After the April riots, the city rolled out a $1 million loan program to help small businesses affected by the unrest downtown and in Over-the-Rhine.

        As of Dec. 18, the city had cut checks for only four loans worth $187,000 — the result of a “logjam” in processing the applications, federal red tape and, perhaps, a lack of interest from small business owners.

        But as Monday's deadline approaches and the long-term costs of the riots become clear, the city can barely keep up with the demand for applications.

        In just the past week, Councilman Chris Monzel, who has been pushing the program, has received more than 50 inquiries or requests for applications — many of which he had hand-delivered to business owners.

        He said many business owners may have forgotten about the loan program, or didn't understand the eligibility requirements.

        “I don't think the thought occurred to them, because they didn't have any physical damage,” he said. “Or they thought this was only for businesses around Findlay Market. But it's for businesses in any neighborhood in the city, and all they need to do is show that they were economically affected by the riots.”

        The terms of the loan are generous. Businesses can borrow up to $50,000 for seven years at an interest rate of 1 percent. But there are no payments in the first year, and only interest in the second year.

        Already, 16 loans totaling $600,833 have been approved. But the city has cut checks for only four of them.

        Where's the remaining $413,833?

        The short answer is, it's caught up in red tape.

        Because the money ultimately comes from the federal taxpayer, the city is required to conduct an environmental impact study for each loan, said Peg Moertl, who was recently named as the director of the city's new Department of Neighborhood Development and Housing.

        Alicia B. Townsend, director of the Greater Cincinnati Microenterprise Initiative, which is administering the program, said the delays should be just two weeks ideally — and 30 days at worst.

        But some business owners have been waiting even longer.

        Kaldi's, a 9-year-old coffeehouse in Over-the-Rhine, had its best year ever in 2000. But sales are down 40 percent since April, and the owners haven't cashed their own paychecks in weeks, said co-owner Sonya McDonnell.

        She applied for a $50,000 loan in June, and was approved for $39,000 in November — but still hasn't seen the money.

        “Apparently it has to go to a number of different desks and be signed by a number of different people,” she said. “It's really been a slow process. And we really are at the point where we do need it.”

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