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The City of Berkeley Public Health Officer extended the stay-at-home Order through May 3 .The Order outlines what qualifies as an "essential business" (page 7-8), requires operating small businesses to institute social distancing practices (Appendix A) and addresses questions from Berkeley businesses in the FAQs, such as:
See the FAQs, with questions for businesses starting on page 13.
The U.S. Small Business Administration (SBA) offers local businesses and non-profits three main forms of financial assistance:
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Economic Injury Disaster Loan (EIDL): A newly-streamlined version of the SBA’s former disaster loan, EIDLs come with a $10,000 cash advance grant that can be used to pay for financial obligations and operating expenses incurred during the crisis, e.g. fixed expenses, rent, payroll, accounts payable. The loan itself carries a 3.75% interest rate for small businesses, or 2.75% for nonprofits. There are no fees or prepayment penalties, and the amount of the loan can be changed after submitting your application. Apply online directly through the SBA website.
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Paycheck Protection Program (PPP): Authorized by the federal “Coronavirus Aid, Relief, and Economic Security” (CARES) Act, the PPP offers $349 billion in forgivable loans for businesses and non-profits to pay up to 8 weeks of payroll costs, including benefits. 75% of the PPP loan must be used for payroll; the other 25% may cover mortgage interest, rent, or utilities. A sample application form can be found here. As loan funds are dispersed directly through participating banks and credit unions, reach out directly to your primary banking institution to ask about the PPP and/or options for payment relief or interest payment deferral. If you are unable to get assistance from your bank, or through the banks on SBA's lender matching page, please contact OED, as we have identified banks that are accepting new clients at this time.
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Debt Deferment or Relief: If you are an existing SBA borrower, you can defer payments on 7(a), 504 and microloans -- and payments on existing disaster loans will automatically be deferred through the end of this year. Talk to your SBA lender about SBA Debt Relief Programs.
The CARES Act also includes provisions for industry-specific lending, tax credits for retaining workers, payroll tax extensions, additional business tax deductions, deferred tax deadlines for the self-employed, expanded unemployment benefits, and other forms of individual relief and assistance. Check out the Small Business Owner’s Guide to the CARES Act on the U.S. Senate website to learn more.
State of CA Support for Small Businesses
All taxpayers who file a State of CA tax return less than $1 million dollars will now have until July 31, 2020 to file their return. If you qualify for this extension, it is automatic; you need not apply.
State of CA Small Business Relief Payment Plan: The State of CA will allow small businesses (those with less than $5 million in taxable annual sales) to defer payment of sales and use taxes through a 12-month, interest-free payment plan, up to $50,000. Payment plan requests will be available online soon: please visit the California Department of Tax & Fee Administration website to sign up to be notified when the system becomes available. Alternatively, you may contact their customer service center at 1-800-400-7115.
Additionally, the State of CA will offer a Disaster Relief Loan Guarantee Program through the California Infrastructure and Economic Development Bank (I-Bank) to mitigate barriers to capital for small businesses that may not qualify for federal funds (businesses in low-wealth and immigrant communities). Details are still being finalized with lending institutions; for now, see info about the programs and participating lenders on the I-Bank website.
Berkeley Relief Fund grants
The City of Berkeley has committed $3 million to emergency relief funds to help Berkeley’s low-income renters, arts organizations, and small businesses withstand the impacts of the COVID-19 pandemic.
Berkeley Business Continuity Grant applications were due by Monday (4/6) at 5pm and the City of Berkeley received 1,058 applications. City staff is now working to review and process these applications and to distribute payments as soon as possible.
Applications are still being accepted and considered:
- for Housing Retention Grants, up to $10,000, for low-income Berkeley residents who are unable to pay their rent or meet other basic needs due to the COVID-19 emergency; and
- on a rolling basis through April 20 at 5PM, for Arts Organization Continuity Grants up to $25,000, to help Berkeley-based nonprofit arts organizations grapple with the initial financial impacts of the COVID-19 pandemic.
Additional funding, made possible by charitable contributions from individuals and businesses to the Berkeley Relief Fund, will also be available to all grant applicants.
In order to protect commercial tenants during the pandemic, the State of California has authorized local governments to halt evictions in the midst of the coronavirus outbreak. On March 17, 2020, Berkeley City Council passed a COVID-19 Emergency Response Ordinance, which prohibits landlords or other entities from evicting tenants from commercial or residential property for delayed payment of rent due to specified reasons during the local State of Emergency, among other measures to address the impacts of coronavirus on the city's business and arts community. While the new law does not relieve tenants from liability for unpaid rent, which a landlord may seek after expiration of the local State of Emergency, a landlord may not charge or collect a late fee for rent that is delayed for the reasons stated above. The City will be developing guidelines for tenants to repay unpaid rent accrued during the course of the local State of Emergency.
See more City of Berkeley info for landlords and tenants here.
If you need to temporarily reduce your workforce at this time, consider California Work Sharing, a program where employers are spared the expense of recruiting, hiring, and training new employees and employees are spared the hardship of total unemployment.
See more about the program and how to apply here. If you need additional information on the Work Sharing Program, contact the EDD Special Claims Office at 916-464-3343.
If employees have lost their jobs or had their hours reduced for reasons related to COVID-19, they should apply for Unemployment Insurance through the State of California's Employment Development Department. Under the CARES Act “Pandemic Unemployment Assistance” clause, gig workers, independent contractors, and the self-employed are also eligible. File online before 10 pm on weekdays, before 8:30 pm on Saturdays, and 8 pm on Sundays or by calling 1-800-300-5616 between 8 am and Noon.
You can find additional resources for employers from the Alameda County Workforce Development Board, such as 50% reimbursement for training costs to upgrade the skills of current employees so they can help you make essential changes to operations due to COVID-19.
Other COVID-19 Business Resources
The City of Berkeley is partnering with the Berkeley Chamber to provide Berkeley businesses with timely and relevant information related to the COVID-19 pandemic. See the Berkeley Chamber’s COVID-19 Resources page for info including private sector relief grants, ways to contribute, tips for working from home, and free advising from the Alameda County Small Business Development Center.
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