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Last month, the Growing MI Business Grant Program report was released by the Michigan Department of Treasury.
The main objective of the program was to offer assistance to businesses that were adversely affected by the pandemic-induced shutdowns caused by COVID-19. The funding for this program was provided through the American Rescue Plan Act.
The most relief was received by Detroit’s three retail casinos among all the businesses that were granted assistance.
All three individuals were awarded the maximum possible amount of $5 million, surpassing any other business by more than double the amount.
How much money was awarded by Growing MI Business program?
The program received a funding of $409 million, and around $130 million worth of aid was requested by 8,329 businesses.
Out of all the applicants, 2,981 individuals were granted awards amounting to $117.3 million. Additionally, a total of 5,333 applicants did not receive any financial aid, while 15 individuals chose to withdraw or decline their awarded amount.
The range of awards ranged from $2 to $5 million.
Detroit Entertainment LLC, Greektown Casino LLC, and MGM Grand LLC were each issued $5 million.
The operators of MotorCity Casino Hotel, Hollywood Casino at Greektown, and the MGM Grand Detroit are represented by those.
Gov. Gretchen Whitmer and the legislature enacted a law that set the maximum award at $5 million.
The funds that were awarded were utilized for:
- Bring in more employees to fill the vacant positions.
- Improve or enlarge their business
- Enhance operations as they transitioned post-pandemic.
Why did the Detroit casinos get the most COVID relief money?
Businesses must have been operational prior to October 1, 2019 to qualify for any funds from the Growing MI Business Grant Program.
Companies that suffered considerable damage due to the COVID shutdowns were qualified.
In order to be eligible, businesses were required to demonstrate a minimum 5 percent decrease in total sales in 2020 compared to the previous year, with all funds obtained from the Paycheck Protection Program included in the calculation of total sales.
The maximum amount for the awards was determined based on the lower value between a business’ financial hardship or $5 million.
The financial hardship determination involved a combination of factors.
- 2020 property taxes
- If the business paid rent, 17 percent of the annual lease costs would be deducted.
- Half of the taxes for unemployment insurance.
- Liquor license fees
- Fees for licenses and inspections in other states
Retail casinos heavily impacted by pandemic nationwide
The casino industry across the country experienced a significant impact due to the COVID-19 pandemic.
The American Gaming Association reports that approximately 616,000 casino gaming employees were unable to perform their jobs.
The shutdown resulted in a staggering $105 billion worth of economic activities being lost, and states also suffered a loss of over $2 billion in gaming taxes.
In 2020, due to the pandemic, U.S. commercial casinos suffered a total loss of 45,600 business days. The entire industry experienced a significant 31% decrease in revenue compared to 2019.
Tax revenue from the three Detroit casinos in Michigan experienced a significant decline of 59.4% in the first half of 2020 compared to the corresponding period in 2019.
On March 16, 2020, casinos ceased operations, but they resumed activities on August 5 with a limited occupancy level of 15 percent.
What other businesses received aid
Nine types of businesses were eligible to apply under the Growing MI Business Grant Program.
- Entertainment venues
- Leisure facilities and public venues for entertainment
- Barbers and cosmetologists
- Exercise facilities
- Food service establishments
- Nursery dealers and growers
- Athletic trainers
- Body art facilities
- Hotels and bed & breakfast accommodations
Applications for aid were submitted by businesses in all 83 counties of Michigan, as stated in the report from the Michigan Department of Treasury.
Apart from the $5 million awards granted to the three Detroit casinos, the Amway Hotel Corp received the highest award of $2.4 million.
Food service establishments were the recipients of the highest number of awards, totaling 1,364. On the other hand, entertainment venues managed to secure a total of 175 awards.
With a remarkable achievement, Wayne County proudly garnered 471 awards, bringing in a substantial sum of $32,945,202. Surpassing all other counties in Michigan, it emerged as the top recipient of funds. However, Oakland County outshined in terms of the total number of awards, securing 615 grants totaling $19,214,952.
