COVID relief: Speeding Community Development Block Grant (CDBG) loans
Topeka, Kan. – In an effort to speed relief funds in the face of the current public health emergency, the Department of Commerce is providing guidance on how CDBG funds, which are already in Kansas communities, can be loaned to area businesses more quickly.
Under certain circumstances these funds can be made available via local governments in just 24 hours.
“Local communities have a better understanding of the immediate needs in each of their communities,” Kansas Department of Commerce Secretary David Toland said. “The state stands ready to support them in making these funds available to communities across Kansas.”
There is currently about $6 million in CDBG funds that resides in communities statewide as local Revolving Loan Funds. The funds are administered by cities, counties and economic development organizations. Under normal circumstances when a community wants to issue a business loan, Commerce must conduct an environmental review that takes 30 days. The communities also must do public notice, which can also take 30 days.
If a revolving loan is for working capital, then environmental review is not applicable, and the public notice can be reduced to 24 hours. This allows communities to issue a loan in two days and not involve the Department of Commerce. This will speed the delivery of these funds to businesses that need it now.
Local communities are also empowered to make decisions on matching funds, collateral and interest rates, as well.
Secretary of Commerce David Toland will hold a conference call with CDBG communities Friday, March 20, 2 p.m., to promote the use of these funds to help ease the burdens of the coronavirus crisis.
For more information on Community Development Block Grants, visit: https://www.kansascommerce.gov/programs-services/community-development/community-development-block-grant-program/.