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COVID-19 Economic Response and Recovery

Support Incubators and Makerspaces

Why:

Such projects can be catalytic, helping entrepreneurs create businesses and existing businesses to grow, thereby building local wealth. By establishing and preserving affordable spaces for light manufacturing, business incubation, maker/artist studios, and cultural activities, cities can foster quality middle-skill job opportunities for LMI residents.


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COVID-19 Economic Response and Recovery

Revitalize Neighborhood Business Districts

Why:

In this way, you will make neighborhoods more livable, help retain essential services, and support household wealth building.

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COVID-19 Economic Response and Recovery

Provide Access to Funds and Resources for Tourism Businesses to Adapt

Why:

Keeping local, small businesses is critical for the recovery of your tourism economy. By helping them develop new online communications and sales channels, create new lines of business, or repurpose and adapt their space, you are helping to create longterm revenue solutions.

Do:

  • Do spend time building the trust and confidence of your member businesses.
  • Do regularly engage with your business owners and provide support based on their differing levels of digital literacy.
  • Do set aside considerable time at the beginning to sort out payments from Shopify to vendors.

Don’t:

  • Don’t assume any knowledge. Create stepby- step guides, and share information on how businesses can take good photographs, buy ads, and market their businesses on social media.

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COVID-19 Economic Response and Recovery

Provide Technical Assistance to Small Businesses

Why:

Since COVID-19, travelers, particularly younger travelers, have a heightened awareness of environmental sustainability and social and racial equity. As a result, they are more likely to look for evidence that destinations are taking steps to address these issues.


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COVID-19 Economic Response and Recovery

Issue Municipal Bonds to Offer Community Loans


Benefits:

  • Provides capital to people who may not be able to receive it (and at lower rates)
  • Stimulates demand in the local economy (e.g., providing capital to residents to purchase homes)

Risks:

  • Requires financial expertise to implement
  • Assumes additional financial risk during a period of economic crisis

Impact: High
Implementation time: Low
Cost: High. Issuing the loans will require money to be set aside for the program, although repayment should enable the city to recapture investment. Some FTE will need to run the program, though vetting of loans should be done by professionals.


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COVID-19 Economic Response and Recovery

Leverage CDFIs to Deploy More Capital

Why:

By partnering with CDFIs, banks, and philanthropy to develop tailored loan programs, you can extend your impact, even during a time of austerity.

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COVID-19 Economic Response and Recovery

Level the Playing Field for City Contracts

Why:

In this way, you will build local supply chain capacity, build pathways to wealth creation, and keep money local.


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COVID-19 Economic Response and Recovery

Invest in Adaptation

Why:

Keeping spending local is critical for economic recovery. By helping businesses meet the needs of surging resilient sectors, develop new sales channels, or create new lines of business; you are creating longer term revenue solutions than subsidies and loans.


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COVID-19 Economic Response and Recovery

Give Preference to Local Businesses for City Contracts

Risks:

  • Raises concerns among larger businesses that compete with small and local businesses
  • Needs to be accompanied by proper technical assistance for local businesses (e.g., access to capital, technical expertise) to ensure they are able to fully leverage opportunities
  • Can cause problems for businesses looking to compete in surrounding communities (if all implement this)
  • Could lead to higher cost of goods and services due to preferences which may mean more expensive suppliers, wages, etc.

Benefits:

  • Keeps government spending local, reducing leakage and increasing overall economic activity in the city
  • Supports local businesses and enables them to compete for government contracts
  • Provides structured mechanisms for local businesses to obtain a reasonable advantage in contracting

Impact: Medium
Implementation time: Medium
Cost: Low. The preference program itself is not expensive, although it may require several FTE to provide technical assistance and oversight.


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COVID-19 Economic Response and Recovery

Establish a Midsize Business Support Program (e.g., up to $250k loan)

Benefits:

  • Enables local businesses to access funds and expand faster
  • Offers flexibility for businesses, particularly if they are applying for larger government or commercial contracts
  • Investments in growing local businesses can provide significant job growth for local communities

Risks:

  • Assume financial risk of supporting loans
  • Can be problematic if offered without support programs (e.g., financial counseling, entrepreneurial culture)

Impact: High
Implementation time: Medium (pilot), Low (full program)
Cost: High. Although the actual cost of the program may be lower (e.g., issuing loans and receiving payback) it will seem high because it requires expenditures each year, even though it will be repaid. If offering loans between $50K – $250K, and assuming several FTE to run the program, it could cost over a million a year even for a smaller program.


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