Small businesses eager for financial aid to arrive
NEW YORK — When will the money arrive?
That’s the urgent question for small business owners who have been devastated by the coronavirus outbreak. They’re awaiting help from the $2 trillion rescue package signed into law Friday. But with bills coming due, no end to business closings and an economy that’s all but shut down, owners are worried about survival.
Millions of owners face April 1 due dates for rent, mortgage, credit card and other payments. Some have been granted leniency from landlords and lenders, but even then there are other business and personal bills that are owed.
And employees — at least those who haven’t been laid off — must be paid.
“How quick can we get these funds?” says Adam Rammel, co-owner of Brewfontaine, a bar and restaurant in Bellefontaine, Ohio, that’s now limited to takeout and delivery service. His revenue is down 60%, but he has eight staffers — down from 25 — whom he must pay.
“Relief can’t come soon enough — we’re a cash business with small margins,” says Rammel, who is looking to Small Business Administration loans. He needs the money despite receiving some concessions from his banker.
Freelancers and people whose gig work has vanished are also anxious about having to wait.
“I need to pay my electric bill and the mortgage,” says Krista Kowalcyzk, whose Florida photography business has come to a halt as weddings have been canceled and customers have decided against having portraits shot.
“I am terrified that not only do I have no revenue coming in, I have also been asked for thousands of dollars in refunds.”
At companies small and large, from restaurants and retailers to sports and entertainment venues, revenue has essentially dried up. The same for the businesses that support those companies. Even employers that are still operating have lost business.
The rescue package signed into law Friday provides for Small Business
Administration loans to companies as well as to sole proprietors and freelancers. The loans can be used for payroll, mortgages, rent and utilities, with those amounts forgiven and payments deferred.
It will also supply small loans that can, depending on an owner’s credit score, be approved quickly. Employers can receive tax credits for retaining workers, though not if they have obtained one of the SBA loans.
Many owners are also seeking separate SBA economic injury disaster loans. And the Federal Reserve plans to set up a program to lend directly to small business owners.
In addition, freelancers are now eligible for unemployment benefits. And owners can be eligible for the $1,200 per person payment that’s available to many Americans depending on their income.
The rescue aid appears to address some of the most vital needs of small businesses, notably the ability to maintain or hire back furloughed workers eventually.
The issue is whether it will come quickly enough.