The Long Island Association, a regional business advocacy group, was supposed to host its spring luncheon Friday, featuring retired Yankee great Alex Rodriguez, but instead it held an hour-long webinar to offer information and advice on how businesses can stay alive during the COVID-19 outbreak.
Businesses “are the lifeline of Long Island,” the LIA’s executive director, Kevin Law, told an audience of 600, who listened in via the internet. “So many of our businesses are struggling.”
Hundreds of thousands, if not millions, of employees have been laid off in recent weeks as states like New York have closed “non-essential” businesses to slow the rate of coronavirus infection.
Right now, Law said, the federal government is not offering direct relief to business owners, except in Small Business Administration Economic Injury Disaster Loans. The loans only go to businesses that are “unable to pay ordinary and necessary business expenses” because of a crisis like the coronavirus outbreak, he said.
As of Friday morning, the SBA was still charging interest on those loans, Law said. But under federal relief legislation being considered in Congress, interest could be reduced to zero, provided a business holds onto its employees through the crisis, he said. It was unclear at press time if that measure would pass.
Law urged business owners in need to apply for SBA loans, but suggested they might wait until there was greater certainty whether the federal government would charge interest on the loans. In this way, business owners would not have rescind their first loan application and apply again.
There was discussion on tenant evictions for business owners unable to make their rent. Law noted that Governor Cuomo placed a stay on all evictions for 90 days. It was unclear, however, whether rent would be forgiven.
Law also noted that landlords must pay mortgages on their properties to banks. If businesses cannot make their rent, landlords cannot pay their mortgages, and banks cannot meet their obligations. Here, Law said, federal intervention would likely be needed to ensure all parties are made financially whole.
Law said digging out of the economic hole that the coronavirus crisis has caused will require a coordinated regional approach, through the Regional Economic Development Council, which he and Hofstra University President Stuart Rabinowitz head.
“There are certain things that we can do immediately…” Law said. “Then there are things that will require longer-term planning.”
To apply for a SBA loan, go to SBA.gov.