LEDA Recovery Grants
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Questions? Email LEDA@nmfa.net or call (505) 992-9696
What are the LEDA Recovery Grants?
The LEDA Recovery Grants were created by the State of New Mexico in the 2021 Legislative Session by House Bill 11 to provide $200 million in grant funding to New Mexico small businesses that are experiencing financial hardship due to the pandemic. These grants are specifically tied to job creation, must be used as reimbursements of rent, lease or mortgage payments, and are prioritized based on the severity of economic decline experienced by the business. This program is administered by NMFA on behalf of the New Mexico Economic Development Department.
What is a grant? A grant is money given for a specific purpose without any obligation to repay the funding. In this case, the grants are based on job creation. Unlike a loan, a grant does not need to be paid back.
Who can apply for a LEDA Recovery Grant?
- A business operating in New Mexico
- A business that has at least one but fewer than 75 full-time or part-time employees employed at any of the business’s locations
- A business that is current on all state and local tax obligations, and
- A business that experienced a decline in business revenue between comparable quarters in taxable years 2019 and 2020
Are nonprofit organizations eligible to apply?
I don’t report wages to the DWS or pay unemployment taxes. Am I still eligible to apply?
No. Businesses must report wages to the DWS and pay unemployment taxes to be eligible to apply.
If my business has temporarily closed, am I still eligible to apply?
Does the business have to be owned by New Mexico residents?
No. The business has to be physically located in New Mexico.
I didn’t have any employees before the pandemic. Am I eligible to apply?
No. A business must have had at least one employee as of October 1, 2019.
How does the program work?
- Grant applications are due no later than June 15, 2021 for the first application round.
- Grant applications will be prioritized after the close of the application period. The prioritization will be based on the revenue decline experienced by a business during the pandemic. Businesses with more severe revenue declines will receive higher priority.
- The only eligible expenses that a grant can be used for are reimbursements of rent, lease, or mortgage payments for the building occupied by the business. The grant amount cannot exceed the rent, lease, or mortgage payments paid during the grant period.
- The grant amount is based on a combination of the revenue decline experienced by the business, the number of new full-time-equivalent (FTE) positions hired, and the hourly wages of the new positions.
Businesses will use the following employee (FTE) counts in the grant application:
- The lowest number of employees during the pandemic in either of two specified quarters, as follows: this number will be found on the DWS ES903A report for either December 31, 2020 or March 31, 2021, whichever is lower.
- The highest number of employees. This number will typically be pre-pandemic and will be found on a DWS ES903A report from January 2019 to the date of the application.
- To qualify for a grant, a business must hire new FTEs over the lowest employee count. The total number of FTEs projected in the grant application, including new employees, cannot exceed the highest employee count.
- Grants will be paid on a quarterly basis, with no more than 25% of the total grant award being paid during any quarter. Businesses must meet their job creation projections before receiving future, quarterly grant payments after the first payment.
- At least $150 million in grant funds will be available in the first funding round. At least $100 million will be reserved for businesses in urban areas and at least $50 million will be reserved for businesses in rural areas. Urban areas include Albuquerque, Santa Fe, Las Cruces, Rio Rancho, and the immediate surrounding area. All other areas are considered rural areas.
- $20 million has been set aside for businesses that were required to be closed as of February 26, 2021. These businesses are identified by their NAICS code and include bars and clubs, entertainment and performance venues, convention halls, theaters, racetracks. A separate funding round will be held for these businesses.
How do I apply?
When will the application be open?
The application is expected to open May 11 and close June 15, 2021. The grants are not first-come, first-served, but we encourage you to apply with enough time to correct your application if needed. Applicants should submit only one application. Duplicate applications will not be reviewed.
How do I project the number of employees to be hired?
In the application you will provide a list of the positions you have hired since April 1, 2021 and a projection of the positions you anticipate hiring through March 31, 2022. This list will include the job title, the estimated number of hours each week the employee will work, and the hourly wage to be paid.
What employee numbers are important in the application?
