Small businesses wrestling with the details of the federal Paycheck Protection Program know one key condition: To get maximum loan forgiveness, 75% of the loan amount must go toward payroll.But experts have suggested another possible route toward greater forgiveness as the Small Business Administration still finalizes its guidance around loan terms — by offering bonuses to employees.
Under the PPP, small-business loans were calculated based on payroll costs for 2.5 months and then allowing for 25% of the loan amount to flow toward nonpayroll expenses such as rent, utilities, mortgage payments and interest on debt. But many businesses are just not structured with those cost ratios, raising concerns that a portion of PPP loans might remain unforgiven, said Matthew Dwyer, principal at accounting and advisory firm Matthews, Carter & Boyce, based in Fairfax, Virginia.
“As a result, companies may find it challenging to meet the requirement to use 75% of the loan proceeds on payroll costs,” Dwyer said. “These concerns will be mitigated, and loans likely will be forgiven in full, if additional SBA guidance allows bonuses or increases in pay to workers to be included in the forgiveness calculation, or if SBA allows the same for prepayment of rent or utilities."
"It’s never to early to begin planning for re-opening! Our team has built what I believe is a very strong phased approach towards responsibly re-opening our venues in what is sure to be a challenging environment. I wanted to make this plan public in the event that it is useful to some, as well as to collaborate with others who may have their own plans. We are stronger together!" - Mitchell Roberts CEO of EVO
A few key points of advice to those looking to establish their own plans:
1.) Expect and prepare for heavy lead times and unexpected costs. Operating in the upcoming “new normal” will almost certainly require equipment that you most likely do not have. (Masks, Touchless Thermometers, Sneeze Guards, etc.) These items are currently seeing 2-3 week lead items. Get ahead of that.
2.) Don’t forget your team members. I’ve seen a lot of great guest-focused precautions, but don’t forget to take care of your staff too, as they are the ones on our front lines.
3.) Last but not at all least, weigh the impact of public perception. As important as it is that our guests ARE safe, it’s equally important that they FEEL safe. Public Perception will be the fuel that ignites our return to normalcy.
Here are some of the steps they will be taking in EVO restaurants
- reducing table capacity to 50%
- limiting groups to no more than 4
- removing bar stools from the bar
- using disposable paper menus
- sanitizer on every table
- masks required unless eating
- mask & nitrile gloves required for servers
Currently exploring mobile ordering as well.
Texas Gov. Greg Abbott’s “retail-to-go” phase of reopening the state’s economy starts Friday. But your favorite store may not be ready, and don’t expect to stroll into the mall.
A week’s notice may not be enough for some, from individual shop owners worried about new world protocols to store managers who must get payment systems turned back on and clearance from corporate offices outside Texas that are preoccupied with bigger issues.
And small shop owners said they haven’t received funds from federal loans yet to pay the employees they need to offer retail to go.
The COVID-19 pandemic has taken an especially hard toll on small retailers, which tend to have limited access to capital and minimal cash reserves. A March 30th survey by the National Federation of Independent Business found that the COVID-19 pandemic has negatively impacted 92 percent of small employers. About half the employers who participated in the survey can survive for no more than two months under current conditions.
Shopping center owners aren’t standing idly by in the face of this existential threat, and it’s not hard to understand why. Nearly 70 percent of shopping center tenants are small businesses that employ fewer than 10 people, according to ICSC. These small businesses play an outsize role in many shopping centers by helping distinguish one property from the next. “Small businesses are the heart and soul of our properties. They build long-lasting emotional connections with communities,” said Trademark Property Co. CEO Terry Montesi.
Many shopping center landlords are providing small-business tenants with some type of short-term rent relief, typically on a case-by-case basis, while steering them to resources designed to help them weather the economic storm and prepare for what’s expected to be a gradual return to normalcy.
SAN ANTONIO — The United Way of San Antonio and Bexar County announced it received a $100,000 grant to help provide childcare assistance to essential workers.
The grant money is provided by Truist Financial Corporation.
Essential workers who are in need of childcare assistance must apply to the program and meet certain criteria. A link to the online application can be found here.
On March 27, when both branches of Congress and the White House came to an agreement to provide sweeping financial assistance via the $2.2 trillion CARES Act, many of us in the restaurant industry cheered with a big sigh of relief. This pandemic, and the consequential shut-down of an entire industry that relies upon the gathering of people - at a moment when people cannot gather- had already shown that no restaurant is unsinkable. With slim margins in our industry to begin with, restaurants of all sizes and flavors were vulnerable and laying off people by the hundreds. Indeed, both Shake Shack and Union Square Hospitality Group needed to make those tough decisions too, furloughing or laying off hundreds of team members throughout our respective companies—one a publicly traded company, the other an independent restaurant group.
Restaurants function as the lifeblood of the U.S. economy and the nation's spirit. The bulk of the over $800 billion that restaurant-goers spend on dining out flows right back into the economy with much of that impact going to the very small businesses this PPP loan was intended to reach. The CARES Act was touted as the largest economic stimulus package in U.S. history and on its initial face, for restaurants, there seemed to be a lot to like in the bill.
With the country facing a prospective permanent loss of restaurants up and down the food chain, the bill arrived just in the nick of time. The onus was placed on each business to figure out how, when, or even if to apply. The “PPP” came with no user manual and it was extremely confusing. Both Shake Shack (a company with 189 restaurants in the U.S., employing nearly 8,000 team members) and Union Square Hospitality Group (with over 2,000 employees) arrived at a similar conclusion. The best chance of keeping our teams working, off the unemployment line and hiring back our furloughed and laid off employees, would be to apply now and hope things would be clarified in time.
