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COVID-19 Update for May 29: 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, May 29, 2020, here are the latest updates leaders in Massachusetts’s business community need to know.   

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Insights  <  COVID-19 Update for May 29: 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, May 29, 2020, here are the latest updates leaders in Massachusetts’s business community need to know.   

The Latest News

Massachusetts continues reopening the economy

The state continues to reopen in Phase 1, with this past Monday serving as the restart for hair salons and barbers, pet groomers, exterior car washes, and recreational marijuana shops.  Additionally, lab and office space throughout the state (except in the city of Boston) reopened at 25% capacity (and initial information showed an even lower actual physical presence), and retail began offering remote fulfillment and curbside pickup.  Depending on public health metrics, the earliest the state will move onto Phase 2, or “Cautious,” is June 8.

National News

Additional PPP guidance announced

Following up on the loan forgiveness guidance the SBA released two weeks ago, more clarity has been forthcoming.  For one, it was revealed that loans under $2 million are unlikely to be audited, and those that are and don’t meet specific requirements will most likely just need to be repaid without further action.  Additionally, PPP money can be used for bonuses (and still be forgiven), provided that the employee receiving the bonus makes less than $100,000, and the person receiving the bonus isn’t the owner of the loan.  (For previously mentioned PPP resources, please visit the Available Resources for Massachusetts Businesses section, listed later in this update.)

Paycheck Protection Program Flexibility Act passes House

On Thursday the House passed bipartisan legislation to amend the Paycheck Protection Program, making loans more accessible under the PPP by making its terms more flexible, including allowing a longer time period to use the funds, adjusting the payroll/expense ratio to 60/40 (it’s currently 75/25), and deferring payroll tax if the loan is forgiven.  The Senate is expected to take up the issue next week.

State Street Corp. to manage Main Street Lending Program

As the Federal Reserve’s Main Street Lending Program gets closer to launching, the Fed announced late last week that Boston’s State Street Corp. will serve as the custodian and administrator for the program, which is designed to provide $600 billion in support to small and medium-sized businesses and their employees across the United States.  The Fed also provided some updates this week, including Main Street Lending Program Forms and Agreements and Frequently Asked Questions (FAQs).  The program is due to go live any day.

Bank of America announces possible PPP data breach

On Wednesday, Bank of America announced that a breach occurred on April 22, as Bank of America uploaded PPP applications to the U.S. SBA test platform between the first and second round of funding.  The bank believes application information may have been visible during that time to other SBA-authorized lenders and their vendors.  Bank of America did not say how many applicants were affected by the possible breach.

Massachusetts News

Empowerment Grant for Small Businesses – deadline today at 5 p.m.

Today is the last day to apply for the Empowerment Grants for Small Businesses program, administered by the State Treasurer’s Office of Economic Empowerment (OEE).  Grants of up to $2,500 are being offered to small businesses and eligible nonprofits serving Massachusetts’ Gateway Cities.  Applications are due by Friday, May 29, at 5 p.m.

Governor Baker extends unemployment benefits

On Tuesday, Governor Baker signed into law a bill that expands unemployment insurance relief to employers and claimants.  Among other provisions, the maximum allowable claims period is expanded from 26 weeks to 30 weeks for any week in which claims exceed 100,000, employers’ experience ratings from impacts of COVID-19 and the current state of emergency are exempted, and the cap on dependency benefits (previously at 50%) is lifted.

Mayor Walsh convenes Reopening Advisory Board

Similar to the advisory board assembled by Governor Baker last month, Mayor Walsh has recently convened his own Reopening Advisory Board, comprised of business executives, health experts, labor and religious leaders, and college presidents.  A framework with operational recommendations for businesses, employers and commercial landlords was also released by the city of Boston on Thursday.

Boston Marathon cancelled

Mayor Walsh announced yesterday that the Boston Marathon would be cancelled for the first time in its history.  The Boston Athletic Association said the traditional race was “not feasible this year for public health reasons.”  The marathon will instead be held as a virtual event in September.

State accepting federal funding applications through June 5

The state is currently accepting applications from Massachusetts cities and towns for their share of $502 million in federal funds meant to address eligible costs related to the COVID-19 response effort.  Applications will be accepted through June 5.

National unemployment insurance scam reaches Massachusetts

A national scheme in which scammers are filing fraudulent unemployment claims has reached Massachusetts.  The scammers use stolen personal information from prior national data breaches to file large numbers of unemployment benefit claims through the Department of Unemployment Assistance system.

AIM announces PPE Marketplace page

In an effort to help businesses get ready to open and have the personal protection equipment they need, Associated Industries of Massachusetts plans to launch a marketplace page in the next few days to help match buyers and sellers of personal protective equipment and cleaning services.

State’s unemployment rate hits 15.1%

April saw 623,000 jobs lost in Massachusetts, skyrocketing the unemployment rate to 15.1% in April, significantly up from 2.8% in March.

Coronavirus cases in state could be much higher than reported

A new study from the Imperial College London suggests closer to 900,000 people in the state have been infected by the coronavirus, much more than the current reported infections, which are just south of 100,000.

Industry News

Construction

Phase two of Boston’s construction reopening commenced on Tuesday, allowing any construction to take place in the city that is also currently allowed throughout the state, with proper safety precautions implemented.  Cambridge entered into Phase One of its construction restart on Monday.

Education

On Wednesday, a group of 14 college presidents from institutions throughout the commonwealth released their own four-phase plan to reopening campuses.  The group is also asking Governor Baker to ask all college presidents to develop their own individualized plans based on the framework.  Most colleges are expected to announce specific details for the fall semester by July 1.

Meanwhile, colleges are starting to rethink their waitlists as uncertain enrollments and less ability to anticipate international students call into question fall numbers.

And state officials plan to provide school districts with guidance on summer programming next week, with fall guidance and reopening expected by mid-June.

Food and Beverage

Although the meat industry is trying to get back to normal, shortages could still be an issue moving forward, as currently there are more than 11,000 coronavirus cases tied to just three of the nation’s biggest meat processing plants.

Nonprofit

The nonprofit sector is struggling as many organizations’ major fundraisers have been postponed or canceled.  The financial impact many are facing could affect operations for several years.

Restaurants and Hospitality

Restaurants and retail are especially expected to benefit from the Paycheck Protection Program Flexibility Act, which passed the House earlier this week.

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:

On May 30, from 1 p.m. to 5:30 p.m., Massachusetts brewers are coming together for Fest from Home, a virtual beer festival raising money to support Project Bread.  At $5 per ticket, “attendees” can enjoy a virtual beer festival featuring live interviews, Facebook Live chats, and videos to talk beer, trends and more from 28 breweries throughout the state.  All ticket proceeds benefit Project Bread, a Massachusetts nonprofit focused on addressing food shortages and hunger.

 

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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