Study shows federal PPP, small business loans failed to reach California's vulnerable communities

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Last year’s federal coronavirus stimulus package included the Paycheck Protection Program and forgivable small business loans.

But, at least in California, a new study says that may have led to the rich getting richer, and the poor getting poorer. The UCLA study said the coronavirus relief bill failed to reach the state’s most economically vulnerable neighborhoods, raising questions about how government programs target the neediest and, in turn, track their success.

"The pandemic devastated communities of color and they’ve really borne the brunt of the pandemic, not just in terms of infection and mortality, but job loss and economic devaluation," said Sonja Diaz, founding director of the UCLA Latino Policy and Politics Initiative.

The study looked at neighborhoods in the Bay Area, Los Angeles and the Central Valley. "What we found was that there were disparities in the number of jobs protected and the number and amount of dollars going into Californians’ pockets based on the color of their skin," Diaz said.

The "wealthier, more affluent Congressional districts" got more funding, Diaz added.

"There needs to be technical assistance so that minority-owned businesses, particularly those in the frontline of COVID-19, have access to the assistance, advice and technical strategy necessary to be successful in actually attaining these programs," she told KCBS Radio’s "The State of California."

This comes as California adjusts its COVID-19 vaccination plan to target the most underserved areas, which Diaz called "a game changer."

"We need to lead with equity because there’s no way to recovery in the State of California if we are not ensuring that our current and future workforce is healthy," Diaz said of the shift in strategy.

As part of the new plan, doses would be spread out among 400 zip codes at the bottom of the state’s Healthy Places Index, which measures factors including income, housing status, education and access to healthcare services. Currently, those communities are receiving about 17 percent of the state's vaccine supply.