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Some Upbeat News for Black Businesses Still Reeling From Pandemic Losses

During a news briefing hosted by Ethnic Media Services last month, speakers discussed how small businesses in California and around the country can emerge from this crisis, catch the wave of what seems to be a gathering economic boom, or continue to tread water to stay afloat. 

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Happy black waitress with face mask and gloves holding open sign while reopening during coronavirus epidemic./Shutterstock

Next week, after more than a year, California is expected to lift the majority of its COVID-19 related restrictions and reopen its economy at almost-full capacity. 

But as the state prepares for a long-anticipated comeback, many Black business-owners say enterprises across the state that African Americans own face an uphill road to recovery. 

“It’s a state of disrepair. They need significant support,” said Tara Lynn Gray, director of the California Office of the Small Business Advocate.  

Black-owned business operators who are struggling will need all the financial support available to them, Gray told California Black Media (CBM) at a luncheon hosted by the California Black Chamber of Commerce in Sacramento.

(Black businesses) have been disproportionately affected by COVID-19,” Gray said. “Fortunately, the governor has stepped up and provided $2.5 billion dollars in relief funds to all small businesses with priority to the disadvantaged communities of color.”

In February 2020, there were 1 million Black-owned businesses in operation around the United States, according to a University of California at Santa Cruz report.

About six weeks later, after the onset of the global COVID-19 pandemic, the number of Black business owners had dropped to 440,000, a 41%, reduction. Many of them had to shut down their businesses for good. 

During the same time, only 17% of white proprietors had to shut down their businesses, UC Santa Cruz research shows. Overall, nearly 4 million minority-owned U.S. firms, whose annual sales total close to $700 billion, shuttered because of COVID-19.

But despite the grim statistics, a number of small business advocates say there is financial help available both at the state and federal levels for most business-owners. 

During a news briefing hosted by Ethnic Media Services last month, speakers discussed how small businesses in California and around the country can emerge from this crisis, catch the wave of what seems to be a gathering economic boom, or continue to tread water to stay afloat. 

The main objective of the briefing was helping small businesses, particularly minority owned ones, connect to various sources of funding created to help them recover from the pandemic. 

The key is to apply for the money, said Everett Sands, CEO of Lendistry, a leading, Black-led Community Development Financial Institution (CDFI) and Community Development Entity (CDE) that is also a small business and commercial real estate lender. 

“Let’s make an assumption. If you are allowed to open, and you can open, then therefore you should be able to receive some type of revenue,” Sands said. “What we’ve learned about the pandemic is that most opportunities are coming a second time. If you look at the Paycheck Protection Program (PPP), it came a third time. But it is important for businesses to apply.”

The Paycheck Protection Program (PPP) is a federal revenue replacement program designed to sustain small business jobs during the ongoing public health and economic crisis. May 31 was the last day for small business owners operating in low-income neighborhoods to apply for the third round of PPP loans.

In California, Lendistry helped thousands of small businesses secure loans and grants during the pandemic. Funded by the State of California through the California Office of the Small Business Advocate, Lendistry, was the state-contracted administrator of the program that administered six rounds of grant funding for non-profits and underserved businesses.

Sands was one of the guest speakers along with U.S. Congressman Ro Khanna (D-CA-17), a member of the Congressional Small Business Caucus, and Virginia Ali. Ali owns the nationally renowned restaurant and Black-owned small business Ben’s Chili Bowl in Wash., D.C.

Sands said before the virus surfaced, minority businesses were already in a “financially precarious position” with strained resources. Small businesses had limited access to capital, he said, and they lacked the infrastructure to apply for loans or contracts and many of them couldn’t self-finance in the long term.

But on the cusp of the state and U.S. economies reopening, Sands says it is not too late for businesses to get their financial footing. 

“As a result of the American Rescue Plan, most states received roughly $1 billion to help these small businesses increase their revenues” he said.

Of California’s 4.1 million small businesses, 1.2 million (29%) are minority-owned.  ZIPPIA, an online career support company, calculated that 10,287 Black-owned businesses operate in California. According to the June 2020 report by ZIPPIA, titled the “Most Supportive States for Black Businesses,” California ranked No. 4 before the pandemic. Based on data compiled by the United States Census’ Annual Business Survey, California’s Black businesses employ roughly 81,530 people. 

