California can’t overlook a critical group in its COVID-19 recovery effort: Street vendors

In perhaps the most pleasant paradox of the COVID-19 pandemic, California has emerged with a mammoth $75 billion budget surplus. Coupled with $25 billion in federal CARES Act aid, there is no reason anyone should be left out of the Golden State’s recovery.

Our neighborhood fruteros, hot dog hawkers, ballgame merch dealers and ice cream cart pushers have been left out and overlooked by recovery efforts. It’s time to change that.

As lawmakers in Sacramento pore over Gov. Gavin Newsom’s budget proposal, it’s imperative we fill the gaps left by earlier rounds of relief. The economic pain has not subsided for many businesses, and the budget bonanza will only prove a true windfall with a surgical focus on what was missed in 2020’s emergency efforts.

The proposed budget makes several smart allocations for small businesses, including an additional $1.5 billion for the California Relief Grant program (bringing the total to $4 billion), $147 million for the Main Street Small Business Tax Credit and $95 million to jump-start California’s tourism industry. This is in addition to a $6.2 billion tax cut approved in April.

CAMEO, California’s statewide micro-business network, knows these programs will be vital to getting entrepreneurs back on stable financial footing. The Golden State’s more than 4 million small businesses represent 99% of all enterprises in California and employ 7.2 million people, nearly half of the state’s private workforce.

Street vendors are the epitome of small businesses. According to the LA Street Vendor Campaign, the 50,000 street vendors in Los Angeles County earn, on average, $228 a week — $11,308 a year. They are outside the typical networks for aid and often missed by traditional financial institutions and government services.

The proposed Micro Business Relief Fund, supported by the mayors of Los Angeles, San Francisco, Oakland, San Diego, San Jose and Sacramento, is the type of direct approach needed to deliver aid to small entrepreneurs on the margins. Proponents are asking the Legislature for a one-time expenditure of $50 million for street vendors, who reported a 50% reduction in sales during the pandemic. Each business owner would be eligible for a $5,000 grant, and local jurisdictions could augment the funding.

Due to administrative and practical barriers, street vendors and other very small businesses are habitually overlooked when governments serve up business assistance. Immigration status, English-only instructions and lack of formal business documentation and internet access can discourage a vendor from filing an application.

For example, the aforementioned $4 billion California COVID-19 Relief Grant Program was inaccessible for many street vendors in the informal economy. To qualify for a grant, businesses must present official filings with the state or local municipality and provide specific forms of government-issued photo ID. Recognizing these factors, the new proposed fund was recently endorsed by a half dozen mayors from some of California’s largest cities.

Targeted support to very small businesses will deliver aid to some of the most underrepresented business owners. Of the 50,000 street vendors in LA County, roughly 80% are women, and the majority are people of color, immigrants, seniors and low-income individuals. Street vending is a common avenue for immigrants, women and people of color to start a businesses and support their families, in many cases serving as a launch pad for bigger endeavors. In San Francisco, popular Mission District brick-and-mortar restaurants Reem’s and El Buen Comer both came from women who grew their businesses at local farmer’s markets.

Including the Micro Business Relief Fund in the budget sends a strong message from the state’s lawmakers: No one in California, regardless of the size of their business, will be left out of the recovery.

This story was originally published June 14, 2021 at 10:37 AM.