- Highest number of employees – this is the highest number of employees a business had prior to and during the pandemic, from January 1, 2019 to current date. The total employee count including job creation goals in the application cannot exceed this number.
- Lowest Number of Employees – this is the lowest number of employees a business had during the pandemic taken from the quarter ending December 31, 2020 or March 31, 2021. The total employee count including job creation goals in the application must be higher than this number.
How is “employee” defined?
Employees include those that are paid wages by the business that are reported to the Department of Workforce Solutions on the DWS ES903A report.
Who may submit the application?
The application must be submitted by the “Authorized Officer” designated in the application.
When will the application be open?
The application will open May 11, 2021 and close June 15, 2021. All applications must be received no later than June 15, 2021 for the first application round.
The grant applications will be prioritized and grants will be awarded after June 15, 2021. The grants will be awarded based on the prioritization, not on a first-come, first-served basis.
Required Documents in an electronic format
Please note: You may use the upload link in the application more than once if needed for your required document uploads.
What documents do I need to submit with my application?
- 2019 or 2020 business federal tax return. An extension will not be accepted.
- Evidence of revenue decline, as evidenced by one of the following:
- Copies of CRS reports from any quarter in 2019 and the corresponding quarter in 2020. Businesses that file CRS reports monthly should provide the reports from all three months in the quarter they choose. Business that file semiannually or annually should include the CRS reports for the quarter they choose.
- 2019 and 2020 federal tax return
- For businesses that do not file CRS reports and have not yet filed a 2020 federal tax return, you may submit the business’s bank statements and invoices for the months comprising any quarter in 2019 and the corresponding quarter in 2020.
- Copy of the rental, lease, or mortgage agreement term sheet that evidences past, current, and future payments due
- Proof of rent, lease, or mortgage payment for the entity’s place of business in New Mexico. Acceptable documents include a bank statement, canceled check, credit card receipt, or ACH transfer.
- Front and back of a government-issued photo ID with the address of the authorized officer
- Copy of the DWS ES903A report from December 31, 2020 or March 31, 2021 to evidence the lowest number of employees, plus
- A supplemental payroll report that includes total hours for all employees to correspond with the DWS ES903A chosen to evidence the lowest employee count. Report Template
- Copy of the DWS ES903A report from any time period between January 2019 and September 2020 to evidence the highest number of employees, plus
- A supplemental payroll report that includes total hours for all employees to correspond with the DWS ES903A chosen to evidence the highest employee count. Report Template
Required Documents - Additional Information
Is a 941 report an acceptable substitute for a ES903A?
No. A business must submit ES903A reports that have been filed with the New Mexico Department of Workforce Solutions.
I haven’t filed my 2020 taxes. Can I still apply?
Yes, as long as you can provide us with your 2019 federal tax return and as long as you are evidencing your revenue decline using CRS reports instead of tax returns.
I don’t file CRS reports. Can I still apply?
Yes. You will need to provide your 2019 and 2020 federal tax returns or bank statements and invoices for the quarter chosen in 2019 and the corresponding quarter in 2020.
I file my CRS reports monthly instead of quarterly. How do I show the quarterly revenue decline?
Choose the quarter to evidence the revenue decline and add the revenue from all three months in that quarter. Be sure to use the same quarters for 2019 and 2020.
If my business has a separate FEIN but has a parent company that files the ES903A reports, what documentation is needed to evidence the highest and lowest number of employees?
Submit the ES903A reports that the parent company filed with the NM Department of Workforce Solutions and designate how many of the employees in the overall report are for your business.
Grant amounts are determined by two factors:
- The rent, lease, or mortgage payments that a business makes for its building. The grant amount will never be more than the amount of these payments.
- A calculation based on revenue decline combined with the number and type of jobs created by the business. See below for the calculation.
Grant Amount Calculation: The Grant Amount is equal to (the Base Grant Amount plus Wage Bonus) multiplied by (the number of new FTEs).
