The Yorkville City Council will meet in a special online remote session Tuesday to vote on a resolution designed to protect the city’s risks in approving state grant applications for businesses impacted by the coronavirus pandemic.
Aldermen recently approved a first round of 18 applications for the Downstate Small Business Stabilization Grant program.
The move was contingent on the city developing an agreement with Kendall County to use county revolving loan funds as a “backstop” for any businesses that default on their loans through the program.
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“City and county staff have been working together to finalize the form of the agreement,” Yorkville City Administrator Bart Olson said in a report to aldermen.
Kendall County has offered use of its revolving loan fund to municipalities that are approving applications for the state-managed grant program. The city’s loan amount is $400,000. This is the maximum amount available to Yorkville since the remainder of Kendall’s revolving loan fund is being split between all municipalities in the county, Olson said.
The amount is less than the total potential value of the first 18 grants that have been applied for as well as eight second round grants applied for in the program, he said.
“While city staff thinks it is unlikely that more than a handful of Yorkville businesses will receive state grants, a $230,000 gap between the loan and potential grant awards represents the city’s risk in the program,” Olson said.
The Downstate Small Business Stabilization Grant program offers up to $25,000 to small businesses with 50 or fewer employees classified as non-essential workers during Gov. J.B. Pritzker’s stay at home order, city officials said.
The program is administered through Housing and Urban Development Community Development Block Grant funds and subsequently requires local governments to apply for the grants on behalf of businesses.
The state has made available $20 million for the program.
Linda Girardi is a freelance reporter for The Beacon-News.