Hello and welcome to what in California is Week Two of “Stay at Home.”
I’m keeping small businesses and the self-employed up-to-date with news and info. on pending legislation, financing resources, and analysis and advice with a daily email, and each Monday-Friday I’ll also hold a Facebook Live at 1pm EDT/ 10am Pacific at www.facebook.com/RhondaAbramsSmallBusiness.
First, I want to urge you to communicate TODAY with your Senators and Congressperson urging direct assistance to small businesses. As of this writing, the big “Phase Three” stimulus—which could be as much as $1 trillion—and what it includes (or leaves out) may have a direct impact on whether your business will be able to survive.
Here’s where things stand as of 11pm Sunday night:
- The Republican Senate bill for the big stimulus package did not pass. Democrats had many serious issues with this bill, which is widely seen to be heavily tilted toward Wall Street rather than Main Street or workers.
From a small business standpoint, here’s what is problematic/missing from the Senate Republican bill:
- The funds for small businesses would be LOANS, not GRANTS.
- According to reports in the New York Times, those loans would only be available to those small businesses that “keep their payrolls steady through the crisis,” meaning those businesses, such as restaurants, that have already laid off workers would not be eligible.
- Some small business loans would be forgiven if employers paid their workers throughout the crisis.
- Speaker of the House Nancy Pelosi is preparing a different version of the stimulus that promises to have more direct aid to small businesses. I don’t know the specifics of that legislation, but I’m hoping that it is built along the lines of the “Save America’s Main Street Act” proposed by Senators Ben Cardin and Ron Wyden. In that proposal, small businesses would get a direct GRANT—not loan—of up to $75,000, equal to 30% of gross receipts of the prior year if qualified: “$1 million or less in gross receipts and 50 or less employees.”
Analysis: The Republican bill definitely does not provide sufficient help for small businesses. Small businesses need more than loans. Many, if not most, small business owners are unsure what the economy—and their market—will look like after this crisis. Asking them to take out loans is not enough—when they don’t know if they’ll even have a business and most loans require personal guarantees. Small businesses need cash GRANTS.
Moreover, it appears that in this bill, the requirements on small businesses are actually HARSHER THAN ON BIG CORPORATIONS. Small businesses must guarantee they’ll keep employees on the payroll to qualify while big corporations are not being held to the same commitment (which is one of the Democrats’ sticking points).
Small businesses are closing every day of this crisis—and they employ over half of all workers. If we want our economy to recover, small businesses need help and they need help fast.
CONTACT YOUR SENATOR AND REPRESENTATIVE TODAY AND URGE THEM TO INCLUDE CASH GRANTS TO SMALL BUSINESSES – AND FAST.
Wishing you well – from Rhonda and the PlanningShop team
Copyright Rhonda Abrams, 2020
