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Road to Recovery

by Savannah King

Far from just a public health crisis, the COVID-19 pandemic has also been a unique economic crisis. From the start, leadership in Washington state took to the helm and played a pivotal role in helping businesses and residents navigate the challenges brought on by the pandemic. 

The Washington State Department of Commerce jumped into action to deliver aid and support companies, local governments, Tribes, nonprofits and households across the state. We recently spoke with Chris Green, Assistant Director of the Office of Economic Development and Competitiveness at the Washington State Department of Commerce. In the following interview, Green shares his perspective on the lessons learned and health of the state’s business climate. 

We’re approaching the two-year mark for the COVID-19 pandemic. As you reflect on Washington’s handling of the unprecedented challenge, how would you say the state fared compared to others? 

CHRIS GREEN: It’s difficult to compare Washington with other states in this regard. The pandemic has placed significant strains on all state and local governments, but no two are the same. That said, we are proud that we have been able to leverage federal and state funds to help the businesses most affected by public health orders. Some industries will face challenges for years to come, notably hospitality and tourism. We’re fortunate to have a very diverse economy, so the pandemic didn’t cause as much widespread economic havoc as it could have. But there’s a lot of work to do as we look to the recovery and rebuilding of those sectors most affected by this global event, especially our small businesses.

What steps did Washington take to help mitigate the effects of the pandemic on businesses?

GREEN: The first step was to take the necessary measures to protect our citizens from a public health crisis where information was scarce. I think history will show that we successfully kept our residents safe while keeping the economy going. Small businesses were affected disproportionally, and the state initiated Working Washington grants in excess of $526 million to help these businesses, particularly in rural and historically underserved communities. We also created a new Small Business Flex Fund to help businesses restart, offering low-interest, long-term loans. The pandemic created a unique opportunity to partner with other organizations, government agencies, non-profits and the private sector in ways we have never done before. This has created a lasting network of organizations that can provide technical support and assistance in our communities going forward. This has allowed us to put boots on the ground in communities that were often overlooked economically from a state perspective.

Of course, the wheels of commerce continue to turn – even in a global pandemic. What companies or sectors are growing and continuing to invest in the state?

covid-quote

GREEN: It’s challenging to make sweeping statements since some sectors have been relatively unaffected by the pandemic while others are still at the beginning of their recovery stage. For instance, our technology and life science sectors experienced growth during the last two years while the hospitality sector continues to struggle. Manufacturing and retail are still experiencing global supply chain disruptions that they are still working through. To effectively gauge our recovery, Commerce developed a new dashboard to track key metrics, giving us multiple ways to measure the recovery from different views, including comparing Washington with other states. It is located at www.commerce.wa.gov.

What are some of the primary concerns companies have in this landscape and how is the state helping to address these?

GREEN: Access to knowledge and capital continues to be a concern. We’re working to address these concerns both from a global innovation and competitiveness and a small business standpoint. To help entrepreneurs start small businesses and small business owners restart and recover, we created a series of tools on our MyStartup365.com website, including an Entrepreneur Academy and Restart Academy. ScaleUp has been another success story, allowing businesses to master key competencies related to human resources, operations and finances. Hundreds of companies across the state have been able to take advantage of these free programs. To maintain and improve position on producing the global innovative products of the future, we’ve also invested in new models for economic development, including our Innovation Cluster Acceleration Program, aimed at providing the launch of new cluster organizations across various industries to bring together private, public and academic sectors along with small businesses and capital fund managers. This is a somewhat new approach to the well known cluster concept and we’re also pleased to see more programming from the federal level in and around this space. 

What lessons were learned through navigating this pandemic and how will those lessons improve the state’s business climate? 

GREEN: Even though this pandemic put tremendous strains on our economy, we have learned some valuable lessons that will have a lasting impact. This includes the importance of collaboration with key partners, many who operated in silos before COVID.

These partnerships will continue to strengthen our economy going forward, providing investors and businesses with a coordinated network of experts who can connect them to technical assistance, funding opportunities, programming and knowledge. Additionally, the pandemic has made our businesses more robust and more resilient. When times are good, it’s easy to overlook activities that may increase risk. COVID has caused many companies to reassess historic vulnerabilities that either put their operations at unnecessary risk or were roadblocks to exponential growth.

What do you most want corporate decision-makers and site selectors to understand about doing business in Washington – both today and into the future?

GREEN: Washington has a long history of creating amazing things that have changed the world, from affordable jet travel to the way we think about coffee. We have a culture of collaboration and creativity that I think is pretty unique in the U.S., if not the world. We continually rank at the top of business surveys, such as Startup Genome’s recent ranking that placed Seattle’s startup ecosystem at No. 10­ in the world! Our focus on equity, diversity and inclusivity going forward will create new opportunities for investors and businesses that want to be at the leading edge of their respective sectors. We are blessed to have a diverse, resilient economy that can absorb changes in the world economy and even benefit from them.

