Here’s a way to help SLO County businesses recover from COVID: Tap into Diablo Canyon fund

Good for you, Grover Beach.

Small businesses are desperate, and you’ve hit on a way to provide some relief: Dedicating $100,000 of your Diablo Canyon dollars to provide grants and microloans to local shops, restaurants and other businesses hurting from the COVID-19 lockdown.

Other local jurisdictions should consider that, too, if they haven’t already.

Some background: As part of the Diablo Canyon closure agreement, PG&E put $10 million in ratepayer money into an economic development fund, to be divvied up among San Luis Obispo and the seven cities.

The money was intended to soften the blow of losing jobs and revenue when Diablo is shuttered in 2024-25.

That’s four short years from now, and we’re not in a good place.

Instead of attracting new businesses, as we had hoped, we’re losing existing ones on account of the coronavirus pandemic. And while some businesses are reopening now, it will still be tough going since they won’t be able to operate at full capacity for who knows how long. And it’s not just business owners, employees and their families who are suffering, it’s local governments as well. They’ve lost millions of dollars in tax revenue, mostly from the steep drop in consumer spending.

Rescuing local businesses from the brink would indirectly help all of us, by providing the tax revenue needed to pay for police and fire services, parks, libraries, road maintenance, you name it.

What’s happening elsewhere

Other counties and cities already have launched grant and loan programs for small businesses in their areas. A few examples:

• Stanislaus County has awarded small business relief grants of $10,000 to 300 small business and 44 private contractors, funded through a combination of federal funds and local donations.
• The city of Modesto is offering zero-interest, forgivable emergency loans of up to $10,000, paid for with federal block grant revenue.
• The city of Berkeley committed up to $1 million of city funds for $10,000 grants to small businesses and nonprofits. It also set up the Berkeley Relief Fund to collect donations for future rounds of small business grants — another idea that would work well for San Luis Obispo County cities.
• Fresno County allocated $5 million in federal coronavirus relief funds to award grants of up to $5,000 to businesses with fewer than 10 employees that had not yet received any other grants or loans.

Federal and state governments are another source of financial aid, but we’ve already seen how that works. There’s not nearly enough money to go around, and payments are often delayed — just ask Americans who are still waiting for their federal stimulus checks.

A program like the one proposed in Grover Beach — which the City Council is scheduled to consider on June 1 — would be far more responsive.

“This would put cash in the hands of our local business community right now,” said Grover Beach City Manager Matthew Bronson.

The city is contemplating making grants and loans of up to $5,000; since 41% of Grover’s businesses have fewer than five employees, even that small infusion of cash would go a long way.

How agencies planned to use the Diablo money

Some local agencies already have ambitious plans for their share of the PG&E money — which don’t include direct aid to small businesses.

The city of San Luis Obispo, for example, was allocated $1.82 million — more than any other city.

Here is its plan for the money:

“The first is a shop local program, which will be a full blitz advertising to help small businesses and keep our community shopping local,” said city manager Derek Johnson. “The second piece is to update our Economic Development Strategy and the last piece, which is the lion’s share, is going to the Prado Road overpass.”

San Luis Obispo County received a little over $3.6 million, none of which has been spent.

Here’s the spending breakdown, according to County Administrative Officer Wade Horton:

• Economic development: $1.7 million
• Affordable and workforce housing: $1 million
• Infrastructure: $948,000

County Supervisor Bruce Gibson advocated strongly for housing at the time the money was allocated, but he acknowledges conditions have changed dramatically on account of coronavirus: “That was in a different world,” he said, adding that he would be open to reconsidering how the money should be used.

Board Chair Lynn Compton also supports helping small businesses. “I would love to do that, or something like that,” she said of the Grover Beach plan, adding that there may be other sources of funding, such as federal aid.

That’s good. If there is other money available to help small businesses, it makes perfect sense to use that, though it’s hard to imagine that any one source of revenue would be enough.

And again, the beauty of Diablo Canyon money is that it’s already here and could be put to work to solve our most pressing problem: retaining the businesses we already have.

After all, economic development plans and “shop local” campaigns aren’t going to do a lick of good if there aren’t many places left to shop.

We strongly urge local cities and San Luis Obispo County to follow the lead of Grover Beach and consider using Diablo Canyon economic development funds to provide immediate relief to local small businesses — before it’s too late to save them.