State of Illinois making grants available for non-essential businesses

Applications must be made through participating local governments

MENDOTA – The State of Illinois has developed the Downstate Small Business Stabilization Program for Non-Essential Businesses in wake of the shutdown of non-essential businesses due to the COVID-19 crisis.

To demonstrate, businesses must have been operating continuously with the same ownership since January 1, 2017 (at a minimum) and provide documentation on the financial health of the business in 2017, 2018, 2019 and currently. This documentation will be available to the public as part of the application process and is subject to FOIA. Benefiting businesses should have solid commitments to remain open or reopen, and retain or re-employ permanent jobs.

All applications must be made through a unit of local government recognized by the Illinois Constitution and able to support economic development activities on a sufficient scale; this includes cities, villages, and counties. Grant funds are granted to communities to be provided as financial assistance to an eligible business, which must document the need for grant assistance. Businesses cannot apply directly to DCEO for assistance and grant awards will not be made directly to the business.

The Economic Development Downstate Small Business Stabilization component has been established to provide working capital funds to communities’ businesses economically impacted by the COVID-19 virus.  The program component makes funds available for 60 days of verifiable working capital up to a grant ceiling of $25,000.

CDBG Economic Development Downstate Small Business Stabilization funds may be used to assist private for-profit small businesses considered non-essential by the Governor’s Executive Order without the ability for employees to work remotely. Businesses must have at least one full-time equivalent (FTE) employee other than the owner(s) but must not exceed 50 employees (total number of people employed) including the business owner(s).

The following businesses are specifically ineligible for assistance:

  • Businesses that have both essential and non-essential activities.
  • Not-for-profit businesses.
  • Independent contractors.
  • Franchises or chain businesses.
  • As this grant is federally funded, businesses that involve the use of cannabis for medical and/or recreational purposes are not eligible to apply.
  • Private club or business that limits membership for reasons other than capacity.
  • A business that derives at least 33% of its gross annual revenue from legal gambling activities, unless, subject to the Department’s approval, the business is a restaurant with gaming terminals.
  • Business engaged in manufacturing or selling at wholesale, tobacco products, vaping, liquor or sexually explicit materials or in the business of manufacturing or selling firearms at wholesale or retail.
  • Liquor store, an adult bookstore, non-therapeutic massage parlor, strip club or nightclub.
  • Pawn shops.
  • Storage facility, trailer-storage yard or junk yard.
  • A business in which a majority owner or member of the immediate family is an elected official of the unit of local government making the application and receiving the grant.
  • An establishment similar to any enumerated above; or
  • Any other business subsequently deemed ineligible by the U.S. Department of Housing and Urban Development.

For additional information on essential and non-essential businesses, see:  Some exceptions to the essential business requirement may be made if other social-distancing directives make it impossible for the business to continue and that situation is satisfactorily demonstrated in the application. Exceptions will be made on a case-by-case basis; all decisions are final.

Funds are available to all eligible applicants meeting program component requirements until all funds allocated to this component have been distributed. All awards in this category are predicated upon a demonstrated need for funds. This will include a review of all sources and uses of funds, an analysis of the recipient’s ability to comply with the terms of the program, and a determination that CDBG participation is appropriate.

Businesses must enter into a financial assistance agreement, referred to as the “Participation Agreement,” at agreed upon terms with the local government making the application and receiving the grant award. The Department has provided a boilerplate of the agreement in the application forms. The agreement language can be altered but if so, must be pre-approved prior to the application.

The City of Mendota will have packets available at 9 a.m. Friday, April 10 for those businesses that wish to apply. They must complete their parts of the applications and return them as soon as possible. Since all applications must have a Public Hearing, and those hearings must be publicized at least seven days prior to the date of the hearing, it is imperative to get the applications filled out and returned as soon as possible.

Applicants can email Mendota city clerk Emily McConville for packets. She will email, mail or otherwise provide a packet for those interested. [email protected] or


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