Coronavirus Economic Relief for Small Businesses and Nonprofits
“In a time of domestic crisis, men of goodwill and generosity should be able to unite regardless of party or politics.”
—John F. Kennedy
Amidst the pandemonium created by the Coronavirus outbreak, our partisan US Congress has managed to overwhelmingly support and pass several pieces of stimulus legislation. The process was neither easy nor smooth, but these mega-bills include stimulus for individuals, businesses, healthcare providers, and the greater fiscal system and economy.
Small businesses, in particular those with under 500 employees, can avail of federally funded relief to provide paid sick leave and take out guaranteed forgivable loans to continue operations and pay employees. Many nonprofits, sole proprietors, and independent contractors can get help, too.
The Families First Coronavirus Response Act (FFCRA) took effect on April 1, 2020 and has two primary provisions for paid employee leave. The employer pays the leave and then gets a tax credit on a dollar-for-dollar basis. There are up to eighty hours of Emergency Paid Sick Leave (EPSL) available for covered employees for six reasons, including Alaska’s travel mandate and Anchorage’s Hunker Down order. Other payment triggers include an employee experiencing symptoms of COVID-19 while seeking a diagnosis. In those examples, payment is 100 percent of the employee’s regular rate of pay up to $511 per day.
EPSL is also available when caring for others that are subject to an isolation order or have been advised by a health care provider to self-quarantine. School and childcare facility closures can be a burden for parents, and those events also trigger an EPSL payment. When caring for others, the benefit is two-thirds of the regular rate of pay up to $200 per day. When EPSL is triggered for caring for one’s own child whose school or place of childcare has closed, an Emergency Family Medical Leave Act (EFMLA) period is available for twelve weeks. EFMLA provides up to an additional ten weeks of paid leave at two-thirds the rate of regular pay, up to $200 per day, upon expiration of the EPSL benefit. Job protection is offered unless exemptions apply.
Current Issue
April 2024
While FFCRA is incredibly helpful for employers and employees alike, the Coronavirus Aid, Relief, and Economic Security Act (CARES) is an even more mammoth form of federal cash infusion. The CARES Act’s $2.3 trillion injection into the economy is the largest stimulus and economic relief package in US history. The key provisions for employers with under 500 employees are the 100 percent federally guaranteed loans under the Payroll Protection Program (PPP) and the Economic Injury Disaster Loans & Emergency Economic Injury Grants (EIDL).
Under the PPP, cash flow assistance is provided to employers who maintain their payroll during the presumed worst of the viral outbreak. The PPP will forgive portions of the loan used for up to eight weeks of payroll expenses, including continuation of group healthcare and retirement benefits. The loan amount is generally the greater of 250 percent of an organization’s monthly payroll costs or $10 million. SBA 7(a) lenders are eligible to assist interested applicants. There was about $350 billion appropriated for the PPP, and applications will be available to be taken very early in April. The PPP loans are first come, first serve.
The EIDL program can provide desperately needed cash for continuity of a business or nonprofit. The first $10,000 is an emergency advance made within three days of applying through the Small Business Administration. This advance does not need to be repaid. Otherwise, the EIDLs are low interest loans of up to $2 million with principal and interest deferment periods that vary. Funds can be used on additional payroll and operating expenses.
Congress moved relatively quickly to approve emergency paid leave and funding for small businesses and many nonprofit organizations. Take advantage of free resources at https://risqconsulting.com/covid-19-resources/ including articles, posters, and webinars.
In their company kitchens, the Corporate 100 blend wholesome ingredients with exquisite utensils to create the scrumptious ambrosia that keeps employees gratified and contented. Meet the top Alaska employers ranked by number of Alaskans on their payroll, and learn the recipe for success. This issue also includes a focus on economic development initiatives in Anchorage and Kodiak.