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    NC Reopens Grant Program for Businesses Affected by COVID-19

    Yesterday, North Carolina reopened its Business Recovery Grant program for a second round of applications – this time targeting businesses that weren’t eligible the first time. 

    The original intent of NC’s Business Recovery Grant program was to assist businesses that had not received help from other state and federal programs like the PPP, automatically eliminating many. Businesses within the hospitality industry that had received other funding could apply for the NC grant, but they were only eligible for small grants, and that’s exactly what NC awarded to most recipients. As a result, more than $200 million of the original $500 million in grant money remains. 

    Phase 2 of the program, by contrast, loosens the restrictions considerably: Businesses that received other relief funds are no longer excluded, and all types of North Carolina businesses -- from farmers to sole proprietorships to corporations -- are invited to apply, as more common tax forms can now be used to determine gross receipts and the loss of revenue due to the pandemic. 

    The program is for qualified North Carolina businesses that experienced significant economic loss – 20% or more -- because of COVID-19.  

    Here’s what you need to know:  

    If you did not receive a grant in Phase 1: 
     
    This reopening (or “Phase 2”) authorizes two types of grants: 

    • A hospitality grant for eligible arts, entertainment, or recreation businesses, as well as an eligible accommodation or food service business such as a hotel, restaurant, or bar (NAICS code 71 and 72). 
    • A reimbursement grant for eligible businesses not classified in NAICS Code 71 and 72.

    According to the NCDOR, “The grant amount is a percentage of the economic loss demonstrated by the eligible business or $500,000, whichever is less. Economic loss is determined based on the amount the business’ gross receipts in North Carolina were reduced from the period March 1, 2019, through February 29, 2020 (“Pre-COVID Period”) to the period March 1, 2020 through February 28, 2021 (“COVID Period”).”  

     

    If you did receive a grant in Phase 1: 

    A business that received a grant in Phase 1 can still be eligible for Phase 2 funds provided ALL of the following are true: 

    • The business has gross receipts that were not reported on Form E-500. 
    • The business has gross receipts that were not reported on federal Form 1065. 
    • The grant the business received in Phase 1 was less than $500,000. 
    • The gross receipts on Line 5b of the Phase 2 application must be greater than the gross receipts on Line 8b of the Phase 2 application.  
     The combined Phase 1 and Phase 2 grant award for a business cannot exceed $500,000.  

    How to apply 

    The application to apply can be found here on the NCDOR’s website. The deadline is quickly approaching. Applications must be received by June 1, 2022. We encourage you to visit the NCDOR website to determine your eligibility and apply as quickly as possible.  

     

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