Mandated closures, event cancellations and customers staying home to practice social distancing have made it harder for businesses to stay in business during the COVID-19 outbreak.
But city, state and federal agencies are offering loans, assistance and other relief programs designed to help with ongoing costs or investments necessary to survive the current crisis.
To help businesses identify the right program for their needs, the city’s economic development department has set up an emergency business call center, which can be reached at (562) 570-4BIZ (4249). The Business Hotline and Call Center hours are 8 a.m. – 5 p.m. (Monday – Sunday). City staff will respond to voicemails made after business hours within 24 hours, according to the city’s COVID-19 Business Support website.
Here’s a list of the different programs available to Long Beach businesses affected by the coronavirus crisis:
Work Long Beach
A collaboration between Pacific Gateway and other providers and public agencies in Long Beach, the Work Long Beach program was set up to support the hourly labor market in the city.
The program is designed to create an online exchange, currently focused on childcare, where those seeking additional work and those in need of workers can connect. Both employees and employers can sign up for Work Long Beach here.
Loan Programs
Paycheck Protection Program
What is it? This SBA loan is designed to provide a direct incentive for small businesses to keep their workers on the payroll. SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.
What does it offer? This loan has a maturity of 2 years and an interest rate of .5%.
How much can businesses borrow? Loans can be for up to two months of your average monthly payroll costs from the last year, plus 25%. $10 million cap. Payroll costs will be capped at $100,000 annualized for each employee.
More info: https://home.treasury.gov/system/files/136/PPP–Fact-Sheet.pdf
Note: Given the high demand for the federal Paycheck Protection Program, the city of Long Beach, together with the National Development Council, has created a program to help businesses navigate the application process. Businesses can now submit their application through a portal created by the council.
SBA Economic Injury Disaster Loan
What is it? The Small Business Administration is offering federal disaster loans for working capital to California small businesses suffering substantial economic injury as a result of the Coronavirus (COVID-19).
What does it offer? The interest rate is 3.75 percent for small businesses. The interest rate for private non-profit organizations is 2.75 percent. The program also offers a $10,000 advance that does not need to be paid back.
How much can businesses borrow? Up to $2 million.
More info: https://laedc.org/coronavirus/
Kiva Loan Program
What is it? A partnership between the city of Long Beach and the Los Angeles Local Initiatives Support Corporation that offers crowdfunded loans.
What does it offer? 0% interest with up to 36 month repayment period
How much can businesses borrow? $500 to $10,000.
More info: https://us.kiva.org/longbeach/
Microenterprise Loan Program
What is it? A city-run loan program for startups and existing small businesses with five or less employees, to fund finance equipment, fixtures, furniture and working capital.
What does it offer? Fixed rate: prime rate plus 1.5%, 2% fee if loan is approved.
How much can businesses borrow? Loans start at $25,000, borrower must create one full-time job for every $35,000 borrowed.
More info: Contact Seyed Jalali, Economic Development Officer, at Seyed.Jalali@longbeach.gov.
Grow Long Beach Fund
What is it? A partnership between the City of Long Beach and National Development Council Grow America Fund to provide funding to for-profit entities that have been operating in Long Beach for at least two years.
What does it offer? Fixed rate: based on current prime rate, for a term of 3 – 25 years.
How much can businesses borrow? $100,000 to $2 million.
More info: Contact Seyed Jalali, Economic Development Officer, at Seyed.Jalali@longbeach.gov.
Disaster Relief Loan Guarantee Program
What is it? The Small Business Finance Center (SBFC) partners with Financial Development Corporations to provide loan guarantees and direct loans for small businesses and nonprofits that experience capital access barriers.
What does it offer? Guarantees of up to 80% – 95% of loan, guaranteed up to 7 years, term can be longer. Loan interest rates negotiated between lender and borrower.
How much can businesses borrow? Loans up to $20 million, maximal guarantees of $1 million.
More info: https://www.ibank.ca.gov/publications/fdc/
Jump Start Loan Program
What is it? Jump Start provides microloans, technical assistance and financial literacy training to low-wealth entrepreneurs in low-income, high-unemployment communities or those declared as disaster and emergency areas.
What does it offer? Term up to 5-years, fully amortized
How much can businesses borrow? $500 to $10,000.
More info: https://www.ibank.ca.gov/small-business-finance-center/
California Capital Access Program for Small Business
What is it? The program encourages banks and other financial institutions to make loans to small businesses that have difficulty obtaining financing.
What does it offer? If you own a small business, you may receive more favorable loan terms from a lender if your loan is enrolled in the CalCAP Loan Loss Reserve Program, which may provide up to 100% coverage on losses as a result of certain loan defaults. A lender may be more comfortable underwriting small business loans.
How much can businesses borrow? Up to $5 million.
More info: To find a participating lender, visit https://www.treasurer.ca.gov/cpcfa/calcap/sb/index.asp
Utility/Fee Assistance
Gas and Water: The Long Beach Water and Energy departments have temporarily suspended water and gas shutoffs. According to the departments, businesses and residents experiencing financial hardship during this public health crisis may be eligible to establish a payment plan to pay gas or water bills. For more information call 562-570-5700.
The city will be suspending penalties and interest for late payments for utilities and parking citations, for business license fees and library fines incurred between March 15 and at least through the end of March, “to aid residents and businesses financially during the difficult time.”
The city also will be returning city park and other prepaid fees for canceled activities and events at city facilities.