The PPP funds are exhausted. Time for Plan B. National Small Business Town Hall #4
Learn from the expert panelists about where the CARES Act is at as of 4/17 and hear answers to small business owner's burning questions including: Where to go from here? How to use the funds? Explaining the fine print?
Texas leads the country with the most approvals for the U.S. Small Business Administration’s Paycheck Protection Program as of April 13, according to SBA data obtained by the Texas Bankers Association.
Texas has approved 88,434 loans totaling $21.77 billion, as of April 13.
California followed behind Texas, having approved 54,922 PPP applications totaling $20.85 billion in loans, as of April 13. Florida ranked third, having approved 52,021 loans totaling $12.65 billion.
Overall, the average loan size is about $239,152, according to the data.
March 26, 2020 — DENTON — Women-owned small businesses in Texas suffering financial losses associated with the coronavirus pandemic were thrown a lifeline today after the Center for Women Entrepreneurs at Texas Woman’s University announced a million-dollar grant program to help get them back on their feet.
Texas Woman’s University Chancellor Carine M. Feyten announced that the Center for Women Entrepreneurs is launching the AssistHER grant program, which will provide 100 $10,000 grants to women-owned small businesses in Texas that have been impacted adversely by the coronavirus pandemic. Grant funds can be used for operating expenses (excluding payment of sales tax and payroll, advertising, purchase of food for consumption, penalties and fees, and charitable donations), technology upgrades or help adapting to a new business model.
To be eligible for the grants, businesses must be at least 51% owned by a woman, have a demonstrated need due directly to COVID-19, and be owned and operated in Texas. Awardees will be required to complete online training on how to maintain business operations in the current environment and report all expenditures of grant funds. Eligible businesses must be up to date on payroll, sales and other taxes and be properly permitted.
APRIL 15, 2020 — The UTSA Institute for Economic Development today launched the Small Business Development Center COVID-19 Business Recovery Accelerator (SBDC COBRA) to help small businesses weather the financial hardships caused by the coronavirus pandemic. COBRA is the only recovery accelerator of its kind in Texas to help stabilize and rebuild the small-business economy.
COBRA will provide small businesses with the counseling and resources to pursue loans from the financial industry and to begin recovering from the economic impact of the COVID-19 pandemic. The accelerator will serve businesses in Bexar County and 10 surrounding counties. It will be funded by a $1.2 million grant from the U.S. Small Business Administration.
“For nearly 40 years UTSA’s economic development programs have been creating jobs, growing businesses and strengthening the economy,” said UTSA President Taylor Eighmy. “UTSA is committed to leveraging its knowledge enterprise to support the community in this time of need. I can think of no better way to do that than to pave the way for small businesses to get emergency financial relief.”
Jenna Saucedo-Herrera, president and CEO of the San Antonio Economic Development Foundation, answers your questions on KSAT.
San Antonio is considered to be most prepared for a recession, according to a recent study by Moody’s Investor Service reported by Yahoo News.
Moody’s looked at the largest 25 U.S. cities and used four main factors to determine how prepared a city was for recession -- Fiscal volatility, reserve coverage, financial flexibility and pension risk.
San Antonio’s bond ratings are among the highest of any major city in the United States.
Austin, Boston, Charlotte, Denver, San Francisco, and Seattle are also best positioned to weather a recession, the study found.
Chicago and Detroit are considered the least prepared. Both cities have credit ratings that fall under the non-investment grade category, which is the lowest rating.
AUSTIN — From Texas Governor's Office - Governor Greg Abbott today announced that Goldman Sachs and the LiftFund, along with other community development financial institutions (CDFIs), are partnering to provide $50 million in loans to small businesses in Texas that have been affected by COVID-19 as part of the Goldman Sachs 10,000 Small Businesses program. These loans, made through the U.S. Small Business Administration’s (SBA) Paycheck Protection Program (PPP), will primarily be used for payroll so that employees can continue to receive paychecks and small businesses can retain their employees and will be partially or wholly forgiven.
"Small businesses and their employees are at the heart of the Texas economy, and they need support during these difficult times,” said Governor Abbott. “These loans will help us revitalize our economy and restore Texans’ livelihoods as we respond to COVID-19. I thank Goldman Sachs and the LiftFund for providing this lifeline to Texas small businesses and their employees by providing them with the support they need to overcome the challenges posed by COVID-19. This partnership is an important first step in our journey to economic recovery in the state of Texas."
"We have seen first-hand the determination and resilience of small business owners in Texas, having worked alongside them for years through our 10,000 Small Businesses program," said John Waldron, President and Chief Operating Officer of Goldman Sachs. "Goldman Sachs understands that our communities and economy rely on small business and we are doing everything we can to support this vital engine of economic growth and employment."
Find creative ways to adjust in a time of crisis.
Here are seven entrepreneurs who are innovating and reinventing their businesses during the coronavirus pandemic.
Governor’s Small Business Series Webinar to be held 1:00pm - 2:00pm on Wednesday, April 15, 2020. Participation in the Webinar is FREE. The Governor’s Small Business Series Webinars provide Texas small business owners and entrepreneurs with timely, relevant, actionable information on the COVID-19 recovery resources such as Paycheck Protection Program, EIDL Loan Advance, SBA Express Bridge Loans, and SBA Debt Relief. Businesses will also get the chance to connect with local experts and support systems. Click here to Register
Knight Talks: Town Hall with Roy and Crenshaw Thursday, April 16 8:00 p.m.
Many of the questions we're hearing in Texas are related to the Paycheck Protection Program (PPP), when to anticipate more help from the government, options for taking care of employees, and business interruption insurance. Join us for a virtual town hall meeting with Dr. Emily Williams Knight, President & CEO of the Texas Restaurant Association; Representative Dan Crenshaw (TX District 2); and Representative Chip Roy (TX District 21). Click here to Register
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