Small Businesses and Their Employees Are At Risk! Tell Congress to Save Our Economy Now!
Small businesses are on the line and the decisions we make now could make or break our economy. The CARES Act was intended as a down payment to help small businesses survive, but even that down payment isn’t getting to where it’s needed fast enough. It is time for Congress to step up.
In order to reopen our businesses, we must have a healthcare strategy that includes comprehensive testing and other necessary medical protocols to assure that we can safely restart our economy. Instead of arbitrary deadlines, our government must develop this strategy NOW!
The health care strategy must be matched with an economic strategy, which the American Sustainable Business Council, the American Independent Business Alliance (AMIBA) and other business organizations have developed. “The Next Steps to Keep American Business Alive” are crucial to helping small and mid-sized local and independent businesses (including farms and fishers) across the United States survive the pandemic until they are able to safely reopen.
We are adding a comprehensive health care strategy to our economic call and placing the demand for that health strategy at the top of this list because our ultimate goal is to permit our businesses to reopen as soon as it is safely possible. That can’t happen without testing and the other health protocols necessary to make us as safe as possible, as well as restore the confidence of our employees and our customers.
During this epic economic and health crisis, people of color and low-income individuals are now suffering at significantly higher rates, both in daily economic life and in healthcare. These individuals often serve at the front lines, as service, delivery, and gig employees. We also need to support the most vulnerable businesses including Black, Brown, women-owned and other-small business owners, as they require the government’s financial aid now more than ever.
We have also modified our PPP demand to include language from the Independent Restaurant Coalition; the National Family Farm Coalition; Northwest Atlantic Marine Alliance; Farm Aid; Why Hunger; Institute for Agriculture and Trade Policy; and Heal Food Alliance with demands that will help all closed businesses.
Join us in sending these seven demands to all 535 members of Congress and the President and Vice President.
1. Implement a comprehensive healthcare strategy IMMEDIATELY that includes widespread testing along with other necessary medical protocols so that businesses can re-open safely and as soon as possible.
2. Fund the SBA Economic Injury Disaster Loan (EIDL) Advance NOW!
The SBA created a $10,000 EIDL Loan Advance program that provides much needed economic support for small businesses. The promise was made to have the cash deposited within four days from when the online application was received. Even though online applications were sent ten days ago, as of April 8th, a tiny number of small businesses, if any, have received this important form of emergency cash.
- Demand the SBA do what is needed to fund these applications immediately!
- Reassign IRS workers not processing returns and refunds (since tax day has been pushed back) to assist SBA in processing EIDL payments to expedite payments.
- Add a provision to make gig workers and self-employed eligible for EIDL LOAN advance program.
3. Implement the New Unemployment Benefits NOW!
The CARES Act approved significant changes via its unemployment insurance program, but they have not been implemented or explained to unemployment claimants.
- The percentage of a paycheck has not increased from 50% to 100%.
- The $600 increase in maximum pay has not been implemented.
- Direct every state Department of Unemployment Assistance to implement the new policies immediately.
- Task Department of Labor with creating an online training program and a broad publicity program for all state UI offices.
- Develop a program to incentivize expedited state UI payments and increase funding to state and local governments by at least $150 billion.
4. Increase the CARES Act Payroll Protection Program (PPP) by at least $250 billion, change the forgiveness requirements, and provide support for new and smaller businesses in applying NOW!
The intention of the PPP was excellent. However, because of the necessary rush to approve this program, the implementation of the PPP has woefully inadequate.
- It became clear within a few days that $350 billion could not meet the vast needs of small businesses. Increasing this fund by at least $250 billion is the next logical step!
- From the beginning, the loan forgiveness requirements have been confusing and do not help most small businesses. The current requirements state that in order for a PPP loan to be forgiven, 75% of the loan must be spent on payroll within eight weeks after the funds are released. This puts a small business owner whose business is currently closed because of the coronavirus crisis in the awkward position of either asking their employees to come back to work before the business is open or paying people for not coming to work. This policy needs to be changed NOW!
- In most cases, the small banks are doing a superior job in supporting their small businesses. But in general, the large banks have not made it easy for anyone except established businesses to understand and navigate the application process.
- The deadlines on the PPP are unrealistic and must be changed.
- Increase the PPP fund by at least $250 billion.
- Change the PPP loan forgiveness requirements to, “A business can have the PPP loan forgiven when they legally can re-open for business and they have a payroll of at least 75% of the pre-crisis payroll and that up to 75% of the loan funds can be spent after the business opens.”
- Create well-publicized programs that support new and smaller businesses in accessing the funds from the PPP for their business and staff.
- Peg the origination date of a PPP loan to the first day that a business loan recipient can legally open fully in any given entity.
- Extend the maximum loan amounts to 3 months after we are allowed to reopen and operate at full capacity.
5. Provide relief for 1099 contractors, the self-employed and gig workers NOW!
The PPP and unemployment insurance are ideal opportunities to offer relief for 1099 contractors, the self-employed, and gig workers, many of whom have had limited access to credit and financial resources. Current policies put these workers at the back of the line in accessing help from a program where funding is available on a first-come-first-served basis.
- Expand the funding by at least $250 billion
- Prioritize those who have been left out, specifically 1099 contractors, the self-employed and gig workers
- Gig workers and 1099 self-employed:
- Section 2102 of the CARES Act establishes supplementary unemployment insurance through a Pandemic Unemployment Assistance (PUA) program. PUA makes unemployment insurance available exclusively to individuals who find themselves unable to work due to COVID-19 and ineligible to receive ordinary unemployment benefits under state or federal programs.
- Require the Department of Labor to create an online training program for State Unemployment agencies to understand and implement the PUA program and to create a program to broadly publicize this program to the self-employed and gig workers through mass media and online.
- Add at least $100 million targeted specifically to PUA.
6. People of color, immigrants, and low-income communities and business owners are experiencing major challenges with the stimulus program.
These business owners don’t have traditional banking relationships, a major requirement of accessing the funds. Many of the entities they use include community banks, credit unions, micro lenders, and check cashing companies, which are not eligible to administer the funds.
- Expand the range and type of lenders/providers to include community banks, credit unions, Community Development Finance Corporations and micro lenders.
- Provide adequate funding for outreach and education to assist these groups in applying for unemployment insurance, PPP and EDIL and other economic stimulus programs.
- Use same set asides used for other federal contract award programs for minority and women owned businesses in providing assistance through the CARES Act and any other coronavirus relief programs.
7. Action is necessary to ensure the resilience of the small-scale and mid-sized farmers, fishers, and ranchers.
As local restaurants and other direct purchasers of products small-scale and mid-sized farmers, fishers, and ranchers struggle to stay open, so do the producers they rely upon. We applaud the assistance that was given to agriculture and the fishing industry in the last stimulus package. However, it is likely the majority of small and medium-scale food producers will see little of this relief if the USDA and NOAA are left to control how the funds are distributed without a reformed system of fund allocation.
- More equitable distribution of direct payments by USDA and NOAA , with particular attention to family-scale operations, limited resource producers, farms operated by farmers of color, and tribal nations
- Expansion of the Local Agriculture Market Program
- Debt forgiveness for small-scale producers
- Expanded access to zero-percent interest operating loans so that producers who have lost access to markets can bridge the gap until those markets reopen.