Kansas to forgive hospitality loans for small businesses

Published: Feb. 23, 2021 at 12:22 PM CST
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WICHITA, Kan. (KWCH) - Kansas Governor Laura Kelly announced Tuesday that bridge loans taken out by small businesses through the Hospitality Industry Relief Emergency (HIRE) Fund will be converted to grants.

The announcement means the funds will no longer need to be paid back, and businesses that have made repayments will be reimbursed.

Gov. Kelly and Lt. Gov. David Toland made the “significant economic recovery” announcement from Jenny Dawn Cellars in Wichita. The business is the first urban winery in Wichita, and its owner, Jennifer McDonald, is the first African American female winemaker in the state of Kansas.

McDonald said Jenny Dawn Cellars opened its location downtown Wichita in November of 2019. By March of 2020, just four months later, the business was forced to shut down its tasting room for three months due to the COVID-19 pandemic. McDonald said her business had to pivot services and offer to-go orders, online shipments and curbside pickup. She said April was the month they generated the least amount of revenue.

“Like Jenny Dawn Cellars, other restaurants, bars and wineries, we were all going through these same struggles, we wanted to keep our businesses afloat but didn’t have the revenue to do so. With this funding, we were able to survive this pandemic,” said McDonald.

She said she had to furlough some employees but was able to bring them back thanks to the money she received through the HIRE fund.

The HIRE Fund was established in March of 2020 to provide immediate relief to Kansas hospitality businesses faced with revenue losses due to COVID-19. Through a working capital loan program, NetWork Kansas delivered $5 million to 344 businesses in communities statewide, including 68 in Wichita.

Carlos Vera, co-owner of Taco Locale in Wichita, said the loan he received last year from the HIRE Fund helped keep his restaurant’s doors open.

“It allowed us to keep operating during the toughest and most unpredictable time since we didn’t know what was going to happen in regards to the pandemic,” he said. “It was definitely what we needed.”

He said the announcement that those loans will now be turned into grants, meaning they don’t need to be paid back, is a huge financial relief.

All HIRE recipients will receive an email with details on the process and timeframes involved with the grant conversion. The Department of Commerce will notify the partners/organizations that are assisting with collections to stop collections and forward all funds to NetWork Kansas for reconciliation.

Businesses can expect the process of issuing repayment and other paperwork to be completed in the next 30 days.

Kansas Gov. Laura Kelly will be in Wichita Tuesday to make a

Lt. Gov. David Toland will accompany the governor at the announcement at Jenny Dawn Cellars at 1:15 p.m.

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