2020 was a difficult year to be many things, government officials among them. The pandemic presented unique challenges for leaders at the local, state and national levels, and Arkansas was no exception.
Before COVID-19 set in, the Arkansas economy was continuing to expand. Coming out of February 2020, the state unemployment rate was at 3.5 percent, and the labor force entailed more Arkansans working than ever before — 1.37 million. More than 107,000 Arkansans were working in February than were doing so in January of 2015, according to the Arkansas Economic Development Commission.
Fast forward to November, and the state’s jobless rate had risen to 6.2 percent. But the rate had fallen from 7.3 percent in September and from the state’s 2020 high of 10.8 percent in April. Meanwhile, the U.S. unemployment rate was 6.7 percent for December, down from 7.9 percent in September. The big picture closed looking better in 2020, but the pandemic’s impact lingers on.
To combat that impact, the state and even some private organizations funded programs to help keep small businesses open. Small businesses represent 99.3 percent of all businesses in the state and employ just under half a million, according to AEDC.
The state’s initial COVID response included $10 million in Community Development Block Grants (CDBG) to 27 rural hospitals employing 7,899 Arkansans. The grants, which ranged from $250,000 to $500,000, were awarded to provide economic assistance and public health services in the form of operational costs, equipment and supplies.
The state’s $9 million Quick Action Bridge Loan Program was designed to help small businesses across all industries with two to 50 employees bridge the gap until federal Paycheck Protection Program (PPP) loans could become available. Last year, it benefited 483 small businesses representing 6,610 Arkansas jobs.
The AEDC Ready for Business Grant Program leveraged $1.25 billion in CARES Act funds to assist Arkansas business owners with expenses related to reopening or resuming operations.
Arkansas Commerce Secretary Mike Preston said the program was intended to help small businesses struggling with social distancing and PPE requirements that strain already thin margins.
“Business owners lacked the working capital to restock and advertise,” he said. “We wanted to help create a sense of confidence for employees and customers that it was OK to return to business.”
Grant amounts were based on the number of employees an organization had as of March 1, 2020, and grant recipients could receive $1,000 per employee up to a maximum award of $100,000.
Eligible expenditures under the program include:
• PPE and no-contact thermometers for employees and customers
• No-contact Point of Sale (POS) payment equipment
• Supplies and disinfectants to be used for deep cleanings
• Hiring a third party to perform periodic deep cleaning services
• Hand sanitizer stations
• Restocking of necessary supplies/raw materials
• Expenses associated with recommended health and safety guidelines
• Signage, marketing and other one-time expenses associated with reopening or resuming normal operations.
More than 11,000 businesses in all 75 counties received grants totaling $128.8 million benefiting 225,000 jobs. Roughly 94 percent of grant recipients had less than 50 employees, 33 percent were women-owned and 25 percent minority-owned.
Loans to developmental disability providers
• $7.8 million forgivable loan program
• Available to large providers of services to the developmentally disabled such as Goodwill and Easter Seals not eligible for assistance through other federal programs
• Loans forgiven using same criteria as PPP
• Benefited 3,921 Arkansas jobs.
Public services, public facilities and microenterprise assistance to local governments
• Provides $14.6 million in CDBG-CV assistance to non-entitlement local governments
• Examples of permitted uses for these funds include public services and public facilities, and direct assistance to microbusinesses
• Funds must be used for unmet needs, which directly prevent, prepare for, and respond to the coronavirus pandemic
• Competitive Applications due March 31st, 2021.
Rental assistance unemployment benefits
• $10 million allocated — $5.76M from CDBG-CV and $4.24M from CARES Act
• Available to households whose income is no more than 80 percent of area median income
• Benefit amount of up to 2.5 months rent (up to HUD fair market rents)
• Funds distributed through 15 community action agencies
• Consents secured from landlord to waive late fees and not pursue eviction.
To help ensure the Arkansas workforce made it to 2021, the state paid or administered
billions in unemployment benefits. Through Nov. 20, those totals were:
• Regular benefits (Regular Unemployment Insurance) — $398.1 million
• TRA benefits (Trade Readjustment Allowance) — $513,000
• FPUC benefits (Federal Pandemic Unemployment Compensation) — $1.65 billion
• PUA benefits (Pandemic Unemployment Assistance) — $313.6 million
• PEUC benefits (Pandemic Emergency Unemployment Compensation) — $84.6 million
• EB benefits (Extended Benefits) — $7.8 million
• LWA benefits (Lost Wages Assistance) — $137 million.
Initial claims for regular unemployment insurance peaked the week of April 4 at
62,086, but by Dec. 12 had fallen to 3,395.
• $4.7 million in CDBG-CV to be awarded in early 2021
• Awards coordinated through Arkansas Hunger Relief Alliance
Arkansas rural connect broadband program
In 2020, the Arkansas Rural Connect (ARC) broadband program distributed millions to rural Arkansas to help establish high-speed broadband services. The program is administered through the Arkansas Department of Commerce Broadband Office. Preston said the funds deployed across the state were especially significant in 2020 as rural small businesses struggled to stay open.
Through Dec. 28, the program had awarded $86.8 million to 60 rural broadband-service providers in Arkansas — $82.3 million from the federal CARES Act and $4.5 million in state funds.