Ahead of Election Day, Nov. 8, and in a bid perhaps to win over his future constituents in New York’s redrawn 15^th Congressional District, Rep. Ritchie Torres has said one of his highest priorities is to provide small businesses with access to capital. The Democratic congressman was speaking at a virtual forum held on Thursday, Oct. 13, hosted by Biz2Credit, an NYC-based lending company for small businesses. Torres appeared as a guest alongside Long Island Republican, Rep. Andrew Garbarino.

 

“One of my strongest priorities is to ensure that we are doing everything we can in Congress to support the recovery of small business[es], which is the beating heart of the American economy,” Torres said. “We have to ensure that small businesses have access to capital. That’s going to be a priority of mine going forward.”

 

The forum was moderated by Rohit Arora, CEO of Biz2Credit. Torres and Garbarino both gave short opening statements before answering selected questions from the audience. (Upon registering for the forum, Norwood News sent through a question about the congressman’s plans for economic development in Norwood, but it was not asked during the event.)

 

Torres, who is a member of the congressional financial services committee, said small businesses in the service and retail industries have been struggling since the pandemic. “I’m in New York where the entrepreneurial spirit is alive and well, but what translates the entrepreneurial spirit into an actual business is access to capital,” he said. “That’s where we need to do more work.”

 

Torres said there was a shortage of lending sources for small businesses. “We have a system where larger banks have an incentive to make large loans to large businesses, and small businesses tend to get left behind,” he said. The Bronx congressman also said that the federal government needed to do a better job communicating with local communities about pre-existing opportunities to receive aid.

 

“Most of these programs are poorly marketed and exist as an abstraction, and people fail to feel them in their real lives,” he said. “I feel like we, in the federal government, have to do a better job of communicating.”

 

The congressman also expressed his concern about “aggressive” interest rate increases by the Federal Reserve to combat inflation. According to reporting by Vox on Sept. 8, when inflation goes up too much, one of the main policy tools employed by the Federal Reserve to slow things down is to raise interest rates. This makes borrowing more expensive, thus cooling off demand. However, this, in turn, can increase unemployment.

 

Meanwhile, as reported by The Guardian on Oct. 16, experts say that raising interest rates ‘isn’t working’ (in terms of reducing inflation) and that the real culprits are corporate pricing, energy costs and supply chain issues.

 

The NYS Seed Grant Program application window is now open. Early-stage small businesses can apply for grants of up to $25,000. Don’t miss out on this opportunity to get COVID-19 relief for your business!

— EmpireStateDev (@EmpireStateDev) September 30, 2022

Tony Ghazali, owner of ‘Anthony’s Famous Gourmet Deli’ located on East Gun Hill Road in Norwood, told Norwood News by phone that increased supply chain prices have indeed forced him to raise prices, which is hurting sales. “Everything is expensive and nobody’s buying nothing,” the deli owner said, adding that the federal government should do what it can to reduce prices.

 

Torres said he was concerned that such “aggressive” interest rate increases could harm employees, make it more difficult for unestablished businesses to access loans, and not do much to reduce prices.

 

Torres said five interest rate increases by the Federal Reserve this year have had a “minimal” impact on inflation. “I’ve expressed to the chair of the Federal Reserve the concern ‘that if we are too aggressive at raising interest rates, we risk the worst of both worlds: inflation and high unemployment, stagflation’,” Torres said. “We have to tread carefully.”

 

Michael Brady, chair of the legislative affairs committee for the Bronx Chamber of Commerce and CEO of the Third Avenue Business Improvement District (BID), appeared to concur that raising interest rates made it more difficult for small businesses to access capital through loans because the interest rates are higher.

 

“Inflation is still up and it’s also becoming more and more costly for small businesses to borrow money,” Brady said. “As the [Federal Reserve] tries to get inflation under control, they’re raising the interest rates and that is essentially to pump the brakes on consumer spending. However, that’s also constricting accessibility to capital for small business owners. So, it’s a bit of a double-edged sword.”

 

Brady also said the federal government should be offering more “low threshold, character-based” loans to small businesses.

 

“If small businesses are not able to get a business loan from a regular commercial bank because the interest rates are so prohibitive, there should be an entry point that is more accessible to small businesses who may not have a strong credit score or who may not have the appropriate revenue-to-debt ratio that folks are looking at,” he said.

 

After the two congressmen left the forum, Arora instructed the audience to complete a multiple-choice survey on their biggest concerns as small business owners. According to the results,, 27 percent responded, saying, “high inflation and supply chain disruption,” 35 percent responded, saying, “lower revenue due to pandemic/economic effects,” 16 percent responded, saying, “rising interest rates and financing costs,” 11 percent selected “trouble hiring the right employees,” and nine percent selected “not a business owner.”

 

Meanwhile, in other small business-related news, The Bronx Chamber of Commerce recently shared an update on a $250 million COVID-19 Capital Costs Tax Credit Program by New York State’s Empire State Development (ESD) agency. The new program provides financial assistance to New York State small businesses burdened with a range of operational costs stemming from the COVID-19 pandemic. These may include structural changes and building upgrades to health-related supplies and materials.

The program offers qualifying businesses relief from the added economic burden by providing tax credits to help reduce the pandemic-related financial impact. Small businesses can receive a tax credit of 50 percent of qualifying expenses, up to a maximum of $25,000 in tax credits based on qualifying expenses of $50,000.

 

Additionally, the chamber also shared the news that NYC Department of Small Business Services (SBS) has launched a new grant program to support small Business Improvement Districts across the city, comprising two grant options.

 

A single district grant directly provides funding to place-based, nonprofit organizations that are currently addressing commercial corridor recovery, management, and growth within the boundaries of an existing Business Improvement District (BID) or Special Assessment District (SAD) in New York City, with an annual assessment of less than or equal to $600,000.

 

Meanwhile, a citywide grant provides funding to nonprofit organizations for the development and deployment of technical assistance programs, capacity-building resources, and back-office services for the collective benefit of multiple Business Improvement Districts and Special Assessment Districts with annual assessments less than or equal to $1,000,000.

 

More information about the Small BID Support Grant program and applications can be found at here, and the deadline for both grant programs is Sunday, Oct. 30. The Bronx Chamber of Commerce is also hosting a grant information session on Thursday, Oct. 30, at 3 p.m. explaining how to apply for funding for neighborhood businesses. Visit the events page of the Bronx Chamber of Commerce for more information.

 

Seed grants for small businesses are also available from Empire State Development. More information on the program can be found here.

 

Effective Jan. 1, 2023, the congressman’s new district will include some or all of the north and central Bronx neighborhoods of Norwood, Woodlawn, Riverdale, Fieldston, Spuyten Duyvil, Williamsbridge, Olinville, Eastchester, Allerton, Edenwald, Pelham Gardens, Van Nest and Morris Park, in addition to the southern Bronx neighborhoods he already represents.

 

On the other hand, he is losing some southeast Bronx neighborhoods including Hunts Point, Castle Hill, Clason Point, Unionport and parts of West Farms. Torres faces Republican challenger, Stylo Sapaskis, in the upcoming general election. Early voting commences on Oct. 29.

 

*Síle Moloney contributed to this story.