Grants and Loans Catalyze Small Business Recovery

Today Florence is bustling with visitors taking advantage of Oregon’s reopened status to explore the scenic coast. But for much of the pandemic, Homegrown Public House & Brewery in the town’s Old Town district had to close indoor dining. Like many small business owners in Oregon, the pub’s owner Elaine McMillan scrambled to adapt.

She helped to quickly organize 25 local restauranteurs to form the Florence Restaurant Alliance. Together, they share resources and reassure the public of their commitment to safety during the pandemic. McMillan also connected with state and local officials, gathering news about emergency funding opportunities to share with the group.

By April 2020, just a few weeks into new dining restrictions, she received an emergency grant from Community LendingWorks to bolster the pub’s outdoor dining capacity.

“We were able to add a patio and four tables. It was huge,” McMillan recalls. The patio seating, along with a shift to takeout orders, kept the business going.

The grant offered through Community LendingWorks was part of an emergency program that provided grants and loans to 1,200 small businesses impacted by COVID-19. The funds were a lifeline for Elaine and small business owners around the state.

Community LendingWorks, an Oregon-based community development financial institution (CDFI), provides access to capital and asset building services to individuals and small businesses working toward financial stability. Community LendingWorks is the only CDFI in the region making small business and microenterprise loans of $100,000 and less.

Early in the pandemic, the lender acted quickly to help businesses reeling in the wake of restrictions and lost revenue. Community LendingWorks was the first CDFI loan fund to launch an emergency loan program in March 2020, followed soon after by the grant program funded in part by OCF.

“This was at a time when the federal government and the state were still trying to figure out how to respond. We were the early adopter for small business revitalization,” says Lynn Meyer, director of community lending for Community LendingWorks.

“The first round of funding that we provided, whether as an emergency loan or emergency grant, was some of the most impactful capital that business owners had. It allowed them to makey some key decisions, fix their supply chain, pivot, or just have a little bit of operating capital, not knowing what was coming,” says Meyer.

Many businesses paired emergency grants, which covered immediate needs, with loans supporting long-term strategic investments, such as adopting new business models, upgrading technology and building e-commerce capabilities.

“As an example, in the food and beverage industry, takeout and delivery was an afterthought pre-pandemic. Now it’s a major part of their product line and it allows them to be nimble.”

OCF, backed by donors, supported Community LendingWorks’ emergency grant program with a $310,000 grant from the Oregon Small Business Stabilization Fund. In addition, Community LendingWorks is an OCF borrower from the Oregon Impact Fund, OCF’s loan program. OCF offered all borrowers an interest waiver for six months to focus on their response to the pandemic. This enabled Community LendingWorks to extend flexible terms to their borrowers while retaining staff necessary to make and manage loans.

“OCF couldn’t have been a better partner,” Meyer recalls. “The response was immediate. It allowed us to reach out to not only our own portfolio to see how we could help with loan deferments, but it allowed us to reach out to rural communities as well.”

Lately, Community LendingWorks has seen an uptick in business loan inquiries. “The entrepreneurial spirit is still strong. There are a lot of people who have either lost their jobs or had time to evaluate where they are, and are interested in seeking a new opportunity,” Meyer says. “But there is still a lot of trepidation.”

“We’re going to have to rebuild and stabilize communities from a capital perspective, for the next 18 months to three years,” he says. “This is not going to be a quick turnaround.”