A city pandemic loan program intended to help out small businesses in lower-income neighborhoods and communities of color has left out a swath of Manhattan's Chinatown.
In late November, the city's Department of Small Business Services launched a $35 million low-to-moderate income storefront loan program. Small businesses in certain neighborhoods could receive up to $100,000 in a zero-interest loan. The funds would provide loans for at least 350 businesses across the city, depending on the size of loans allocated.
To qualify, businesses need to have fewer than 100 employees and be located in a low- to moderate-income ZIP code.
The ZIP code 10002 qualifies for the loans. But sections including Mott Street, Pell Street, and Doyers Street, and various blocks surrounding Columbus Park in neighboring ZIP code 10013 were omitted from the program. The ZIP code 10038 also excludes other sections of Chinatown and Two Bridges.
"My first initial reaction was that I'm sure this is some sort of administrative oversight. They didn't realize that 10013 is also a part of Chinatown," said Yin Kong, director of Think! Chinatown, a neighborhood arts and storytelling organization.
She proposed solutions like using census tract data to the SBS, to no avail.
"Our neighborhood could be left out again and again for future COVID relief programs as well," Kong worries.
The ZIP code 10013, which includes parts of SoHo and Tribeca, is often listed as among the wealthiest in the country.
But the city's population database shows one area in the omitted ZIP code—census tract 29—has a median household income of a little over $27,000 in parts of Chinatown that don't qualify for the new loan program. Nearly 42% of families rely on social security and almost 47% have used food stamp benefits in the past year in that area, census data shows.
Just north in census tract 41, which also covers parts of 10013, the median household income is around $79,000, but family income varies widely and about 24% of households rely on social security and 22% have used food stamps in the past year. The ZIP code issue was first reported by SinoVision.
The city's Department of Housing Preservation and Development considers the highest threshold for moderate incomes to be $122,880 for a family of three.
For the owner of Taiwan Bear House on Pell Street near Doyers Street, the loan would have been helpful after a year with reduced sales.
"I wish that we could be included because there are many small businesses like us that are struggling," owner Kris Kuo said.
Kuo's business got a federal loan, but the money has already been used.
Jan Lee, of the Chinatown Core Block Association, noted the loan program was framed as beneficial to communities of color in the agency's initial announcement.
"The loan is designed for minority communities and minority businesses. I don't understand how you can leave out Chinatown because you're using us in your publicity for your office," Lee said. "Using our faces, using our businesses, using us a backdrop for your supposed advocacy for minorities."
Christina Seid, whose father founded the Chinatown Ice Cream Factory on Bayard Street near Mott Street, felt the omission was part of a pattern of Chinatown getting left out of government aid programs.
"I don't see why a program that's supposed to be benefiting Chinatown is leaving out the main ZIP code that Chinatown is in," Seid said. "That's like the heart of Chinatown."
"When Chinatown was first developed, it's Pell, Bayard. That's the origins of Chinatown," she added.
Seid said her neighbors who may not speak English or don't have legal departments to take care of intensive paperwork for loan applications could face difficulties accessing such programs to begin with.
SBS spokesperson Shaina Coronel noted the LMI storefront loan program was designed to align with federal median income ZIP codes under the Department of Urban Housing and Development. Just 10% of small businesses in low-to-moderate income ZIP codes got federal PPP loans, she noted. Other East Asian communities across the city are included in the new loan program, according to the city agency.
The city says it has issued $7.45 million in grants and loans to Chinatown, Sunset Park, Flushing, Homecrest, Bensonhurst, Elmhurst, East Village, and Forest Hills.
Chinatown community groups and elected officials have been meeting with SBS to discuss the problem, most recently on New Year's Eve.
"I'm asking SBS for an explanation and urging that they include 10013 in the LMI storefront loan program—using ZIP codes alone misses businesses in need that straddle those boundaries," Manhattan Borough President Gale Brewer said in a statement.
But even if SBS does find a quick fix, Lee fears it will be too little, too late.
Last spring, the first SBS emergency grant program ran out of money within weeks. A federal potentially forgivable loan program, called the Paycheck Protection Program, also exhausted funds quickly and were heavily criticized for benefiting large corporations over small businesses. (Gothamist's parent company, New York Public Radio, received an $8.9 million PPP loan this year.)
SBS did not answer how much of the $35 million in the city loan program remains, but the agency said applications are still open and currently being processed.
Another Chinatown business in ZIP code 10013, dim sum banquet hall Jing Fong, had to cut its hours to three days a week in mid-March, well before the city went under a stay-at-home policy, due to lack of customers.
A manager at the famous Elizabeth Street restaurant Truman Lam said it's unlikely the restaurant would have applied to the new loan program even if ZIP code 10013 were included in it.
He already fears he'll have to pay back some of the business's nearly-depleted PPP funds since he anticipates it won't be fully forgiven.
"We're probably more inclined to not want to take on additional liability," Lam said. "What we really need [are] grants."