Gov. Janet Mills’ administration will dedicate $40 million for grants to small businesses in the state’s economic sectors facing the worst economic conditions because of the coronavirus pandemic.

The first-come, first-served grant program announced Monday is open only to businesses in three specific sectors: accommodation/food service, entertainment/recreation and retail trade. Tasting rooms, restaurants, bars, shops, hotels and inns, theaters and entertainment venues are among the businesses that are included. They have been among the worst affected by the coronavirus pandemic and have had the largest share of job and revenue losses.

Some restaurants made it through the summer and fall by expanding outdoor seating, and some lodging and tourism businesses benefitted from a surprisingly busy tourism season. But for many, summer earnings may not be enough to support them through the rapidly approaching winter when outdoor seating becomes less viable and a worsening pandemic will likely hurt sales and force some establishments to consider shifting back to takeout only or close altogether.

“In the face of this unrelenting pandemic, many of these businesses have adapted with classic Maine grit and resilience but still face historic and unprecedented challenges,” Mills said in a statement.

“I hope this program will help provide at least a small amount of financial support to sustain them through these difficult times. I continue to urge Congress to pass additional robust relief for Maine people and businesses.”

The grants will be funded with federal coronavirus relief funds provided to the state this spring. The state is under a Dec. 30 deadline to spend its remaining federal funds.

In August, Mills pledged $200 million in economic relief to small businesses and nonprofits in the state. About 3,500 grants totaling almost $160 million were issued over two phases of the program. The average grant awards have been between $43,000 and $45,000. Hospitality businesses represented the largest block of grant awardees.

Applications for the latest grants will be available Wednesday and will remain open until all the funds are spent. Awards will be based on the gross sales loss between March and September compared to the same period last year, according to the Department of Economic and Community Development. Eligible applicants may be awarded up to $20,000.

Businesses need to demonstrate at least a 20 percent loss of sales to be eligible and must have gross sales of $24,000 to $12 million in 2019. Establishments that previously received state grants are eligible to apply for the program as long as they still show a loss even with the grant funding factored in.

Grant funding can be used to cover expenses such as payroll, utilities, rent and mortgage, protective equipment and reopening costs.

In a statement, the head of Maine’s restaurant and lodging industry group encouraged businesses to apply.

“I’m pleased the grants are targeted specifically for hospitality, tourism and retail businesses because they represent the hardest hit sectors of Maine’s economy,” said Steve Hewins, president and CEO of Hospitality Maine.

“This funding will help more businesses survive until we can start returning to more normal times, and we urge qualified businesses to act quickly before the funds are exhausted.”

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