Gray said restaurants, barbershops, nail salons, hair salons, hospitality, and personal grooming services have been “inexplicably hurt” due to social-distancing restrictions in the state.

Those businesses, owned by many African Americans, were not deemed as essential when a shelter-in-place order was mandated. Now those are the businesses that Newsom intends to help, Gray stated.

“Our governor had a tough choice to make,” Gray said. “You close things down to make sure people are safe. Public health is a serious issue. I applaud him for doing that. Yes, there are consequences to our small businesses. But in the end, look at us now. We have the lowest positivity rate in the nation. Also, it looks like our economy is coming back.”

A survey conducted by H&R Block found that out of 3,000 small businesses, 53% of Black business operators saw their revenues cut in half due to the pandemic as compared to 37% of White owners. 

Black-owned small businesses continue to experience disproportionate difficulties, with 35% of Black entrepreneurs reporting that business conditions are worsening. Many say they may not survive the next three months.

While the reopening of the economy signals progress, Sands is encouraging Black businesses to pay attention to Small Business Administration programs (SBA) that include loans, a restaurant relief fund and venture capital investments.

To apply for federal small business funding, Sands says, a company only has to show the sole business’ gross revenue. Applicants won’t be excluded if the proprietor has been a borrower on a defaulted student loan or has a criminal history.

“For amounts less than $150,000, most of the red tape or the bureaucratic process of a loan has been cleared away,” Sands said. 

Khanna said more funding is expected to be distributed through the Saving Our Street Act, which would allocate loans of up to $250,000 to businesses with fewer than 10 employees.

Distribution of the money will be based on the racial and gender diversity of the business owners, he said, and it should help the economy get stronger and financially stabilize the country.

“In this next quarter, we’re going to have a pretty good recovery,” he said. “Consumer spending is at 10% growth. I think small businesses are going to come back strong. The problem is a lot of businesses that have had to close may not be able to reopen. And that’s where we have to focus: assisting with debt forgiveness and capital for those businesses that would not survive.”

 

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Business

Emergency Federal Drought Relief Available

Farmers and ranchers interested in a disaster loan can apply on the USDA website. Small, non-farm businesses, small agricultural cooperatives, and most private nonprofits can apply for the loans by contacting the SBA at 1 (800) 659-2955 or by email. Hearing impaired individuals may call 1 (800) 877-8339.

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The Marin County Board of Supervisors voted unanimously May 18, 2021, to declare a local emergency and acknowledge the imminent threat of disaster and the severe effect on dairies and ranchers in West Marin.
The Marin County Board of Supervisors voted unanimously May 18, 2021, to declare a local emergency and acknowledge the imminent threat of disaster and the severe effect on dairies and ranchers in West Marin.

Marin and all other California counties to be eligible for assistance

Courtesy of Marin County

As California and the West Coast enter their third year of drought, Marin County and the state’s other 57 counties have been declared primary disaster areas by the U.S. Department of Agriculture. The dry conditions are bad news for Marin’s farmers and ranchers, but the disaster designation status makes available emergency loans for agricultural businesses.

Additionally, the Small Business Administration (SBA) is offering Economic Injury Disaster Loans to non-farm small businesses that do business directly with farmers and ranchers, such as truckers and suppliers of agricultural equipment or services. Eligible businesses may apply for disaster loans through Dec. 8, 2022.

Farmers and ranchers interested in a disaster loan can apply on the USDA website. Small, non-farm businesses, small agricultural cooperatives, and most private nonprofits can apply for the loans by contacting the SBA at 1 (800) 659-2955 or by email. Hearing impaired individuals may call 1 (800) 877-8339.

“We want to raise awareness of the financial opportunities this drought designation provides because it may help some of these small businesses hampered by our continuing severe drought conditions,” said Marin County Agricultural Commissioner Stefan Parnay.

The federal commitment to assist businesses because of drought-related hardship extends to 23 other western states in addition to California. Small non-farm businesses, small agricultural cooperatives, and most private nonprofits of any size may qualify for SBA Economic Injury Disaster Loans to help meet financial obligations and operating expenses that could have been met had the drought not occurred.

In July 2021, the State of California added Marin to its list of counties falling under its state of emergency for drought and record-breaking high temperatures statewide. Governor Gavin Newsom made the drought official in 50 of the state’s 58 counties. Since then, state agencies partnered with local water suppliers to promote conservation tips through the Save Our Water campaign.

