A grant program to relieve struggling small businesses and nonprofits in Maine attracted fewer potential awardees than some expected, despite a last-minute flurry of applications.

As of the deadline at midnight Wednesday, about 4,000 organizations had applied to the Maine Economic Recovery Grant program. That figure was about one-third less than expected and may have been the result of employers not knowing about the program or believing they wouldn’t qualify for aid.

Roughly 1,000 applications were submitted after noon on Wednesday, according to the Maine Department of Economic and Community Development. Only about 830 organizations had applied as of last week– worrying some economic development agencies – and the state had expected a last-minute rush to apply for grants of up to $100,000.

The Greater Portland Council of Governments, one of seven economic development districts overseeing the program, received a large number of applications in the last two days before the deadline, Finance Director Josh Kochis said.

But the total number received was still far fewer than the 6,000 grants the state expected, Kochis said.

“We had a really big surge of applications in the last few days of the application period, so we are really happy about that, but I can’t pinpoint the exact reasons why we didn’t get the turnout we were hoping for,” he said.

The $200 million program was launched by Gov. Janet Mills’ administration in late August, using federal money awarded to the state. It was intended to help some of the businesses hit hardest during the pandemic-induced economic downturn.

But eligibility restrictions may have suppressed interest. Grants were available to Maine-based companies with 50 or fewer full-time-equivalent employees that demonstrated a projected revenue loss of at least 20 percent since March because of the pandemic, among other rules.

Those restrictions disadvantaged or even excluded some of the state’s hospitality businesses that were hurt by pandemic restrictions and suppressed tourism, said Steve Hewins, president of trade group HospitalityMaine.

The grant program is another example of the state government “believing they know (what’s) best about the economy, and then overthinking and underdelivering, particularly to the hospitality industry,” Hewins said.

Maine’s grant program came out later, and may prove less helpful, than similar arrangements in nearby New England states, Hewins added. A Vermont program provided almost $104 million to about 3,500 businesses in $50,000 grants between July and August. Certain applicants were later eligible for an additional $100,000 of assistance. New Hampshire has, since June, provided more than $380 million in grants to over 10,600 organizations through its Main Street Relief fund.

Theater companies and arts nonprofits also complained that their organizations were at a disadvantage under the program’s rules and that it awards grants to those that have lost the most money, not necessarily those that made prudent business decisions but still need help.

Applicants to the Maine grant program will be informed of their award by the end of the month, and money should start arriving Oct. 1, according to the Department of Economic and Community Development. Grant awards will be based on an organization’s individual losses proportional to losses for the entire group of applicants.

The complicated formula and extensive application have left some small enterprises uncertain about how much they will receive, if anything at all.

“Frankly, I have no idea how they are going to decide this – it is extremely opaque,” said Peter Leavitt, owner of Leavitt and Sons Deli, which has locations in Falmouth and Portland. Leavitt said he and his accountant were confused by the state’s rules and had to resubmit his application with corrected numbers.

“Anyone who is applying is being hurt right now and could use the money,” he said. “I have no idea how they are going to pick the winners and losers in this.”

Leavitt shortened his hours, eliminated indoor service and cut staff to make it through the downturn. He thinks he’s doing about half the normal business at the Portland location and is about 40 percent down in Falmouth. He expects the winter months to be even tougher for the company.

“I don’t see any end to this. I would be very surprised if even by next summer things were back to any semblance of normal,” Leavitt said. “The fallout from this is going to be (for) a significant amount of time.”

Adria Moynihan Rusk, who taught painting at a Portland studio before the pandemic, applied for a grant but doubts she’ll get an award. Assistance from the federal Paycheck Protection Program and some small grants kept her afloat through the spring, but it’s all gone now. She hopes accepting that aid won’t diminish her chances for a grant.

“I didn’t really feel the impact of this until after June,” Rusk said. “I am feeling it the worst now, the loss of revenue and the loss of assistance.”

She said many of her friends who own small businesses never applied for the grants because they were sure they would not qualify.

Rusk is doing some online teaching, and her students want to get back into the studio for in-person classes. She hopes to restart soon in a downsized space and is trying to stay optimistic about the future.

“Businesses like mine are pretty scrappy to begin with; we’re used to having rough periods,” Rusk said. “I’m hopeful we’ll be able to get through this one, too.”

The state has not said what it intends do if the $200 million fund is not spent entirely, but the grants were considered an initial investment with the potential for future funding depending on additional federal support.

“Once the deadline has passed and the applications have been reviewed, the department will be able to evaluate what additional grants, if any funding is available, may be given,” said Kate Foye, spokeswoman for the Department of Economic and Community Development.


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