Help is not on the way, business owners hurt by Washington Bridge closure say 

HARUT MATKASYAN, owner of Riviera Restaurant in East Providence, was rejected when he applied to the U.S. Small Business Administration Economic Injury Disaster Loan program, which is supposed to help businesses hurt by the western Washington Bridge closure. RHODE ISLAND CURRENT / MICHAEL SALERNO

Harut Matkasyan watches cars back up from the Interstate 195 Washington Bridge to his East Providence restaurant with a growing sense of hopelessness. 

The streets are clogged, but his Portuguese restaurant and banquet hall on North Broadway feels empty. Also disappearing: his profit margin.  

Business remains down by more than one-third, four months after the abrupt, emergency closure of the westbound bridge in December. He has offered jobs to prospective employees only to be turned down due to the unpredictable, and often heavy, traffic.  

And state and federal aid programs that are supposed to assist small businesses like his aren’t helping at all. 

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“I don’t think the people that are making the decisions are knowledgeable about business, what we are going through and what we really need,” said Matkasyan, owner of Riviera Restaurant, in a recent interview. 

Case in point: the U.S. Small Business Administration Economic Injury Disaster Loan program, which opened Dec. 19 to help businesses hurt by the bridge closure. 

Matkasyan is among a slew of business owners who applied to the program, which offers loans up to $2 million at no more than 4% interest. In early March, he got an email saying he did not qualify.  

The reasoning: “Basically, they said in a very nice way, ‘you don’t need this,’” Matkasyan said. 

He was still smarting from the rejection when Gov. Daniel J. McKee announced a $2.5 million state relief package for small businesses on April 3. 

The state proposal includes $300,000 in direct grants to small businesses, using unspent federal relief aid from the pandemic. The remaining $2.2 million would be spent on a combination of technical assistance and beautification for businesses, along with a state marketing campaign and grants to municipalities for signage and sidewalk improvement projects. 

“What good is a marketing campaign going to do for me?” Matkasyan asked. “My taxes are still there, my expenses are not going away.” 

His lament was echoed by other small business owners, several of whom aired their grievances with lawmakers in a State House hearing before the House Committee on Small Business on April 3, hours after McKee announced the state small-business relief  package. 

“The state has failed us, and we need help to get through this time,” Asher Schofield, co-owner of Frog & Toad LLC, said during the hearing. “Small businesses feel they have an unwritten, unspoken contract with their government. This situation is a breach of that contract.” 

Since the bridge closure, Frog & Toad has seen business decline by 5%, a $20,000 revenue loss, he said. 

“That might not sound like a lot but for a small-time guy, that’s a lot of money,” Schofield said. “That’s money I can’t afford to pay my staff.” 

Schofield hasn’t applied for an SBA loan because he didn’t want to take on more debt. Other business owners he’d spoken with along Providence’s Hope Street shopping corridor felt similarly, he said. 

For those who applied, results appear mixed. 

Rick Simone, executive director of the Federal Hill Commerce Association and founder of a small business group called the Ocean State Coalition, said about half of the 30 businesses he’d helped with their applications were denied.  

“It’s been a giant failure,” Simone said of the SBA disaster loans. 

Also among the upset rejects: Jim Verity. 

Over the last 42 years, Verity had built a reputation for his niche, Providence business, Verity Design, which specializes in “experiential” design for weddings, birthdays, university events and more. He’d received a low-interest loan through the same SBA program during the pandemic. 

To learn that his business was “overqualified” for a new loan was, in his words, “baffling.” 

“It’s the first time in my entire life, in my business and personal experience, I was told my credit was too good for a loan,” Verity said. 

Especially given the toll the bridge emergency had taken on his livelihood. Each day brings a new stress: a contractor stuck in traffic for hours, waiting to get over the bridge to deliver decor for an event. As the minutes tick by, so do the dollars coming out of Verity’s books. Clients have canceled jobs, or stopped booking them, choosing instead to work with a competitor on “their side” of the bridge. 

And Verity anticipates it will only get worse. 

“When they tear that bridge down, our economy is going to get ripped in half,” he said. “We’re going to get hammered.” 

Alex Brown, owner of IT’S LIT RI, a marquee letter rental company, was also rejected for an SBA loan. He appealed the decision, offering additional documents like employee timesheets and emails from customers canceling jobs, which he hoped would help build the case for his need. 

“I felt a little offended,” Brown said of the rejection. “I don’t feel like they really listened or understood my line of business. We haven’t even seen the full effect it’s going to have, yet.” 

The SBA did not have any data available on how many businesses have applied for, received, or been rejected for the disaster loans. Tauheedah Mateen, a spokesperson for the SBA’s Office of Disaster Recovery and Resilience, said Friday that software problems were preventing the administration from being able to gather accurate information on applications to any of its programs. Even previously reported numbers may not have been accurate, Mateen said. 

Anita Steenson, another SBA spokesperson, said she encouraged businesses rejected for loans  to appeal for reconsideration. Steenson declined to comment further, explaining she could not speak to the reasoning for each individual loan decision. 

Frustrations were mounting by the time McKee stepped in with state relief programs. Seeking to soothe stressed business owners, Rhode Island Commerce Secretary Liz Tanner offered details on each of the programs during the April 3 State House hearing. 

“Gov. McKee is a small-business-minded governor,” Tanner said. “He understands the needs of small businesses.” 

But to the business owners, the way the proposed funding has been divided suggests otherwise. 

The largest chunk, $1 million, would be offered in grants to municipalities for sidewalk repairs, signs and other beautification projects as part of Rhode Island Commerce’s existing Main Street RI Streetscape Improvement Fund. Another $800,000 would help businesses with technical assistance and “placemaking activities,” using unspent federal pandemic aid. Rhode Island Commerce would repurpose up to $400,000 of its existing hotel tax revenue on a marketing campaign drawing attention to area businesses. The final, and smallest piece, is $300,000 in direct grants, also drawing upon unspent American Rescue Plan Act funds. 

“If they put all that money into actual grants, they won’t need a marketing campaign,” Verity said. “That money will go like wildfire through the community.” 

Rep. Carol McEntee, a South Kingstown Democrat and chair of the House Committee on Small Business, also suggested the money would be better spent on grants. 

“Things like new sidewalks, I am not sure that’s what businesses are worried about right now,” she said during the April 3 hearing. “Maybe they don’t need technical assistance as much as they just need money to keep them open through this difficult time.” 

Olivia DaRocha, a spokesperson for McKee’s office, said in an email Friday that proposal details are still being finalized, and must also be submitted to and approved by the Rhode Island General Assembly. 

Legislative approval is needed to change the parameters for state pandemic aid. Existing rules would exclude businesses that opened after the pandemic, and have not received other assistance. 

Since the recommendation involves money as part of the state’s fiscal 2025 budget, it will be considered as part of the review of the larger tax-and-spend plan, typically adopted in late June, Larry Berman, a House spokesperson said in an email. 

Which means business owners will be waiting another two-and-a-half months to even apply for state grants hardly the haste expected given the severity of the situation. 

“To wait until July, that sounds like a long time for businesses to keep having to tighten their belts,” Schofield said. “We’re a small state. That should come with more nimble practices.” 

Nancy Lavin is a staff writer for the Rhode island Current.

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