Base Grant Amount: The base grant amount is determined by the revenue decline from 2019 to 2020, as follows:
Revenue decline Base grant amount
Less than 20%: $5,000
20% to less than 40%: $7,000
40% to less than 60%: $9,000
60% to less than 80%: $11,000
80% and higher: $13,000
Businesses that pay a higher average wage for their new FTEs are eligible for wage bonuses as follows:
Average wage of over $13/hr: $1,000 bonus Average wage of over $17/hr: $2,000 bonus
Definition of FTE
FTE means “full-time-equivalent” employee, which is an employee that works 40 hours per week. An employee that works less than 40 hours per week can be considered a percentage of an FTE. For example, an employee that works 20 hours per week is a 0.5 FTE; an employee that works 10 hours per week is a .25 FTE, etc.
The application will calculate the amount based on the information you submit.
What is the maximum grant amount a business can be awarded?
- The maximum total grant award is $100,000. The maximum distribution per quarter is $25,000.
- The grant amounts paid to a business can’t be greater than amount of rent, lease, or mortgage payments for the business.
Should tips and commissions be included in the average wage?
If the tips and commissions are included in your payroll reports, they should be included in the hourly wage calculation. If they are not in your payroll reports, they should not be included.
Use of Grant Funds
What expenses can I pay with this grant?
Eligible expenses are reimbursement of rent, mortgage, or lease payments on the building occupied by the business. These are the only eligible expenses for this grant. The grant amount paid will not exceed the amount of rent, lease, or mortgage payments during the grant period.
How will those expenses be evidenced?
Applicants will provide a copy of the rent, lease, or mortgage agreement for the business. The agreement must include the past, current, and future payments that are in the grant application. In addition, applicants will provide evidence of the actual payments made, including bank statements, canceled checks, credit card statements or receipts, ACH transaction, or other proof of payment.
What’s the schedule for the grant payments?
- The first grant payment will be up to 25% of the grant award and will be disbursed after the agreement is signed.
- Reimbursement requests for subsequent payments will be made on a quarterly basis. These reimbursements will be up to 25% of the grant award and will be made only if the business has met the hiring goals in the application.
- A business can skip one or more quarters if it hasn’t met its hiring goals and submit the reimbursement requests in subsequent quarters.
How do I find my NAICS code?
On your federal tax return or Form 990, your NAICS code is called “Business Code.” Your business NAICS code can be located on the following tax forms:
- Sole Proprietors – Form 1040 Schedule C: page 1 Box B
- Partnerships, LLC’s, LLP’s etc. – Form 1065: page 1 Box C
- S-Corporation – Form 1120S: page 1 Box B
- Corporation – Form 1120: page 4 line 2a
- Non-Profit – Form 990: page 9, line 2a-e
Will the grants be first-come, first-served?
No. Grant applications will be prioritized based on the applicants’ revenue decline. Grants will be awarded based on the prioritization.
When will the grant awards be made?
The grant awards will be made after the application deadline of June 15, 2021.
What is a grant?
A grant is money given for a specific purpose without any obligation to repay the funding. Some grant programs have specific requirements that must be met. In this case, the grant funds are based on a business meeting specific job creation goals. This grant does not need to be paid back.
Can new or start-up businesses apply?
No. A business had to have been in operation on or before October 1, 2019 in order to apply.
Can an owner apply for multiple businesses?
Yes, as long as the businesses have different Federal Employer Identification Numbers (FEIN).
Set asides for future applications
What is set aside for businesses that hadn’t been able to open at the time the program was created?
$20 million is available for businesses included in the NAICS Code categories below. A separate funding round will be held for these businesses. Businesses in these categories may apply in any of the funding rounds.
Business Type and NAICS Code
Bars and clubs: NAICS Code 722410
Large entertainment venues and theaters: NAICS Codes 512131, 711110, 711120
Convention Halls: NAICS Code 561920
Performance venues: NAICS Code 711211
Racetracks: NAICS Code 711212
Concert venues: NAICS Code 711310
Phone: (505) 992-9696