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COVID-19 Update for June 5: Here’s what Rhode Island 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, here are the latest updates leaders in Rhode Island’s business community need to know.

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Insights  <  COVID-19 Update for June 5: Here’s what Rhode Island 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, here are the latest updates leaders in Rhode Island’s business community 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, here are the latest updates leaders in Rhode Island’s business community need to know. To view last weeks updates, click here. 

THE LATEST – FEDERAL RELIEF PROGRAMS

Important changes are coming to the Paycheck Protection Program.

After several weeks of uncertainty, lawmakers have officially approved legislation that will bring a few important modifications to the federally funded Paycheck Protection Program.

H.R. 7010, known colloquially as the Paycheck Protection Program Flexibility Act, was introduced at the end of May and easily passed through the U.S. House of Representatives by a vote of 417-1. It was approved by the U.S. Senate by voice vote on Wednesday night and – at the time of this writing – was expected to be signed into law by President Trump shortly thereafter.

We wrote a full overview of these changes on our website, which you can find by clicking here. In the meantime, here are the top-level highlights:

  • Extension of the covered period: The legislation passed this week extends the covered period of PPP loans from 8 weeks to 24 weeks.
  • Changes to rules for usage: Originally, in order to be eligible for forgiveness, business owners were mandated to use at least 75% of their loans to cover payroll costs. This legislation brings that minimum level down to 60%, freeing up 40% of the loan to cover non-payroll costs such as mortgage interest, rent and utilities.
  • Payroll tax deferral: The legislation amended the CARES Act to include language to clarify that all PPP borrowers (including those that receive forgiveness) will still be able to take advantage of payroll tax deferral provisions.
  • Loan forgiveness reduction relief: The legislation extends the period in which an employer may “eliminate a reduction in employment, salary or wages” (in other words: the period in which an employer can rehire staff members who were furloughed or laid off) to December 31, 2020.

All in all, the modifications to the PPP included in H.R. 7010 will give the tens of thousands of borrowers across the country a bit of much-needed flexibility as they continue their efforts to navigate this crisis.

We do not expect this legislation to be the last important update regarding the Paycheck Protection Program. Our team is keeping a close eye on the latest developments and will post further information on our website.

The Main Street Lending Program is launching soon.

The $600 billion Main Street Lending Program, created with a target audience of “midsized companies with 15,000 employees or less,” is set to launch very soon, according to Federal Reserve officials. The program will be implemented by the Federal Reserve Bank of Boston, which recently released a slew of clarifying guidance and other documents.

Stephen Bonder and Barry Sussman with blumshapiro outlined the latest information in an article for our website, which you can find by clicking here.

Details on the next federal stimulus package are still TBD.

We don’t know what the next federal stimulus package will look like, but most observers agree that the $2 trillion CARES Act won’t go down as the last sweeping financial relief bill passed during this COVID-19 crisis.

As you’re likely aware, the Democrat-controlled House of Representatives approved a $3 trillion package known as the HEROES Act a few weeks ago. That bill is not expected to gain much traction in the Republican-controlled Senate.

Meanwhile, White House officials have hinted that they are moving toward working on developing a new proposal, which reporters say would aim to boost the domestic economy and encourage Americans to get back to work. The as-yet-unnamed package, according to reports, would come with a roughly $1 trillion price tag.

We’re closely tracking these negotiations, and we’ll provide the latest on our website.

THE LATEST – REOPENING RHODE ISLAND

Let’s start with the latest numbers…

As of Thursday evening, 15,325 Rhode Islanders had tested positive for COVID-19. One-hundred and eighty-five patients were in the hospital, and 756 individuals had unfortunately passed away due to the virus.

Over the course of the pandemic, the state of Rhode Island has processed nearly 166,000 COVID-19 tests. The total rate of positive tests is currently hovering around 9 percent, although it should be noted that recent daily positive test rates have consistently been in the low single digits.

We’re one week into Phase II of the ReopeningRI process.

Thanks to a steady decline in daily positive cases, combined with a steady uptick in daily completed tests, Rhode Island’s economic reopening process continues to progress. This was the first week of the second phase of the state’s comprehensive approach to loosening restrictions and reopening the business community, and it brought with it a return to some semblance of normalcy.

Want to go to the gym? Good news: Now you can (but don’t expect to hang out in the sauna). Desperate for a haircut? Go ahead and make an appointment (but just keep your facemask on while you’re in the chair). Tired of cooking? You can make a reservation at your favorite restaurant (but brace yourself for a paper menu rather than anything fancy).

You get the picture: Rhode Island is significantly more open today than it was a few weeks ago, but social distancing and sanitization are still the name of the game.

The latest industry-by-industry guidance can be found at www.ReopeningRI.com.

What about returning to the office?

We know many professionals are itching to get back to the routine of going into the office every day. We also know many professionals are getting used to working from home!

As for the statewide rules for returning to the office… it depends on where you work. State leaders are still encouraging anyone who can work from home to do so, but they have permitted office-based employers to permit some of their workforce to return to the office environment.

For further reading consideration, Inc.com published an interesting series of “return to work” articles; here are a few links.

