Schenectady MWBEs await lifeline from city

Ron Spencer-Reap, owner of Soul Food Hall, stands in front of the former Brandywine Diner on Emmett Street in Schenectady on Thursday, Sept. 17, 2020.
PHOTOGRAPHER:
Ron Spencer-Reap, owner of Soul Food Hall, stands in front of the former Brandywine Diner on Emmett Street in Schenectady on Thursday, Sept. 17, 2020.

Categories: -The Daily Gazette, Business, News, Schenectady County

His business, G-Walk Cleaning Service, had taken off to the point where he was landing more and more clients. Prospects for several big projects were on the horizon, and to prepare for the increase, Walker was in the midst of reconfiguring his office — even blocking out space for a conference nook.

Now it’s all wiped out.

“I had my opportunity to work my way out of poverty and this was a setback,” said Walker, who started as a dishwasher at Apertivo. “It took 10 years to get where I am and it took one day to turn it all around.”

He pointed at a stack of freshly-laminated posters on the floor, none of them likely to see the light of day.

Amid lost revenue during the coronavirus pandemic and changes implemented by his landlord, Walker sat amid the clutter of his office, torn asunder as he prepares to relocate.

The Payroll Protection Program (PPP) helped with rent.

Others weren’t so lucky, and received nothing at all.

“We didn’t get a quarter,” said Ron Spencer-Reap, who oversees his family’s three small businesses, including the Soul Food Caribbean Hall located in the former Brandywine Diner.

It takes years to build good credit, said Spencer-Reap, standing alone behind the counter on a recent weekday morning accompanied by the bang and coruscating lights of an Alien Armageddon arcade game.

“We don’t get treated the same as a ‘Capital A’ business.”

While once bustling in the mornings, the restaurant was forced to nix in-house breakfasts — meals assembled by “putting everything together and grinding it all up while dancing to it” — and slash staff.

Yet a ray of light emerged last week.

Soul Food Caribbean Hall and other small businesses in the city, many of them Minority and Women-Owned Business Enterprises, or MWBEs, can now apply for their share of newly-allocated federally emergency relief funds.

Small businesses will now be eligible to apply for micro-grants between $2,500 and $10,000 designed to help them navigate the economic fallout caused by the pandemic.

Spencer-Reap will seek relief, and hopes the funds can be used to hire staff, pay bills and help with reconfiguring the restaurant to ensure customer safety.

Business at his family’s two transportation companies has also taken a nosedive.

“We’re just a family-owned business just trying to get over the hump,” Spencer-Reap said.

Earlier this month, the Schenectady City Council approved entering into a contract with the Community Loan Fund of the Capital Region to administer $250,000 in funding, just a portion of $150 billion allocated to states nationwide to cover pandemic-related costs as part of the CARES Act, the first federal stimulus package.

COVID-19 has disproportionately impacted MWBEs.

Research from the University of California at Santa Cruz revealed there were more than 1 million Black-owned businesses in the U.S. in early February.

But by mid-April, 440,000 Black business owners had closed their companies, a 41 percent decrease compared to just 17 percent of white-owned businesses shuttered during the same period.

Several factors explain the high rate, including lack of access to bank credit, said Linda MacFarlane, executive director of the Community Loan Fund.

MWBEs tend to be start-ups, MacFarlane said, and haven’t yet forged long-standing relationships with banks or lending institutions to receive loans or access to capital.

“Historically MWBEs have been undercapitalized and you can’t explain that,” said MacFarlane, noting PPP didn’t reach many local MWBEs, whether through lack of wherewithal to apply or other contributing factors.

“Disproportionately, MWBEs received considerably less or nothing at all from those requests,” MacFarlane said.

As the pandemic drags on, the city sees the program as a matter of survival.

“For a small business, $2,500 could be a lifeline,” said city Affirmative Action Officer Ron Gardner. “It really makes a difference.”

Businesses can begin to apply in October. Those awarded funding will also receive training, including technical assistance and guidance in navigating the state’s social distancing requirements and mandates, which can be confusing for some.

Roy Vincent, owner of Roy’s Caribbean Restaurant, opted not to open the bar within his restaurant despite state restrictions being lifted in June, citing confusing and shifting mandates, including those related to serving food with alcohol.

Vincent recounted the all-too-familiar immediate plunge in business in mid-March, including a catering business that remains dried up as major downtown employers remain closed and the event industry inactive.

While apps like Grubhub and DoorDash have provided some degree of relief, using them has their perils.

Fees are high, and some users, Vincent said, have hatched scams that allow them to cancel their orders after receiving the food, a loophole that puts Vincent on the hook.

If awarded funding, Vincent aims to rehire staff and make long-needed repairs to his business on State Street, including a new roof.

“With winter coming again, it’s going to start leaking,” Vincent said.

The Community Loan Fund will also help restaurants respond to pandemic-induced changes in the supply chain, including working with new vendors and helping them calculate how much food to order, a new challenge as concerns over food waste have taken on heightened sense of urgency with shrunken profit margins, an unpredictable customer base and sense of unease as cold weather sets in and experts warn of a spike in cases.

Businesses will also receive guidance in how to tap into additional state and federal funding streams as they become available.

Many didn’t apply for PPP because they didn’t have the resources to do so, including Molain Gilmore, owner of an asbestos remediation company.

The paperwork was just too intense, Gilmore said.

While her business, Greater Environmental Resources, has $80,000 in projects lined up, it’s on pause by clients who continue to harbor safety concerns.

“Our contract work is at zero,” Gilmore said. “We’re down at the bottom trying to get to the top.”

Walker, owner of the janitorial services company, hopes aid will be a new beginning and a life preserver until he begins several big projects, including clean-up at Yates Village, where the Schenectady Municipal Housing Authority is in the midst of major renovations.

“It would help me keep business open and help me get this thing off the ground,” Walker said.

Gardner sees the relief funds as just one component of his ongoing commitment to strengthen the city’s Black-owned businesses.

The funding stream joins legislation recently adopted by the City Council that raised the cap on the amount to which MWBEs can bid on city projects, a measure Gardner hopes will widen the playing field.

He hopes forging closer relationships with businesses will allow them to better tap into other opportunities that can benefit them.

“In the grand scheme of things,” Gardner said, “I see this as an opportunity to open the door to better engage with them.”

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