The Marin County Board of Supervisors voted unanimously May 18, 2021, to declare a local emergency and acknowledge the imminent threat of disaster and the severe effect on dairies and ranchers in West Marin. It also made the County eligible for California Disaster Assistance and other forms of state funding and resources. The local declaration cleared the way for state authorities to aid response and recovery efforts available to the County, water suppliers, farmers, impacted businesses and residents.

Marin Water, the municipal water district serving the majority of water customers in the county, and the Novato-based North Marin Water District (NMWD) are staying in contact with the County about drought conditions. Both water districts have declared water shortage emergencies and enacted mandatory conservation measures. Marin Water serves more than 191,000 customers in central and southern Marin. NWMD serves a customer base of about 64,000 in and around Novato and parts of coastal West Marin. For localized details, see the water rules webpages for Marin Water and NMWD.

Marin residents have been asked to support local agricultural producers who have been affected by the drought right on the heels of the COVID-19 pandemic. In 2021 numerous Marin ranchers had to import water by truck to keep their animals alive while also reducing their herds. With far less vegetation for grazing because of the ongoing drought, animals are eating imported feed shipped from other states at extremely high costs to the ranchers. Additionally, a few Marin crop producers had to import water by truck to keep crops alive and fallowed approximately 150 acres, or about 50% of the 300 crop acres in the county.

“As the region enters its third year of drought, this season is going to take a significant toll on our agricultural industry,” Parnay said.

The Board of Supervisors last year approved $150,000 in drought relief funds for the agricultural industry and another $250,000 for general drought relief needs to augment other state and federal aid.

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Antonio‌ ‌Ray‌ ‌Harvey‌

California Will Be First State to Break Down Black Employee Data by Ethnic Origin

Recently, disaggregation of Black data has been a top priority for some Black lawmakers and advocates supporting reparations for Black descendants of American slavery in California. In January, Assemblymember Chris Holden (D-Pasadena), introduced AB 1604, the Upward Mobility Act of 2022, legislation that will require the state to breakdown the data of state employees by ethnic origin.

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Disaggregated data refers to the separation of compiled information into smaller units to clarify underlying trends and patterns.
Disaggregated data refers to the separation of compiled information into smaller units to clarify underlying trends and patterns.

By Antonio Ray Harvey, California Black Media

When Gov. Gavin Newsom presented the annual May revision of his budget proposal for the next fiscal year, he announced that California will establish new demographic categories when collecting data pertaining to the ethnic origin of Black state employees.

Kamilah A. Moore, the chairperson of the California Task Force to Study and Develop Reparation Proposals for African Americans, said the breakdown of data is “amazing news.”

“California will become the first state in the nation to disaggregate data for its Black population by ancestry/lineage,” Moore posted on her Twitter page on May 13. “This will assist the task force in our efforts to develop comprehensive reparations proposals for descendants.”

Disaggregated data refers to the separation of compiled information into smaller units to clarify underlying trends and patterns. Newsom’s actions are similar to a bill authored by then-Assemblyman Rob Bonta.

In September 2016, former Gov. Jerry Brown signed Assembly Bill (AB) 1726 into law that required the state Department of Public Health to separate demographic data it collects by ethnicity or ancestry for Native Hawaiian, Asian, and Pacific Islander groups.

Recently, disaggregation of Black data has been a top priority for some Black lawmakers and advocates supporting reparations for Black descendants of American slavery in California. In January, Assemblymember Chris Holden (D-Pasadena), introduced AB 1604, the Upward Mobility Act of 2022, legislation that will require the state to breakdown the data of state employees by ethnic origin.

The Assembly Committee on Appropriations is currently reviewing the bill.

AB 1604 promotes mobility for people of color in California’s civil services system and requires diversity on state boards and commissions. Newsom vetoed AB 105 last year, the legislative forerunner to AB 1604, which Holden also introduced.

Shortly after he was appointed chair of the Assembly Committee on Appropriations in January, Holden reintroduced the legislation as AB 1604.

Holden, a member of the California Legislative Black Caucus, said AB 1604 will give the Reparations Task Force more accurate data to utilize in its study and deliberations. The bill was passed by the Assembly Committee on Public Employment and Retirement on March 14.

In a written statement released in October last year, Newsom said he vetoed AB 105 because “the bill conflicts with existing constitutional requirements, labor, agreements, and current data collections efforts” but found disaggregation useful for dissecting data about California’s workforce.

