Relief Grant Program,” Iowa Finance Authority Communications Director Ashley Jared said.
Jared said Iowa received upwards of 14,000 applications for the first of its 15 programs; the spring program distributed nearly $91 million to more than 5,100 businesses.
“From inception of the program to getting checks out the door it took us 18 days to set that up,” Jared said.
Iowa was one of the first states in the country to distribute Federal CARES Act dollars to businesses, Jared said, with the first grants of up to $25,000 going out to businesses even before the federal Paycheck Protection Program began.
“We knew this wasn’t going to sustain them forever, but it really was needed for a lot of business owners we heard from that said we saved them from mortgaging their house or closing their doors permanently,” Jared said. “It was a highly successful program, we’re really proud of it. We were able to get funds out the door really, really quickly to those businesses in need.”
“The Wyoming process was very streamlined, they knew the amount they were going to get right when they applied and the funds were dispersed timely,” Wilson, Hanson & Blom Tax Manager Theresa Koscak said.
Wyoming distributed $325 million to more than 8,500 applicants through five different programs, the first going out in June and July. But the largest business relief program ran in August and September, with grants up to $300,000.
“All in all, it was a great program and our Wyoming clients benefited from it immensely,” Koscak said.
Koscak also helped her South Dakota clients apply for this state’s small business grants that were worth up to $500,000. The first round of applications for the program were submitted in October.
Now more than two months later, South Dakota has distributed $97.6 million to 1,350 small businesses, but nearly 2,000 applicants are still waiting to learn if they’ll receive any funds.
Who’s running the program also differs by state. Wyoming ran all of its grant programs through existing state offices. Iowa also ran its programs in house but did bring in a consultant to help review applications for their highest volume programs. South Dakota has a $6 million contract with a Virginia-based consulting firm to run its small business grant program.