NEWARK, N.J. (CBSNewYork) -- The city of Newark is taking new steps to boost the local economy.
It's now partnering with several groups to launch a $100 million investment fund to help Black and Latino business owners, CBS2's Kiran Dhillon reported Monday.
Business owner T Strong opened Studio Sole in Newark earlier this year. At times, it has been difficult to get capital for her sneaker consignment store.
The coronavirus pandemic hasn't helped.
"There aren't as many customers as there once was," Strong said. "Banks don't want to loan us. Not sure if it's Newark in general or the color of our skin."
To help small businesses like Strong's, Newark has partnered with several groups to launch a new investment fund. In addition to major corporate sponsors, Newark native and basketball great Shaquille O'Neal is also a partner in the fund.
So far, $2 million of the $100 million fund have been raised. The goal of the fund is to reduce the large racial wealth gap that exists in the community.
"We have an ocean of prosperity, but some of us are drowning in poverty," Mayor Ras Baraka said.
A report by Prosperity Now released in October 2019 found the median household income in Newark for Black families was about $32,000, around $34,000 for Latino families, and about $49,000 for white households.
Meanwhile, the unemployment rate sat at 15.8% for Blacks, 7.9% for Latinos, and 6.2% for whites.
The mayor said the money won't eradicate the systematic racism that has created the disparities, but it's a good start.
"We can no longer just paint slogans, or do ceremonial or symbolic events or even defund police. We need major steps to have equity and repair," Baraka said.
The city said businesses with $2 million or less in revenue with majority minority owners will qualify. Loans or equity investments will be given out over the next three years, and will be repayable over the next seven.
A variety of companies and financial institutions have already invested. The Rev. Al Sharpton said the fund is a win-win for everyone.
"Those corporations that invest in this are investing in themselves. Because the more stable a community is, the more viable your business is," Sharpton said.
Business owners call the fund a game changer.
"It's an amazing idea. I think it's absolutely necessary. I don't think that we will be able to thrive through this pandemic without it," Strong added.
The city said the applications will be available for business owners to apply in 60 days.
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