Section 601(a) of the Social Security Act, as added by section 5001 of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), established the Coronavirus Relief Fund (Fund) and appropriated $150 billion to the Fund. Under the CARES Act, the Fund is to be used to make payments for specified uses to States and certain local governments; the District of Columbia and U.S. Territories; and Tribal governments. Hennepin County received a direct payment out of the Fund from the U.S. Treasury.

The CARES Act provides that money from the Fund may only be used to cover costs that:

1. are necessary expenditures incurred due to the public health emergency with respect to the Coronavirus Disease 2019 (COVID–19);
2. were not accounted for in the budget most recently approved as of March 27, 2020 (the date of enactment of the CARES Act) for the State or government; and
3. were incurred during the period that begins on March 1, 2020 and ends on December 30, 2020.

Allowable expenditures include those incurred to respond to second-order effects of the emergency, such as providing economic support to those suffering from employment or business interruptions due to COVID-19 related business closures. Federal guidance for the Coronavirus Relief Fund specifically includes as allowable “expenditures related to the provision of grants to small businesses to reimburse the costs of business interruption caused by required closures.” Allowable expenditures also include expenses of actions to facilitate compliance with COVID-19-related public health measures, as well as a grant program to benefit small businesses that close voluntarily to promote social distancing measures or that are affected by decreased customer demand as a result of the COVID-19 public health emergency.

Minnesota Governor Tim Walz’s Emergency Executive Order 20-96 (signed November 10, 2020) found that “data points to social gatherings (including friends and family gatherings at private homes), celebrations, and bars and restaurants as the most significant source of COVID-19 spread in the state.”  Executive Order 20-96 further states that venues, bars and restaurants must close and remain closed each day for on-premises consumption between the hours of 10:00 p.m. and 4:00 a.m. effective Friday, November 13, 2020 at 10:00 p.m. Executive Order 20-96 also sets strict capacity limits for venues, bars, and restaurants. 

Hennepin County recognizes that this Order will have a compounding impact on businesses and employees that have already borne a great deal of hardship due to this pandemic.  Many venues, bars, and restaurants have already voluntarily closed (temporarily or permanently) due to a variety of challenges including current pandemic conditions.

Allocation and implementation of $8,000,000, or more if additional funds previously allocated to small business relief are available as current applications are processed, in CARES Act funding is targeted to allow the county to support those businesses most significantly impacted, specifically, those businesses with the following North American Industry Classification System (NAICS) codes impacted by Executive Order 20-74 and Executive Order 20-96:

·         Restaurants (72-2500)

o   Full-Service Restaurants (72-2511)

o   Limited-Service Restaurants (72-2513)

o   Cafeterias, Grill Buffets, and Buffets (72-2514)

o   Snack and Nonalcoholic Beverage Bars (72-2515)

·         Drinking places (72-2400)

Eligible applicants will additionally:

·         be locally owned and operated;

·         have a physical establishment in Hennepin County;

·         have 100 or fewer employees; and

·         have $6 million in annual revenues or less.

Administrators will rely on applicant certification of the above and all grant recipients will be required to provide documentation in support of their eligibility upon request.  The maximum grant amount will be $15,000 per business, however restaurants and bars that have previously received small business relief funding from Hennepin County will be eligible for $10,000 per business through this funding opportunity.

In addition to direct financial assistance, Amendments to existing Agreements with the Greater Minneapolis Chamber Development Foundation and Workbay, LLC will make additional outreach, technical assistance, and industry expertise available to Hennepin County businesses in the restaurant, bar, and food service industry.  

Current Request: This request is to allocate $8,000,000 of federal CARES Act Fund resources to small business relief; authorization to negotiate vendor agreement(s) in the total not to exceed amount to $8,000,000 (including up to $320,000 for vendor administration) for financial review and technical assistance in processing Hennepin County Small Business Relief program applications, during the period November 18, 2020 through December 30, 2020.

Impact/Outcomes: Approval of these agreements is anticipated to reduce social gatherings that have resulted in increased community transmission by supporting local  bars/restaurants impacted by the COVID-19 pandemic, as they implement the new restrictions in Executive Order 20-96.