City’s new business recovery program seeks to create equitable distribution of $10 million in loans

The Sacramento City Council on Tuesday approved the framework for the $10 million Small Business Recovery Program to financially assist local businesses and nonprofits that have been impacted by the COVID-19 pandemic.

The program will provide up to $25,000 in forgivable loans and technical assistance to businesses and nonprofits located in the City of Sacramento to assist with financial needs and in the retention of employees.

The Small Business Recovery Program will be funded by $10 million of the $89 million the City received from the federal stimulus bill, known as the CARES Act.

“The forgivable loan program aims to ensure an equitable distribution throughout the City of Sacramento to assist local businesses that have been affected by the COVID-19 pandemic,” said the City’s Economic Investment Manager Leslie Fritzsche. “That is why the City has committed to distribute at least 75 percent of funds to economically disadvantaged communities.”

City staff will be providing eligibility and process information to local businesses, community-based organizations, PBIDs and Chambers of Commerce to ensure there are no barriers for businesses to apply including creating translated materials and hosting webinars in various languages.

The application period will be from Monday, June 29 through Monday, July 13. Once the application window closes, applications will be screened using specific criteria followed by a lottery/random draw. Funding is expected to be disbursed to selected businesses in early August.

Criteria and program details were established together with City Council, Mayor, Chambers of Commerce, Property Business Improvement Districts (PBID) and community-based organizations to ensure an inclusive program process.

Loan program details are outlined below:

Program Overview

  • Up to $25,000 per business/nonprofit in a forgivable loan.
  • Available for businesses with 25 or fewer full-time equivalent employees (FTE) as of March 1, 2020 — part-time employees are included within a FTE calculation.
    • A minimum of 25% will be made available to microbusinesses (5 or fewer FTE).
    • 75% of the funding will be targeted to businesses within an economically disadvantaged area (defined as CDBG Low/Mod areas overlayed with Promise Zone/Opportunity Zone areas).
  • Funds may be used to cover the day-to-day operating expenses of the business such as payroll, rent, inventory, insurance and equipment for technological improvements.


  • For-profit, independently owned local business and nonprofits with up to 25 FTE
  • Physical establishment within the City of Sacramento
  • Home-based businesses that have more than 3 FTE and child-care businesses
  • Locally controlled franchises are allowed as long as the franchise owner/controlling interest owns less than 3 franchises in the City
  • Evidence of current City of Sacramento Business Operations Tax Certificate (BOTC) (if required by City requirements for BOTC) at time of execution of loan agreement
  • Business must have been in business 12 months as of March 1, 2020
  • Annual business revenues less than $3 million gross revenue
  • Demonstrated hardship such as a loss in revenue due to COVID-19 health restrictions

The technical assistance components of the Small Business Recovery Program will be presented to City Council for approval on June 30.

Want to learn more? The City is hosting a webinar to learn about the forgivable loan program, eligibility requirements, application process an how to apply. Join us on Wednesday, June 24 at 2:00 p.m. Register here.

Find more information on the program here.

Businesses interested in learning more about the loan program are encouraged to call the Small Business Hotline at (916) 808-7196 or

Stay up to date on COVID-19 relief announcements by signing up for emails from the Office of Innovation and Economic Development here.

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