California Small Business
COVID-19 Relief Grant Program

Eligible Businesses

A small business or small nonprofit must satisfy the following criteria to be eligible to receive a grant award:

1. Must meet the definition of a “qualified small business”. “Qualified small business” means a business or nonprofit that meets all of the following criteria, as confirmed by the office or fiscal agent through review of revenue declines, other relief funds received, credit history, tax returns, and bank account validation:

A. Is one of the following:

i. A sole proprietor, independent contractor, 1099 employee, C-corporation, S-corporation, cooperative, limited liability company, partnership, or limited partnership, with an annual gross revenue of less than five million dollars ($5,000,000), but greater than one thousand dollars ($1,000), in the 2019 taxable year.
ii. A registered 501(c)(3), 501(c)(6), or 501(c)(19) nonprofit entity that had an annual gross revenue of less than five million dollars ($5,000,000), but greater than one thousand dollars ($1,000), in the 2019 taxable year.
iii.A division or department of a larger organization or entity, such as a tribal government, city, county, or city and county.
iv. An organization that is fiscally sponsored by a nonprofit corporation.

B. Began operating in the state prior to June 1, 2019.
C.  Is currently active and operating, or has a clear plan to reopen when the state permits reopening of the business.
D.  Has been impacted by COVID-19 and the related health and safety restrictions, such as business interruptions or business closures incurred as a result of the COVID-19 pandemic.
E. Provides organizing documents, such as a 2019 tax return or Form 990, an affidavit from the board or authorizing official from the governing authority, detailing the governance structure; or a copy of an official filing with the Secretary of State or with the local municipality, as applicable, including, but not limited to, Articles of Incorporation, Certificate of Organization, Fictitious Name of Registration, or Government-Issued Business License.
F. Provides an acceptable form of government-issued photo identification, where applicable.

Ineligible Businesses

A. Businesses without a physical presence in the state and not headquartered in the state.
B. Businesses primarily engaged in political or lobbying activities, regardless of whether the entity is registered as a 501(c)(3), 501(c)(6), or 501(c)(19).
C.  Passive businesses, investment companies, and investors who file a Schedule E on their tax returns.
D. Financial institutions or businesses primarily engaged in the business of lending, such as banks, finance companies, and factoring companies.
E. Businesses engaged in any activity that is unlawful under federal, state, or local law.
F. Businesses that restrict patronage for any reason other than capacity.
G. Speculative businesses.
H. Businesses with any owner of greater than 10 percent of the equity interest in it who meets one or more of the following criteria:

i. The owner has, within the prior three years, been convicted of or had a civil judgment rendered against the owner, or has had commenced any form of parole or probation, including probation before judgment, for commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a federal, state, or local public transaction or contract under a public transaction, violation of federal or state antitrust or procurement statutes or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, or receiving stolen property.
ii. The owner is presently indicted for or otherwise criminally or civilly charged by a federal, state, or local government entity, with commission of any of the offenses enumerated in clause (i).

I. Affiliated companies, as defined in Section 121.103 of Title 13 of the Code of Federal Regulations.
J. Other businesses determined by the office, consistent with the limitations and exclusions set in Rounds 1 and 2 of the COVID-19 Relief Grant Program. “Rounds 1 and 2 of the COVID-19 Relief Grant Program” means the first two rounds of grant allocations awarded, prior to the enactment of this article, through the COVID-19 Relief Grant that is administered by CalOSBA and that is funded by Executive Order No. E 20/21-182.

How will grant receipients be determined?

Lendistry will analyze for selection all applications entered into the Portal. Lendistry will consult with the California Office of the Small Business Advocate (CalOSBA or the “office”) and design the program selection for prioritization of impacted businesses. Grants will be prioritized, to the extent permissible under state and federal equal protection laws, in accordance with the following criteria:

1. Geographic distribution based on COVID-19 health and safety restrictions following California’s Blueprint for a Safer Economy and county status and the Regional Stay at Home Order.
2. Industry sectors most impacted by the pandemic, including, but not limited to, those identified as in the North American Industry Classification System codes beginning with:
61 – Educational Services
71 – Arts, Entertainment, and Recreation
72 – Accommodation and Food Services
315 – Apparel Manufacturing
448 – Clothing and Clothing Accessory Stores
451 – Sporting Goods, Hobby, Musical Instrument, and Book Stores
485 – Transit and Ground Passenger Transportation
487 – Scenic and Sightseeing Transportation
512 – Motion Picture and Sound Recording Industries
812 – Personal and Laundry Services
5111 – Newspaper, Periodical, Book and Directory Publishers
3. Nonprofit mission services most impacted by the pandemic, including, but not limited to, emergency food provisions, emergency housing stability, childcare, and workforce development.
4. Disadvantaged communities tracked by socioeconomic indicators that may include, but are not limited to, low to moderate-income, poverty rates, unemployment, educational attainment, and other disadvantaging factors that limit access to capital and other resources.

Grants to eligible nonprofit cultural institutions will be prioritized on documented percentage revenue declines based on a reporting period comparing Q2 and Q3 of 2020 versus Q2 and Q3 of 2019.