North Stonington — A proposal to use $100,000 of the town’s remaining American Rescue Plan Act funds to aid small businesses impacted by the COVID-19 pandemic was approved unanimously with a 31-0 vote during a special town meeting Monday.

The assistance program is application-based and requires businesses to demonstrate that they meet at least one of the federal eligibility requirements for reimbursement.

Some qualifications for aid include whether the business endured a decrease in revenue, challenges covering payroll, rent or mortgage, and the business’s capacity to weather financial hardship. Other criteria for assistance include whether the business used loans or grants to mitigate financial hardship, technical assistance or counseling costs to support business planning, financial insecurity and increased costs of operation.

Additionally, only businesses that employ 50 workers or less were considered for grants, as the program is targeted at smaller businesses.

It’s estimated that between 125 and 200 businesses in the town could be eligible for financial relief under the program. Currently, award amounts are projected to be between $2,000 and $3,000, and no single business will be able to receive more than $10,000 in aid, according to Planning, Development and Zoning Official Nathan Reichert.

He said a copy of the application form, which contains the full list of eligibility requirements, would be sent to businesses and posted on the town's website, northstoningtonct.gov.

The grants are need-based and each application will be reviewed and decided upon by the Economic Development Commission. Reichert said that while he expects the commission to prioritize smaller businesses that were heavily impacted by the pandemic, businesses that endured fewer losses still could be eligible for reimbursement as well.

The EDC will accept applications for the relief program from July 1 through Sept. 1, 2022, and at a September meeting, the commission will start awarding grants to applicants. Following the EDC’s September meeting, applications will be considered by the commission on a rolling monthly basis. If there are any unused funds as of Dec. 31, 2024, the remaining ARPA money would be returned to the town.

Also at the meeting, the town approved the lease of a portion of 298 Norwich Westerly Road to an early childhood education center with a 28-0 vote. The town also voted to approve the use of $120,000 of its remaining ARPA funds to cover the operating expenses of 298 Norwich Westerly Road through June 30, 2022. The proposal was passed with a 29-3 vote and was meant to alleviate the burden that the building’s expenses would otherwise have on the town’s taxpayers, especially following the pandemic.

Additionally, the town approved a proposal that would allow the Board of Selectmen to take out up to $1,000,000 in loans if there were ever a shortfall of town funds. The proposal, which passed with a 29-3 vote, would enable the Board of Selectmen to take out loans only to cover expenses that were already approved in the budget by the Board of Finance. The proposal was described as an insurance policy that would empower the Board of Selectmen to quickly cover expenses in an emergency until the town could collect the tax money that was initially anticipated to cover them. Although this power was held by past administrations as well, it has never been used before, according to the Board of Selectmen.