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COVID-19 Update for June 5: Here’s What Massachusetts Businesses Need to Know

As the news surrounding the global COVID-19 pandemic continues to evolve, our team at blumshapiro is staying focused on answering the local business community’s most pressing questions. As of Friday, June 5, 2020, here are the latest updates leaders in Massachusetts’s business community need to know.   

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Insights  <  COVID-19 Update for June 5: Here’s What Massachusetts Businesses Need to Know

As the news surrounding the global COVID-19 pandemic continues to evolve, our team at blumshapiro is staying focused on answering the local business community’s most pressing questions. As of Friday, June 5, 2020, here are the latest updates leaders in Massachusetts’s business community need to know.   

The Latest News

Governor Baker to announce Phase 2 tomorrow

Governor Baker has said he will announce tomorrow (June 6) the start date for Phase 2 of the Massachusetts reopening.  Depending on public health metrics, the earliest Phase 2 can start is Monday, June 8.  Earlier this week, he gave a glimpse into what to expect, including more information regarding the reopening of summer camps and childcare facilities.

WEBINAR:  Examining the Risks Associated with Remote Work (blumshapiro)

National News

Update on Paycheck Protection Program Flexibility Act

On Wednesday the Senate passed the Paycheck Protection Program Flexibility Act, which makes loans more accessible under the PPP by making its terms more flexible, including allowing a longer time period to use the funds (from 8 weeks to 24 weeks), adjusting the payroll/expense ratio to 60/40 (from 75/25), and deferring payroll tax if the loan is forgiven.  The bill is now headed to the president for signature. (For previously mentioned PPP resources, please visit the Available Resources for Massachusetts Businesses section, listed later in this update.)

CBO says effects of pandemic to be felt by economy for years

New projections released by the Congressional Budget Office earlier this week predicted that economic fallout as a result of the COVID-19 pandemic will shrink the U.S. economy by approximately $8 trillion over the next 10 years.

Update on Main Street Lending Program

Last week, the Federal Reserve Bank of Boston issued initial guidance, and yesterday held an “Ask the Fed” webinar to provide more information on the Main Street Lending Program, which is due to go live any day.

Fed expands Municipal Liquidity Facility

On Wednesday, new guidance from the Federal Reserve Board dramatically expanded access to its $500 billion local government debt facility, previously known as the Municipal Liquidity Facility.  Originally open to all cities with a population of more than 1 million residents and counties with 2 million or more residents, the new guidance allows states to have at least two city or county governments qualify regardless of size.  It also lowers population thresholds for cities to 250,000, and counties to 500,000.  The new guidance also gives governors flexibility in designation, including directing funding to public transit, airports, toll facilities and utilities.

Administration begins discussions on next stimulus package

In response to the House-passed HEROES Act, which calls for nearly $3 trillion in spending, the administration is starting discussion on its own version of the next stimulus package, which could include incentives for people to find jobs, take vacations and eat out at restaurants.  Although the Senate is not expected to take up the HEROES Act, they could suggest a smaller follow-up stimulus package (estimated closer to around $1 trillion) based on the administration’s suggestions.

CDC wants employers to encourage employees to drive to work

Recently updated guidelines from the CDC include the recommendation that employers encourage their workers to drive to work, and perhaps provide incentives to employees who do so, to avoid people using public transportation during peak hours.

Massachusetts News

Massachusetts Senate to hold listening sessions related to economic recovery

Earlier this week, the Massachusetts Senate announced it planned to hold a series of virtual listening sessions.  These sessions will provide lawmakers the opportunity to hear from stakeholders and policy experts when considering policy proposals related to the state’s reopening and recovery.

New state legislation enacted to combat fraudulent unemployment claims

Due to the rising number of fraudulent unemployment claims, Massachusetts has joined other states in adding extra security measures for unemployment claimants filing for benefits.

Boston’s offices reopen

Boston, Cambridge and Somerville allowed non-essential offices to open to employees this week, a week after the Governor’s recommendation.  Still, many employees continued to work remotely, which was reflected in the lack of people or traffic downtown.

Business confidence levels rise slightly in May

After business confidence fell into negative readings in March and declined in April, business confidence in Massachusetts picked up slightly for May, increasing by 3.7 points to 42.1, although still below the 50-point-mark which designates an “optimistic outlook.”

Industry News

Healthcare

Earlier this week, the state released guidelines for visiting loved ones in nursing homes.  Effective June 3, the ban prohibiting all visitors was lifted, and visits can commence following specific guidelines.

Human Resources and Employment Law

As small businesses reopen across the country, they’ll need to take certain precautions to avoid potential lawsuits.

Life Sciences

Cambridge-based Moderna was one of five firms selected by the administration as the most likely to develop a coronavirus vaccine.  It is hoped by narrowing the field of focus, critical resources can be directed more quickly toward faster vaccine development.

Restaurants and Hospitality

Governor Baker is expected to announce more expansive guidance and a specific start date to the state’s Phase 2 reopening tomorrow.  (Phase 2 could start as early as Monday, June 8.)  Restaurants will be limited to outdoor dining only at the start of Phase 2, with indoor dining expected to be allowed later in Phase 2.

Also, the Restaurant Relief Act moved forward in the Massachusetts House of Representatives on Wednesday and will move onto the Senate.  The bill allows for to-go cocktails, caps on third-party delivery service fees, and waived interest and penalties on late meals tax payments.

Available Resources for Massachusetts Businesses 

Previously mentioned PPP resources:

Additional and previously mentioned resources:

How You Can Help

The community-minded response of Massachusetts’ business community has been nothing short of extraordinary.  There are plenty of ways to contribute to the statewide effort to navigate this crisis.  Here are few:

Future Updates and Additional Resources

We will be providing regular updates over the next several weeks as new developments are made available.  If you have any questions whatsoever, please do not hesitate to reach out.  We are here to help you with your tax and business advisory needs.

In the meantime, you can refer to the following state agencies and associations for the latest information:

And a Last Good Word…

We all need some good news right now – here’s some from this week:

Back in April we told you about Lovepop, a Boston-based business founded by best friends and naval architects John Wise and Wombi Rose that is known for beautiful laser-cut pop-up cards but that recently shifted gears to contribute to the effort of providing desperately needed PPE.  Well, we are happy to offer this update:  they are succeeding at their new mission, and recently donated 100,000 medical gowns to Massachusetts hospitals, with the expectation that they’ll donate more than a million gowns over the next couple of months.  Congratulations, Lovepop, and thank you!

 

COVID-19 Business Resources

 

Disclaimer:  The contents of this resource are for general informational purposes only. While every effort has been made to ensure its accuracy, the information is provided “as is” and no representations are made that the content is error-free. We have no obligation to update any content, comments or other information for retroactive or prospective interpretations or guidance provided by regulators, financial institutions or others. The information is not intended to constitute legal advice or replace the advice of a qualified professional. There are areas of the CARES Act where additional clarification from the Treasury Department and the SBA is needed. Your judgment and interpretation of the act may be needed. Users should consult with their legal counsel and representatives of the lending institution regarding the proper completion of their application and supporting documentation.

Any written tax content, comments, or advice contained in this article is limited to the matters specifically set forth herein. Such content, comments, or advice may be based on tax statutes, regulations, and administrative and judicial interpretations thereof and we have no obligation to update any content, comments or advice for retroactive or prospective changes to such authorities. This communication is not intended to address the potential application of penalties and interest, for which the taxpayer is responsible, that may be imposed for non-compliance with tax law. 

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