McKee says RI businesses need more help to adapt to COVID

Gov. Dan McKee's plan for spending more than $100 million of Rhode Island's federal aid starts with another effort to help small businesses adapt to life with COVID-19. 

That means a new round of grants to help restaurants bring more services outside, for shops to install new ventilation systems or for some of them to pivot to e-commerce.

McKee's small-business assistance plan is expected to represent more than $50 million of the $1.1 billion in American Rescue Plan funding the state received, with housing and child care receiving the remainder of the $100 million in initial funding this year. 

To spend the money, McKee needs the consent of the General Assembly, which has tightened the purse strings on federal coronavirus aid after deferring to McKee's predecessor in the first year of the pandemic. 

On Monday, McKee went to a restaurant in East Greenwich with hospitality-industry representatives to explain his rationale for the spending and drum up public support.

"Our small businesses did everything we asked them to do during this pandemic — they closed down, they took things outside, they opened up with capacity restrictions and masks, but they still need help," he said.

McKee's RI Rebounds funding would fall into six categories:

◘ Outdoor operations, similar to last year's Take It Outside campaign

◘ Ventilation-system upgrades

◘ E-commerce and tech upgrades

◘ Storefront façade and streetscape improvements

◘ Worker recruitment and training

◘ Special help for industries heavily damaged by COVID, such as tourism

In a phone interview Monday, state Commerce Secretary Stefan Pryor said most of the funding in the Rebounds plan would be grants distributed to businesses through intermediaries, such as the Rhode Island Hospitality Association or local chambers of commerce. Streetscape improvements could come through municipalities.

One exception is likely to be the direct grants to businesses in hard-hit industries, he said.

Rhode Island is the only state in the Northeast and one of the few in the nation not to spend any of its Rescue Plan money yet.

Examples of other states that have used their federal money to help businesses include Connecticut, $40 million for tourism and hospitality; Maine, $70 million for grants and loan guarantees; and Virginia, $250 million for tourism and hospitality.

Since lawmakers passed the annual state budget in June, McKee has been trying to get them to allow at least some of the American Rescue Plan funds. (His first proposal to use a portion to build a new state health laboratory on former Route 195 land was shot down.)

After little apparent progress, McKee penned a Journal op-ed last week asking for an initial round of funding for small-business assistance, child care and housing.

In a response to McKee's event Monday, House Speaker K. Joseph Shekarchi and Senate President Dominick Ruggerio called help for struggling residents and businesses "our top priority" but said they needed more specifics from the governor.

“On numerous occasions, we have told Governor McKee that he needs to submit a formal plan in the form of a supplemental budget if he believes additional expenditures of federal funds are necessary in the near-term," Shekarchi and Ruggerio said in a joint statement. "We can’t hold hearings without a formal proposal, complete with specifics.”

panderson@providencejournal.com

(401) 277-7384

On Twitter: @PatrickAnderso_