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LI minority-owned small businesses hit harder by pandemic, report says

Elsie Damus, who has owned Claudy's Beauty Supply

Elsie Damus, who has owned Claudy's Beauty Supply for 36 years, is shown in her Uniondale shop on May 14. Credit: Danielle Silverman

Like so many small Long Island businesses in the past year, Claudy's Beauty Supply in Uniondale faced unimaginable challenges brought on by the coronavirus pandemic.

Owner Elsie Damus and her husband, Claude, both were hospitalized with COVID-19. The shop closed for four months. Key corporate customers bailed out. Sales were down at least 80%, and reluctantly the family business decided it couldn't fund three annual scholarships for Uniondale High School graduating seniors.

Yet when Elsie Damus — a Haitian immigrant who founded the business 36 years ago — sought federal financial assistance from a local bank, she was turned down and told the shop was ineligible. No reason was given, the family said.

"If we don’t qualify as a minority business, as a woman-owned business, then who qualifies?" said Damus' daughter, Nancy Nemorin. "A small business like ours, how do we find out what we’re qualified for?"

The story was similar for minority-owned businesses all over the Island.

In a report released earlier this month, the Rauch Foundation found small businesses in a sampling of 30 major downtowns reported substantial income losses as COVID-19 spread across the Island.

The Garden City-based nonprofit said the problems were especially acute in minority communities. Although about 1% of downtown stores closed Islandwide, that figure reached as high as 10% in Central Islip, the nonprofit said.

The foundation said higher rates of COVID-19 infections in low-income areas were one problem. But businesses like Claudy's also struggled to get loans, develop online marketing and receive government assistance such as the federal Paycheck Protection Program.

"The technology available to some of the businesses in minority communities were not at the same standard or level as businesses not in minority downtowns," said Kevin Law, co-chair of the Long Island Regional Economic Development Council, which helped publicize the report.

"A lot of minority businesses had a tougher time accessing federal stimulus dollars that were being made available," said Law, who is also executive vice president of East Setauket developer Tritec Real Estate. "All of those things combined were like a triple whammy to negatively impact minority downtowns."

The Rauch Foundation report, prepared by Manhattan-based HR&A Advisors, included suggestions for 11 short-term and long-term "interventions" to support struggling downtowns, such as patronizing shops in crisis, loosening zoning regulations and updating aging business districts.

During a May 12 online forum to discuss the report, former Greenport Mayor David Kapell said the village helped its bars and restaurants by relaxing parking restrictions to permit outdoor dining.

"If we hadn’t done something, we were fearful we were going to have a ghost town come September," said Kapell, now a real estate broker. "The result was really dramatic" with some restaurants "reporting their best year ever."

Damus, 80, says she hopes it's not too late to save her business from liquidation. Her dream always has been to leave the shop for her children and grandchildren to operate — a dream that now seems tenuous at best, she said.

"I don’t want to close the business. The business is helping the community," Damus said. "I want to do the best of everything to keep this business going."

Rebuilding downtowns

Highlights of the Rauch Foundation's suggested "interventions" for saving struggling downtown businesses:

1. Financial support. Design new grant and loan programs, and remove barriers for accessing aid — especially in low-income and minority communities.

2. Economic development. Create small business support agencies, similar to New York City's Department of Small Business Services.

3. Technology. Help small businesses access broadband and free Wi-Fi; create online shopping portal modeled on Amazon.

4. Flexibility. Develop creative zoning to allow re-use of vacant storefronts.

5. The great outdoors. Make outdoor dining — in parking areas, sidewalks and plazas — a permanent feature of downtowns.

6. Open streets. Close downtown roads temporarily on some days to let pedestrians mingle and go window shopping.

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