A $500,000 grant program launched today will bring crucial relief to Kalamazoo’s smallest businesses hit hard by the economic fallout of the pandemic.

The Kalamazoo Micro-Enterprise Grants (KMEG) provides grants of $5,000 to eligible microbusinesses within the city limits. The grants are a partnership between the City of Kalamazoo and United Way of the Battle Creek and Kalamazoo Region.

KMEG funding comes from a $200,000 grant from the Consumers Energy Foundation and an additional $300,000 from the City of Kalamazoo’s Foundation For Excellence, pending Kalamazoo City Commission approval. The City and United Way also collaborated on the Kalamazoo Small Business Loan Fund, a relief effort that has issued more than $1.227 million in loans to 69 local businesses so far.

“This new grant initiative shows again how the power of partnership makes a difference,” said Chris Sargent, President & CEO of United Way BCKR. “We’re excited to apply our expertise in grantmaking to benefit this crucial business sector and Kalamazoo as a whole.”

Micro-enterprises, also known as microbusinesses, are very small businesses—typically 10 or fewer employees—that generate low revenue yet bring unique skills and services to the community. According to the U.S. Small Business Administration, micro-enterprises make up 74.8% of private sector employers. Many micro-enterprises are BIPOC (black, indigenous, people of color)-owned and/or women-owned. They are vital to income and wealth generation in underserved communities.

The grants aim to support community members living below the ALICE threshold, with a focus on providing support to BIPOC-owned and women- owned microbusinesses, which have experienced disproportionate effects from the COVID-19 pandemic.

“KMEG fills an important need in our community, helping the smallest businesses get help and persevere through this challenging time,” said Antonio Mitchell, Community Investment Manager for the City of Kalamazoo.

United Way will administer the grants. Businesses seeking KMEG grants must meet these requirements:

• be a for-profit company in an industry outlined in Executive Order 2020-21, or any previous and subsequent executive order of similar intent, or demonstrate it is otherwise affected by the COVID-19 outbreak;

• be located in the City of Kalamazoo;

• have 10 employees or fewer;

• have annual revenue of $1.0 million or less;

• been in existence for one year or longer;

• need working capital to support payroll expenses, rent, mortgage payments, utility expenses, or other similar expenses that occur in the ordinary course of business or that demonstrate an effort to support public health; and

• demonstrate an income loss as a result of the executive orders or the COVID-19 outbreak.

Priority consideration will go to BIPOC-owned and/or women-owned microbusinesses. Secondary consideration will go to eligible businesses located in Shared Prosperity Kalamazoo neighborhoods—Northside, Edison and Eastside.

KMEG funds can be used for, but are not limited to, operational costs (such as rent, mortgage, utilities and other ordinary business expenses), payroll and benefit costs for employees, financial effects from the pandemic and executive orders, and costs for supporting public health as a business reopens. Recipients must use their grant funds within six months and report back to United Way on how the funds were used.

Eligible businesses can begin applying for grants today at changethestory.org/micro-enterprise-grants. Applications are due by May 27 at 5 p.m. A review committee including United Way staff and diverse representatives from business, financial and community groups from across Kalamazoo will review applications and make decisions on funding by June 1. For questions, email smallbusiness@uwbckr.org.