Government intervention has been necessary in keeping businesses operating during the COVID-10 pandemic.
Containing the spread of the novel coronavirus has required states to issue stay-at-home orders. In mid-March, Gov. Andrew M. Cuomo began restricting outside gatherings and the number of people permitted inside businesses. On March 20, he ordered all non-essential businesses closed and implemented social distancing policies for everyone.
The rationale for these measures was understandable. Controlling the rate of infection is critical to preventing as many deaths as possible.
But this has taken a toll on the economy. Nearly 17 million Americans filed new claims for unemployment insurance over the last several weeks. Numerous businesses have closed, and many more will likely shut their doors for good.
So governments on the federal, state and municipal level have put various programs into place to help businesses pay their bills in this economic slowdown.
On March 27, President Donald Trump signed a $2 trillion stimulus package passed by Congress that week. It offers about $500 billion to large businesses and about $370 billion to small businesses.
One of the provisions of the bill is the Paycheck Protection Program. Congress allocated $350 billion for this initiative to help small companies stay afloat.
This program has real benefits. The amount of a loan to any business used for designated purposes will be forgiven. The key here is keeping workers on the payroll so they will continue to receive their wages and health insurance.
About a dozen states are offering programs tailored to small businesses. But unfortunately, New York is not yet among them. Information on the website for Empire State Development says: “NYS is currently assessing options to mitigate hardships to NYS businesses.”
Local companies have had to turn to other resources to help them get by. The village of Potsdam recently announced a program it has instituted.
“A new business loan created by the village in the face of the COVID-19 pandemic is being offered to business owners within the village and current revolving loan-fund borrowers located in the town. Mayor Reinhold J. Tischler [April 7] announced the village is offering the COVID-19 Working Capital Loan Program with the goal to provide village business owners with access to small bridge loans that may be needed while waiting for more substantial programs available through the federal Coronavirus Aid, Relief, and Economic Security Act,” a story published Thursday by the Watertown Daily Times reported. “According to a news release issued by Village Planning and Development Director Frederick J. Hanss, the new loan program will be administered by the Adirondack Economic Development Corporation, and the COVID-19 Working Capital Loan Program may provide qualified borrowers with a six-month, working-capital loan for up to $3,200 at 1 percent interest. The loan term may be extended for additional time on a case-by-case basis, and the program may be used in conjunction with the AEDC’s recently launched Emergency Disaster Loan Program. … The nonprofit economic development organization based in Saranac Lake handles all of the village’s small business lending, Mr. Hanss said.
“Interested applicants may request a loan application from the AEDC by contacting Small Business Development Specialist Steven Garneau at: firstname.lastname@example.org. For more information on the village of Potsdam’s COVID-19 Working Capital Loan, contact Planning and Development Director Fred Hanss at: email@example.com.”
It’s important for local companies to have the financial resources to continue operating in the months ahead while the nation grapples with this health care crisis. So we commend Potsdam for finding a way to offer assistance; this serves as a good model for other north country governments.
But we need to hear more from state officials on how they intend to bolster the economy. Small businesses are the backbone of our communities, and the silence we’ve gotten from Albany does not display effective leadership.