Amid the COVID-19 pandemic, Northwest credit unions helped thousands of small businesses obtain Small Business Administration Paycheck Protection Program and Economic Injury Disaster loans….Read more »
Oregon Credit Unions Unite to Help Small Businesses
Amid the COVID-19 pandemic, Northwest credit unions helped thousands of small businesses obtain Small Business Administration Paycheck Protection Program and Economic Injury Disaster loans. Credit Union Movement leaders have been frustrated, however, that so many truly small businesses — those with fewer than 25 employees and sole proprietorships — were left behind. Minorities, women, and rural small business owners are the hardest hit.
The Oregon Legislature, in partnership with Governor Kate Brown, set aside $5 million from the state general fund and redirected another $5 million from existing programs at Business Oregon, to help those very businesses. Community Development Financial Institutions (CDFIs) are eligible to deploy $5 million of the funds as grants the businesses will not have to pay back. Grant amounts range from $2,500 to $12,500 depending on the number of people the businesses employ.
In May 2020, the Northwest Credit Union Association convened Oregon’s CDFI credit unions to discuss the opportunity. A coalition of four credit unions moved forward, and garnered a large, $1.7 million grant.
The four credit unions are Consolidated Community, Point West, Trailhead, and Central Willamette. They stand ready to help not only their members, but members of credit unions throughout the state.
“Collectively, our goal was to provide support to small businesses throughout Oregon that have been deeply affected by the COVID-19 pandemic,” said Larry Ellifritz, President and CEO of Consolidated Community. “I could not be prouder to work with Point West, Trailhead, and Central Willamette to get these grants to small businesses. This is a great collaborative effort.”
Ellifritz championed the grant application. He thanked NWCUA for its support and for recommended guidance it provided in a letter to Business Oregon, and the Northwest Credit Union Foundation for guidance on the application.
The collaboration is in alignment with credit unions’ “People Helping People” mission.
The grants are designated for historically disadvantaged businesses in every corner of the state, according to guidelines provided by Business Oregon. Eligible businesses must have 25 or less employees or must have seen a 50% reduction in revenue during March or April, vs. revenue earned in January or February. In addition, eligible businesses may not have already received CARES Act federal funding. The state wants grants prioritized for business owners who are Asian, Black, Hispanic, Native American, or women.
“What makes this program so special is that the door is open for all Oregon credit unions to work together to help small businesses,” said John Trull, NWCUA Vice President, Regulatory Advocacy.
Under the guidelines, participating credit unions can issue 25% of their grant funds to their current members, but 75% must be granted to business owners who are not members of a participating CDFI credit union. This means non-participating credit unions can refer their members who need a grant, to one of the four credit unions collaborating in the program.
“As not-for-profit cooperative financial services providers, credit unions are well positioned to help the truly small businesses in rural communities, and minority owned businesses, to receive these grants,” said Troy Stang, NWCUA President and CEO. “We appreciate the Oregon Legislature for setting aside $5 million in funding, and Business Oregon for allocating $1.7 million to the four Community Development Financial Institution credit unions that will distribute the funds. Those credit unions, in working with the broader Oregon credit union community, stand ready to help underserved Oregon businesses in all impacted communities.”
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