$270k in Grant Funding for Mercer Island Businesses and Nonprofits

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The City of Mercer Island recognizes that the COVID-19 Pandemic has had a significant adverse impact on many of the Island’s small businesses and nonprofits. These organizations provide services, create jobs, generate sales tax revenue, and are vital to the Island’s quality of life and sense of community. As part of the recovery effort, the City is offering one-time grants to these organizations.

The Mercer Island COVID-19 Relief for Small Businesses Grant Program will assist organizations who have been significantly impacted by the COVID-19 Pandemic, including those organizations that were required to modify or close operations per the guidelines outlined in Governor Inslee’s Safe Start Washington Plan and other COVID-19 related mandates. With this grant program, we hope Island businesses and nonprofits can remain open, retain/hire employees, and stay in business to continue serving the Mercer Island community.

The program is funded entirely by CARES Act federal stimulus funds provided by the U.S. Department of Treasury to the State of Washington. Governor Inslee awarded local governments $300 million of the State’s CARES funding in early May and allocated an additional $125 million to local governments on August 31. On Tuesday, October 20, Mercer Island City Council approved the grant program and allocated $270,000 of the City's second round of CARES Act funding to it.

Keep reading for more program details and to apply.

Program Details

  • Grants will be awarded in a single amount that is expected to be no less than $5,000 to each recipient. The final award amount will be determined based on available funding and number of eligible applicants.
  • Grant recipients will be selected from a pool of eligible applications via a lottery system. All eligible applications will be sorted into three prioritization pools as described below. A committee comprised of City staff and City Council members will review the lottery selection and recommend grant awards to City Council for approval at its November 2, 2020, regular meeting.
  • Eligible expenses are those that will have occurred from March 1, 2020, to November 30, 2020, must be directly related to the COVID-19 Pandemic, and have not previously been paid for by other COVID- 19 relief grant/loan programs such as the Paycheck Protection Program.
  • Once awarded, grant recipients will be required to enter a Subrecipient Agreement with the City to enable the City to fulfill its reporting requirements for how the funds were spent.

Qualifying Expenses

Per guidance from the Attorney General’s Office, grant funds will be provided to organizations that can demonstrate that the grant will prevent the organization from closing permanently and/or will assist with costs to comply with public health guidelines. Grant funds can be used to cover the costs of business interruption due to the COVID-19 Pandemic because of required closures, voluntary closures to promote physical distancing, decreased customer demand, and other Pandemic-related disruptions due to the. Eligible expenses are those occurring from March 1 through November 30, 2020, and include:

  • Rent, mortgage, and non-City utilities payments for the business/organization brick-and-mortar location;
  • Payroll expenses (provided that those expenses have not already been reimbursed by other federal, state, county, or regional grants/loans such as the Paycheck Protection Program or the Economic Injury Disaster Loan);
  • Personal Protective Equipment (PPE) and/or sanitation supplies, equipment, and services needed to safely reopen;
  • Temporary or permanent changes made to business operations due to the COVID-19 Pandemic (e.g. pivoting to e-business and delivery, limiting in-store service, shifting to telework, etc.).

Grant funds may be taxable income. Recipients are advised to consult with their tax advisors for guidance. A 1099 Form will be issued to each grant recipient as required by the IRS no later than January 31, 2021.

Eligibility Criteria

To qualify for a grant, an organization must:

  • Be a small business (as defined by the US Small Business Administration size standards) or 501(c)(3) nonprofit organization, other than regional/national chain businesses and home-based businesses;
  • Have a customer-facing physical location within Mercer Island city limits;
  • Have been in operation as of January 1, 2020;
  • Have an active City of Mercer Island Business license and be in good standing with the City of Mercer Island and the State of Washington;
  • Demonstrate hardship due to the COVID-19 Pandemic, such as revenue loss, requirement to purchase PPE and other equipment, etc.; and
  • Be able to explain how funding can be used in the immediate term to stabilize or sustain your organization and/or benefit the public, such as jobs created/saved, amount of tax revenue created/maintained, and whether the grant would help your organization avoid bankruptcy or permanent closure.


The application opens Wednesday, October 21, 2020, at 9:00am, and closes Thursday, October 29, 2020, at 5:00pm. Before you apply, make sure you:

  1. Confirm your eligibility (see criteria listed above). If you are unsure of whether your organization is eligible, contact Sarah Bluvas at sarah.bluvas@mercerisland.gov.
  2. Locate your Mercer Island Business License number (UBI number) and verify that your license is up-to- date.

Once you confirm your eligibility and business license, apply online:


The application is also available to download here: https://letstalk.mercergov.org/5278/widgets/16591/documents/15094

If you choose to complete the paper application, please submit to Sarah Bluvas at sarah.bluvas@mercerisland.gov. Include "Mercer Island COVID-19 Relief Grant Program" in the subject line. Only one application per organization will be considered.

Remember, the deadline to apply is Thursday, October 29, 2020, at 5:00pm.

Other Useful Information

How will applications be evaluated?

City staff will evaluate applications based on the eligibility criteria outlined in this document. All eligible applicants will then be placed into a lottery system. Eligible applicants will be sorted into one of three pools according to the following priorities:

  • Pool 1: Businesses and nonprofits such as Food & Drink Establishments (restaurants, bars, etc.); Retail (boutiques, bookstores, specialty shops, florists, etc.); Personal Service Providers (hair salons, nail salons, estheticians, dry cleaners, etc.); Fitness Studios; Education/Childcare Service Providers (daycare, preschool, etc.); and Entertainment/Arts/Recreation Service Providers
  • Pool 2: Other businesses and nonprofits such as Professional Service Providers (financial services, real estate, architects, etc.) and Health & Wellness Providers (doctors, dentists, physical therapists, etc.)
  • Pool 3: All other eligible applicants

Funds will be allocated based on the priorities outlined above, with awards being selected by lottery in the following order:

  1. Select from Pool 1 by lottery until all funds are allocated or all Pool 1 applicants are awarded
  2. Select from Pool 2 by lottery until all funds are allocated or all Pool 2 applicants are awarded
  3. Select from Pool 3 by lottery until all funds are allocated or all Pool 3 applicants are awarded

Once the lottery selection is complete, a committee comprised of City staff and City Council liaisons will conduct a final review of the awards to ensure eligibility. The City aims to distribute the grant funds in accordance with the priorities listed above and to as many businesses as possible within the timeframe prescribed by the CARES Act.

Notification Timeline & Grant Disbursement

  • October 21: Application opens
  • October 29: Application closes
  • October 30-November 1: Lottery selection for grant recipients and internal review by City staff/City Council
  • November 2: City Council approves grant awards
  • November 3-15: City announces awards and contracts with grant recipients
  • December 2020: Funds distributed to recipients

Privacy Information

This application and any supporting documentation are considered a public record and may be subject to public disclosure under Washington’s Public Records Act, Chapter 42.56 RCW.

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