Is there anything specific you’d like to highlight about the state’s COVID-19 response or recovery?

GREEN: I would say equity and resiliency are two of our main areas of focus in the year to come. We have a unique opportunity to create an inclusive economy that allows every resident the chance to start and operate a successful business, earn a living wage and contribute to the state’s recovery and growth growing forward. There is a lot of work to do on this, but I think that our economy and its many partners are well-positioned for significant growth in the years to come. 

ROAD TO RECOVERY

by Savannah King

Thanks to the state’s solid leadership and careful consideration, Illinois has safely and successfully navigated one of the most challenging years in modern history. Throughout the COVID-19 pandemic, Governor JB Pritzker and other leaders across the state carefully followed the guidance of data and health experts and is now on the path to restoring and revitalizing the state’s business climate. 

Shortly after the pandemic and subsequent global lockdowns began, Illinois enacted its five-phase plan to “Restore Illinois.” The framework was designed to save lives and livelihoods and currently all regions of the state have officially reached Phase 5, which allows all sectors of the economy to reopen and resume normal operations. 

BIG Help for Small Business

One of the biggest ways the state worked to keep small businesses on track throughout the pandemic was through the newly developed Business Interruption Grant (BIG) program. BIG — the largest program of its kind in the nation — provided $580 million in economic relief for small businesses hit hardest by COVID-19. The program leverages federal funding provided by the CARES Act and consisted of $290 million for child care providers and $290 million for other small businesses. 

In 2020, the Illinois Department of Commerce & Economic Opportunity helped thousands of small businesses throughout the state. Some of the hardest hit sectors include restaurants, taverns, gyms, museums and venues. Businesses located in downstate communities were also prioritized for funding with $105 million or 3,100 awards provided to those communities.

“Small businesses are the backbone of their local communities, providing essential goods and services to Illinois residents across the state. Due to the ongoing COVID-19 pandemic, too many of those businesses are facing tough choices about the future, which is why my administration worked quickly to launch the historic BIG program to provide the relief business owners need,” said Governor JB Pritzker. “Through BIG, the state was able to provide nearly 9,000 grants to small businesses in every corner of the state, with nearly half of all grants going to businesses in industries and communities hardest hit by COVID-19. Over $275 million in funding has been dispersed, allowing businesses to make payroll, purchase PPE, and cover other necessary operational costs. While the BIG program has now concluded, my administration continues to provide other relief programming for Illinois businesses and families impacted by COVID-19.”

The average grant award was $30,000, and businesses that didn’t receive other forms of assistance through programs like the PPP loan were given priority. Four out of every five grants were awarded to businesses with less than $1 million in annual revenue.

Additionally, 40%, or over 3,600 awards, were made to minority-owned businesses statewide.

The assistance came at just the right moment for many small business owners who used the funds to make payroll, purchase PPE, pay vendors and even make a few improvements. 

“Receiving the BIG Round 2 grant, provided relief for our business after all, we can see the light at the end of the tunnel, “ said Jose Hernandez co-owner of Diamond Garden Banquet Hall in Chicago.  “The grant has helped our business pay for a couple months of mortgage, utilities and payroll.”

“The Illinois Business Interruption Grant came at a crucial time for our business,” said Spenser Ng, owner of Triple Crown Restaurant in Chicago’s Chinatown community. “It has allowed us to keep our employees at work, while keeping us in good standing with our suppliers.”

Stronger and Healthier 
After Pandemic

As the state continues to recover and improve following the pandemic, Governor Pritzker and other legislators are creating a careful plan to balance the books while stimulating economic growth and jobs. In June, Gov. Pritzker signed a $42.3 billion FY22 state budget that leverages $1.5 billion from the state’s allotment of the American Rescue Plan Act. 
Illinois is expected to receive $8.1 billion in federal relief over the next three and a half years. The state’s FY22 budget allocates $2.8 billion of the funds, including $1 billion in capital projects, toward pandemic-recovery-related government programs, services and projects.

The budget will also allow for major investments in the governor’s key priority areas of education, health care, public safety, human services, criminal justice reform and ongoing pandemic relief, while fully funding the state’s pension contributions.

“The Fiscal Year 2022 budget is a responsible balance — addressing the pain of the pandemic, while investing in a thriving future for the people of Illinois,” said Governor JB Pritzker. “Business relief, housing stability, childcare support, these are the pillars of a recovery that is inclusive of working families. After the most difficult year in memory, Illinois is making a major comeback — and doing so with a level of fiscal prudence not seen in our state for two decades.”