After years of working in government policy, Michael Negron knows what the Hispanic business community needs, and as assistant director of the Illinois Department of Commerce and Economic Opportunity, he’s in a position to help do something about it. And if ever there was a time for help, this is it.
When you look at indicators such as death rates and frequency of hospitalization, there’s no doubt the Latinx community was harder hit than most by the coronavirus pandemic, Negron said. The Latinx business community is no exception, he added.
A couple of months ago, people thought the worst of the pandemic was passed, he said. Now there is a national resurgence in cases in Southern and Sun Belt states, he said, and it looks as though what started as a short-term, unusual recession is threatening to become a self-perpetuating, typical recession. And the more prolonged the public health crisis is, the more problematic the situation becomes for businesses with fewer customers and sick workers, he said.
He said he believes another federal aid package is critical, especially for local governments, which are essentially not taking in any revenue.
“The Paycheck Protection Program was written as if all of this would be over in 12 weeks,” he said. Recent announcements of potential autumn job cuts, such as 34,000 people at United Airlines, are timed to begin when the federal aid money ends, he said.
While Illinois has been doing well from a public health standpoint, it is still linked to the national economy. “We are not immune to a more severe downturn in California or Florida,” he said.
No easy money
When the Paycheck Protection Program was approved, the Trump administration needed partners to make it work, he said, and those partners were the big national banks. But when they made loans, it was to their existing customers, which perpetuated the Latinx community’s historical lack of access to capital.
The federal CARES Act gave access to additional funds, Negron said, and last month his department launched one $60 million portions of the $636 million business interruption grant program.
There is another $200 million in the pipeline, he said. Negron’s department is designing that program now and is looking for a partner to help distribute the money. Part of the next program will include significant outreach to make sure the funds are distributed equitably, he said. Equity is at the heart of Gov. JB Pritzker’s vision for Illinois, he added.
“We know it isn’t enough to post some applications and send out some emails,” Negron said. “We have to be thoughtful about how this outreach is done.”
DCEO has allocated funds for disproportionately impacted areas and is working with Latinx-community organizations — including The Resurrection Project and the Illinois Business Immigration Coalition — to create a structure to reach more Latinx business owners. By the same token, the next federal aid package needs to be very intentional about giving help to small businesses, he said.
“We’re doing what we can with the funds we have available,” he said. “But ultimately the federal government has significantly more ability to put funds into program.”
Often business owners seem reluctant to ask for help, but they shouldn’t be reluctant, especially in this business climate, Negron said.
In his department is Diana Alfaro, Liaison to the Latinx Business Community in the Office of Minority Economic Empowerment, who can answer questions and connect businesses with resources.
There are also 42 Small Business Development Centers around the state, which can provide technical assistance to connect to financial and government programs. These are funded by the DCEO and hosted by various partners. In Chicago, for example, there are SBDCs at the Illinois Hispanic Chamber of Commerce, the Little Village Chamber of Commerce, and a newly opened one at the Puerto Rican Cultural Center.
There’s more to successfully navigating the pandemic, Negron said. “Part of getting through this crisis is just adopting the right public health measures.”
With the state Health Department, DCEO issued a set of best practices that businesses can follow to mitigate the pandemic and also mitigate the effect on themselves.
Negron has a personal connection to his work for Latinx businesses. His mother immigrated to the United States from Guatemala, his father is from Puerto Rico, and he grew up in Humboldt Park and Galewood neighborhoods.
“One reason to be in this job is to put an equity lens on how we support development,” he said.