Treasury Secretary Steven Mnuchin estimates that the small-business relief included in the massive Coronavirus Aid, Relief and Economic Security Act could keep 50% of Americans at work. A key piece of the $2 trillion stimulus bill passed by Congress and signed into law in March by President Donald Trump was more than $349 billion in funding for small businesses.
The U.S. Small Business Administration will be overseeing the distribution of those funds through local banks, as well as other assistance programs. To accomplish the goal of helping small businesses keep their staffs employed will be the efforts of the SBA’s partners, including the Small Business Development Center at California State University, Bakersfield.
The largest stimulus package in U.S. history was passed as the ongoing coronavirus pandemic forced millions of Americans to stay home and required restaurants, bars, entertainment venues and other “nonessential” businesses to close their doors. Unemployment rates have skyrocketed, as businesses have laid off workers.
“This is not the fault of the American public,” Mnuchin said, explaining the intent of writing checks to individuals and families as part of the stimulus bill is “to get all those people paid.”
Loans and loan forgiveness programs written into the bill will encourage companies to retain their employees during these temporary closures and hire laid-off workers.
In a nutshell, the nation’s struggling small businesses will see:
• A $350 billion partially forgivable loan program designed to help companies retain their workers.
• The additional incentive of a 50% refundable payroll tax credit on worker wages for companies retaining employees.
• Relaxation of net operating loss-reduction rules.
• Delay in payment of the employer portion of Social Security payroll taxes.
• Expansion of unemployment insurance benefits for sole proprietors and other self-employed workers.
• The targeting of a portion of the $425 billion in funds appropriated to the Federal Reserve’s credit programs to help small businesses.
Nearly half of America’s private-sector workers get paychecks from companies with less than 500 employees, and a third of those work for businesses with fewer than 100 workers. The SBA and its partners — the nationwide network of Small Business Development Centers, Women’s Business Centers, Veterans Business Outreach Centers and SCORE — have long nurtured this vital sector of the U.S. economy. The record-setting stimulus bill makes the agency’s role even more important.
In these particularly trying times, the Small Business Development Center at CSU Bakersfield is helping local companies maintain access to capital by maneuvering through the red tape of loans and incentive programs.
As social distancing continues to be a necessary tool to prevent the spread of the highly contagious coronavirus, a wide range of services has been developed to counsel business owners and entrepreneurs. These free services include telephone access to experienced SBDC consultants, online resources and business guides and weekly webinars.
Examples of some recent webinars are “Telecommuting Tips and Tools” and “Managing Your Small Business During the Pandemic Crisis.”
For information about participating in upcoming webinars, which are conducted every Wednesday from noon to 1 p.m., go to the website at www.csubsbdc.com or consult the SBDC CSU Bakersfield Facebook page. Those unable to participate in a live online event can watch recorded webinars on the CSUB SBDC YouTube channel.
This is truly the place to be for current information small businesses need to navigate the crisis. In many cases, businesses directly affected by the crisis will need funding and available resources to survive.
Acknowledging that the massive help being provided to the nation’s small businesses in the stimulus plan may seem complicated, Mnuchin has promised application procedures will be simplified as program details are developed. The assistance provided by the SBDC at CSU Bakersfield will be critical for local business to keep up to date, and to identify and access benefits.
One of five service centers within the University of California, Central California SBDC Regional Network, the SBDC in Bakersfield assists small business owners in Kern, Inyo and Mono counties by providing free consulting, small business training and research. For more information, go to www.csub.edu/sbdc.
Kelly Bearden is the director of the Small Business Development Center at California State University, Bakersfield.