Tax Relief/Assistance
On March 30, Gov. Gavin Newsom signed an executive order, allowing the California Department of Tax and Fee Administration (CDTFA) to offer a 90-day extension for tax returns and tax payments for all businesses filing a return for less than $1 million in taxes. As a result, small businesses will have until the end of July to file their first-quarter returns.
Additionally, the order extends the statute of limitations to file a claim for refund by 60 days to accommodate tax and fee payers.
Taxpayers can request assistance by contacting the department, some services are also available online. The department’s customer service center can be reached at 800-400-7115.
“During this public health emergency, every Californian should be free to focus on their health and wellbeing,” State Controller Betty T. Yee, who serves as chair of the Franchise Tax Board, said in a press release. “Having extra time to file their taxes helps allows people to do this, as the experts work to control the spread of coronavirus.”
This relief includes moving the various tax filing and payment deadlines:
Partnerships and LLCs who are taxed as partnerships whose tax returns are due on March 15 now have a 90-day extension to file and pay by June 15.
Individual filers whose tax returns are due on April 15 now have a 60-day extension to file and pay by June 15.
Quarterly estimated tax payments due on April 15 now have a 60-day extension to pay by June 15.
The board’s June 15 extended due date may be pushed back even further if a longer relief period is granted by the Internal Revenue Service.
Per instructions by the Franchise Tax Board, taxpayers claiming the special COVID-19 relief should write the name of the state of emergency, COVID-19, in black ink at the top of the tax return to highlight the special extension period. Those who are e-filing, should follow the software instructions to enter disaster information.
The FTB will also waive interest and any late filing or late payment penalties that would otherwise apply, according to a recent release.
How businesses can support employees
Workforce Development Hotline
Employers can contact the following city’s workforce development hotline at (562) 570-3702 for direct assistance from an on-site business engagement representative.
Business engagement representatives can help employers access the following resources:
Assistance for Impacted Workers:
Helps impacted workers understand their Unemployment Insurance benefits and access other state resources. Impacted workers can receive access to a training scholarship and individualized recruitment support.
Work Sharing:
The state’s Work Sharing program is an alternative to layoffs to help employers handle temporary slowdowns. It allows staff to receive a portion of their Unemployment Insurance benefits when their hours are reduced. Employers keep all staff, just reduce all their hours proportionately instead of keeping some at 100% while laying off others.
Paid Family Leave:
Workers may apply for Paid Family Leave if they need to take care of a family member who has COVID-19.
Unemployment Insurance:
Those who have to miss work to care for children during school closures, because they have no other care options and cannot work their regular hours remotely, may be eligible for Unemployment Insurance benefits. Applications for unemployment insurance should be submitted to the California Employment Development Department. The federal CARES Act provides $600 per week in unemployment benefits to workers who have been unable to work due to the coronavirus pandemic between March 29, 2020 to July 25, 2020.
Disability Insurance:
Employees who are unable to work due after having or being exposed to COVID-19, as certified by a medical professional, can file a Disability Insurance (DI) claim. DI provides short-term benefit payments to eligible workers who have a full or partial loss of wages due to a non-work-related illness, injury, or pregnancy. Benefit amounts are approximately 60-70 percent of wages (depending on income) and range from $50-$1,300 a week. The Governor’s March 12 executive order waives the one-week unpaid waiting period, meaning workers can receive benefits starting with the first week they are out of work.
Rapid Response Program:
Employers planning a closure or major layoffs as a result of the coronavirus can get help through the Rapid Response program. Rapid Response teams meet with affected businesses to discuss their needs, help avert potential layoffs, and provide immediate on-site services to assist workers facing job losses. Long Beach businesses can contact Long Beach/Signal Hill WorkPlace at 562-570-3700 for more information.
Additional resources for small businesses, nonprofits and the self-employed
Self-employed workers
May qualify for insurance benefits if they or an employer have made contributions to an insurance program, such as disability or unemployment insurance, in the past five to 18 months.
Contributions can stem from a prior job, and some workers may be able to claim that they have been previously misclassified as an independent contractor instead of an employee, in order to receive certain benefits.
The Employment Development Department began taking applications for the Pandemic Unemployment Assistance program for self-employed workers on April 28. Visit the department’s website to learn more.
Small Businesses
Additional resources for small businesses are available through the Office of the Small Business Advocate, which is represented through a designated local center in Long Beach. Find more details and contact information by visiting the L.A. Small Business Development Lead Center’s website.
The Small Business Development Center is providing free virtual business consultations and is assisting small businesses with disaster preparedness and recovery. Business consultants are available to help answer questions regarding supply chain disruption and liability, technology plans for setting up remote work stations for employees, concerns about cashflow during disruption and concerns about credit and finance issues. Businesses interested in a free consultation can contact the Long Beach SBDC at 562-938-5100 or visit https://longbeachsbdc.org/.
Nonprofits
Long Beach Community Foundation, in partnership with the City of Long Beach, has created a disaster relief fund designed to help nonprofits survive the current crisis. The fund will support community-based organizations at the frontlines of the coronavirus response in the Long Beach area. Grants will be made to support approved 501(C)3 nonprofit, educational, and governmental organizations working on these efforts.
Finding alternative business opportunities
The Incumbent Worker Training program is a cost sharing program, designed to help fund the training of existing employees, as businesses seek opportunities in new markets and instituting new processes that require retraining.