San Diego’s City Council on Wednesday approved a $6.1 million relief package for city businesses with 100 workers or fewer that can demonstrate they have suffered financially from the COVID-19 pandemic.

The package includes grants and loans ranging from $10,000 to $20,000 that will be disbursed on a first-come, first-served basis. City officials said they hope to begin processing applications Friday and doling out funds in two weeks.

Because most businesses are expected to receive only $10,000, the program could help nearly 600 businesses stay afloat during the crisis, city officials said. But most will probably need additional help from other sources, they said.

The program is not open to nonprofits, businesses with more than 100 workers or businesses that opened within the last six months. It’s also not open to chain stores or restaurants — even if they are owned by a local franchisee.


Businesses must have had 100 workers or fewer on Feb. 28. The goal of that stipulation is eliminating businesses that were larger than that before the crisis.

Other businesses that aren’t eligible include insurance companies, home-based businesses, golf courses, race tracks, gambling facilities and lending and investment institutions.

Mayor Kevin Faulconer said the program, which the council approved unanimously Wednesday, will help struggling businesses retain employees, pay bills, sustain operations and fill critical service orders.

“This is money they need now to survive and in this emergency and to help keep San Diegans employed,” the mayor said. “This is vital to helping our community make ends meet during this time of great need.”


To demonstrate eligibility, businesses must submit documents showing that they have experienced significant decreases in demand, income, orders or need for labor, said Christina Bibler, director of the city’s Economic Development Department.

The money can be used for rent, labor, utility bills or to buy materials to fill orders.

The money for the grants and loans was culled from other programs the city has been using to boost the local business community.

More than $3.3 million will come from federal Community Development Block Grant money, which must be spent in low-income areas. That money will be used for three-year forgivable loans of $10,000 to businesses with 12 or fewer workers.


That money also is restricted to businesses located in low-income areas and owned by people who meet income requirements, Bibler said.

The second pool of money is nearly $2.2 million from a small business “revolving loan fund.” That money will be used for low-interest loans of $10,000 to $20,000 for businesses with six to 100 workers. The interest rate will be 2.5 percent.

The third pool of money is $550,000 in grants from the city’s workforce development fund and money devoted to placemaking, an effort to spruce up blighted parts of San Diego. That will be used for $10,000 grants to businesses with 12 or fewer workers.

Bibler said the city plans to award all of the grant money before moving on to the loans.


The city has assigned 12 employees in the Economic Development Department to become experts on the program. Each business will be assigned one of those employees as a sort of “case manager.”

Documents required for the program will be available in both English and Spanish, and some of the 12 workers are bilingual, Bibler said. Documents will be available at sandiego.gov.

Kimberly Henson, who owns a local martial arts studio, praised the city for trying to help small businesses.

“At times like these no one wants to come through the doors,” Henson told the council.


Council President Georgette Gómez said the relief package was a key move for the city.

“Most of our small businesses have been forced to close, and countless San Diegans are losing work and income as we try to slow the spread of the virus,” she said. “Today, we let struggling residents and small business owners know that we have their back.”

Councilman Chris Ward agreed.

“Small businesses are the fabric of our local economy and crucial to the vitality of our neighborhoods,” he said. “They face a difficult road to recovery after this crisis which impacts them, their employees, and more broadly our entire community.”


But Ward said more efforts will be necessary.

“This is just a first step,” he said. “San Diegans will need major, systemic support at the state and federal levels that goes far beyond what we can do at the city level.”