This week, in the wake of the ongoing COVID-19 pandemic, the Downtown Alliance joined a group of business improvement districts and several local chambers of commerce in penning a letter to elected officials to outline a number of proposals to help keep doors open and independent operations alive.
Even with federal legislation aiming to create financial stabilization, hundreds of thousands of New Yorkers are still currently without work and the small-business community continues to struggle. The businesses, in addition to maintaining their overhead right now, are also trying to plan ahead so that they can keep workers on the payroll and/or rehire those who they had to temporarily lay off or furlough.
Addressed to Governor Cuomo and Mayor de Blasio, among other New York State and U.S. legislators, the letter posits “key policies to resuscitate ailing businesses and revamp the economy” and requests that the lawmakers “advocate for and implement these recommendations that will support the hundreds of thousands of small business owners and workers across New York City.”
The proposals fall into the following four buckets.
Business-interruption insurance claims should be required to be paid, or a specialized-business recovery fund should be established to promptly pay claims to businesses required to close (or limit) their operations, by government order. When necessary, the federal government must provide the insurance companies appropriate assistance.
Amending The Paycheck Protection Program (PPP)
The PPP loans from the CARES Act should be forgivable if businesses rehire needed staff at a minimum of six months after they fully reopen. (The current legislation has the rehire deadline set at June 30.) Loans should be forgiven so that funds can be used for rent or other expenses. The stimulus payout should be extended so that businesses that need funding can still apply.
Also, all participating banks should be required to accept, review and qualify applications from any small business without requiring existing accounts or loans.
Keeping the city’s and state’s budgetary constraints in mind, investigate the fiscal implications of converting restaurants, nightlife establishments and retail stores’ sales tax collection into grants. These small businesses need an injection of cash to help them survive. Since these funds are on hand, converting (and/or reverting) the sales tax collection into a grant, will help small businesses immediately with needed cash flow, and will stimulate economic activity.
Rent And Mortgages
The majority of businesses in New York City have been mandated by the government to close (or limit their operations) and many therefore cannot pay their rent. Property owners have financial obligations including property taxes, mortgages, maintenance and capital improvements — much of which is paid for by their commercial tenants. To help both parties weather this crisis, a government backstop should be provided. These government programs could include direct federal financial assistance, rent and mortgage forbearance and/or a property tax deduction for landlords who provide rent concessions to their tenants.
You can read the letter in full here.