In case you missed it…

Statewide public health officials and the Commerce department teamed up last week to host a series of virtual Town Hall discussions related to specific industries. Here’s a sampling:

Follow Rhode Island Commerce on Facebook to find any additional webinars and information.

What’s next?

The Ocean State’s relatively quick progress – especially when compared to our neighbors in the Northeast – on reopening its economy is certainly welcome news, but Rhode Island still has a lot of obstacles to clear along its journey to a post-COVID future.

The big one: How are we going to fill a projected budget deficit that may run as high as $800 million?

The governor and other state leaders believe they will be able to use federal relief funding to solve some of our big-picture financial problems, but it’s safe to assume significant cost-saving measures are soon to come.

An early sign: State employees are currently being asked to volunteer for what’s known as a WorkShare program, a federally authorized initiative that – in its simplest terms – would help the state save money while keeping its employees’ regular salaries mostly intact.

Basically, employees that volunteer for the WorkShare program would accept reduced hours and pay from their employer (the State), but they’ll be eligible to recoup some of their lost wages via federal unemployment funds.

As for what’s next on the state’s reopening plan…

Governor Raimondo has not yet attached a concrete timeline to Phase II, but it seems as though we won’t see the beginning of Phase III for at least another couple of weeks. For now, business owners who want to get ahead on their reopening processes would be wise to start filling out some paperwork.

Here’s where to start.

  • COVID-19 Control Plan: If you’re planning to reopen, you’ll need to develop a written plan outlining the steps you’re taking to prevent the spread of COVID-19 in the workplace. The state has provided an easy template for this plan, which you can find by clicking here. An important note: You don’t need to submit this plan for approval. Just fill it out, sign it and put it in a drawer; you may need to present it in the case of an inspection.
  • COVID-19 Checklist: All businesses planning to reopen also need to print, sign and display a COVID-19 Checklist. You can download and print the checklist by clicking here.

THE WEEK AHEAD – UPCOMING WEBINARS, TRAININGS AND MORE

ONGOING: Lt. Gov. Dan McKee continues hosting town halls.

Lt. Gov. McKee will only be hosting these town halls on Tuesdays at noon; Fridays are canceled until further notice. These town halls cover a wide range of topics related to the COVID-19 crisis. They are free to join and open to the public.

Here are a few ways you can join:

Here are a few more virtual events to add to your calendar…

The era of Zoom, Google Hangouts, GoToWebinar and other virtual platforms continues. Here are a few upcoming webinars, professional development courses and other virtual resources on the docket for next week and beyond (plus a few you may have missed).

ONGOING – FINANCIAL RELIEF PROGRAMS FOR BUSINESSES

We’ve mentioned most of these programs in prior weekly updates (after all, this is our tenth COVID-19 weekly update) – but they’re still available, so we keep including them. Feel free to keep scrolling if you’ve read our past dispatches.

Lt. Gov. McKee proposes new financial support programs for small businesses

Lt. Gov Dan McKee, who also serves as Chair of Rhode Island’s Small Business Advocacy Council, is calling on the state to create a “CARES Act-funded grant program and a state-guaranteed loan strategy to help compensate small businesses that have been most financially impacted by COVID-19.”

Read his full press release by clicking here.

Rhode Island rolls out Microenterprise Stabilization Grant Program (MSGP)

Introduced by Rhode Island Commerce on Thursday, April 23, the MSGP is designed to provide financial relief to small businesses that have been impacted by COVID-19 but left out of federal stimulus programs. The program can provide up to $5,000 to so-called microenterprises, which are defined as “bona fide business entities with between two-five employees” whose owners’ total household income must be 80% less than their hometown’s median income.

These loans are only available in participating towns and cities across Rhode Island. Learn more about the program, and find the links to apply, by clicking here.

Staying with Rhode Island Commerce, here are a few additional resources:

Small Business Administration resources

The Small Business Administration’s Rhode Island District Office is promoting a couple of webinars scheduled for next week. Sign up by clicking here.

Plus, remember: The SBA funds a network of partners that offer local businesses free counselling and guidance through this crisis. Here are the links to learn more:

INDUSTRY SPOTLIGHT – Long-Term healthcare

Long-term care providers, for the past two-plus months, have been working tirelessly to take care of a large percentage of our nation’s elderly and infirmed population. Here are a few recent stories from around the Web related to the industry:

Finally, blumshapiro partner Jonathan Fink laid out his thoughts on the road to recovery for long-term care providers. You can read his analysis by clicking here.

INDUSTRY SPOTLIGHT – Construction

We talked about the Paycheck Protection Program Flexibility Act a few thousand words ago. The national construction industry says these modifications to the PPP will help “save construction jobs.” Read the statement from the Association General Contractors by clicking here.

We’ve compiled additional resources for the construction industry on our website. Find them by clicking here.

LOOKING AHEAD – THE NEW NORMAL

What does life after COVID-19 look like? That’ll be the question we all have to figure out together. Here are a few interesting look-ahead takes from the past week.

OUR INSIGHTS: INDUSTRY-BY-INDUSTRY

Our team at blumshapiro is working every day to provide you with the latest information pertaining to the individual industries in which you operate. You can find real-time updates within the following links:

Our firm’s complete suite of COVID-19 webinars, articles and federal and state guidelines can be found by clicking here.

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

 

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.

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