As stated in his 2022-2023 May revision of the state budget, under the section titled “State Workforce Demographic Data Collection,” Newsom proposed the separation of Black employee data beginning with the state’s 2.5 million-plus employees.

The Department of Human Resources (CalHR) will work with the State Controller to establish new demographic categories for the collection of data pertaining to the ancestry or ethnic origin of African American employees.

The collection of this data, the document states, “continues CalHR’s duties to maintain statistical information necessary for the evaluation of equal employment opportunity and upward mobility within state civil service.”

In March, the nine-member Task Force to Study and Develop Reparations Proposals for African Americans decided with a 5-4 vote that lineage will determine who will be eligible for reparations.

The May revision also includes $1.5 million in funding for the Department of Justice to continue supporting the work of the Task Force to Study and Develop Reparations Proposals for African Americans

Supporters of disaggregation say it will serve as a key tool for the task force as it enters its second year of studying slavery and its lingering effects on African Americans.

The state’s reparations task force will recommend what compensation should be and how it should be paid by July 2023.

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Bay Area

SoCal Group Holds Black-Themed Commencement, Presents Scholarships for Local High School Grads

The Buffongs say 694 students signed up for the Black graduation event their company held in conjunction with the Cooperative Economic Empowerment Movement (CEEM) and a myriad of other sponsors. In addition to celebrating the students’ achievements, the Buffongs say the event held at the Los Angeles County Fair Grounds in Pomona introduced members of the class of 2022 to culturally significant career, social and civic opportunities.

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More than 670 Black graduates from various high schools come to a special graduation at the Los Angeles County Fairgrounds in Pomona on May 13, 2022.
More than 670 Black graduates from various high schools come to a special graduation at the Los Angeles County Fairgrounds in Pomona on May 13, 2022.

SoCal Group Holds Black-Themed Commencement, Presents Scholarships for Local High School Grads

By Aldon Thomas Stiles, California Black Media

This past weekend in the Inland Empire, a San Bernardino couple welcomed hundreds of African American high school graduates from the region for a joyous multi high school, Black-themed graduation celebration.

“Sometimes we have students doing magnificent things and nobody sees them,” said Keynasia Buffong, co-founder of Buffong Consultation Solutions, the company that organized the celebration honoring graduates from various high schools in the area.

Keynasia Buffong co-owns the firm with her husband Jonathan Buffong. The couple wants to expand the mass graduation event to all regions in the state.

“When you come into your community, we see you. We recognize you,” Kaynasia Buffong continued.

The Buffongs say 694 students signed up for the Black graduation event their company held in conjunction with the Cooperative Economic Empowerment Movement (CEEM) and a myriad of other sponsors.

In addition to celebrating the students’ achievements, the Buffongs say the event held at the Los Angeles County Fair Grounds in Pomona introduced members of the class of 2022 to culturally significant career, social and civic opportunities.

Black Greek organizations attended the weekend-long event as well as the first Black valedictorian of Beaumont High School where African American students make up a little under 7% of the student population.

“We got a chance to give away $27,000 in scholarships,” said Keynasia.

Both Buffongs are educators and student advocates in California. They have been hosting the graduation event appreciating Black students for over 11 years.

But the Buffongs say celebrating success always comes with a reminder of the challenges Black students face.

According to the California Department of Education, at 72.5%, Black students had the lowest high school graduation rate among all other racial or ethnic groups at the end of the 2020 to 2021 academic year.

Jonathan said one of their goals is to help graduates transition into the next stage of their academic life, whether that be a four-year university, community college, trade school, or employment.

“Sometimes they don’t know where to go or what to do,” said Keynasia. “There’s mentorship and sponsorship and we aim to have both.”

For the scholarship awards, the Buffongs are not just looking at grades but the full context of the graduates’ lives.

“Whether it’s COVID, deaths, family or health issues, disabilities, we’re looking for things to support them on so we can get them to the next level,” said Jonathan.

Outside of academic and career success, the Buffongs spoke about the importance of Black cultural exposure through education and traditional practices such as the Black national anthem and a libation ceremony.

The libation ceremony is performed by an elder in the community as a way to honor one’s ancestors. It is significant in various African cultures as well as other cultures around the globe.

The Buffongs say their next step is to look into more internship opportunities and figure out how to help curb the high numbers of Black high school graduates who leave the state to pursue opportunities elsewhere.

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