New York Attorney Summarizes State and Local Incentives for Employers Impacted by COVID-19
New York attorney Lyndsey Bechtel has written an up-to-date Litchfield Alert, “State And Local Incentives For Employers Impacted By Covid-19,” wherein she identifies the various incentives New York, New Jersey and Connecticut are offering to business owners.
Background
As the federal government offers national stimulus incentives, state and local governments are also providing businesses with a variety of programs to help avoid layoffs and keep payrolls open.
Details
In addition to the federal financial assistance available through the US Small Business Administration, employers impacted by COVID-19 should be aware of the following state and local incentives:
1) The New York State Department of Labor Shared Work Program allows employers to reduce employee hours by 20-60%, and provides unemployment insurance for up to 26 weeks for this purpose. As an alternative to lay-offs, the Shared Work Program allows employers to keep their talented and trained employees ready to work when needed. Instead of laying off employees, qualifying employers can keep their employees on and paid through unemployment insurance, despite downturns in work. It allows businesses with as little as two New York employees who worked for four consecutive calendar quarters to qualify. The online application is available on the NY Department of Labor website.
2) The New York City Small Business Continuity Loan Fund provides 0% interest loan of up to $75,000 to businesses with fewer than 100 employees that have seen sales decrease by 25% or more. The online application intake is temporarily paused, however, as of April 10, 2020.
3) New Jersey employers can submit applications for the New Jersey Small Business Emergency Assistance Loan Program created by the New Jersey Economic Development Authority starting April 13, 2020, at 9:00 am. Qualifying small businesses and nonprofit organizations—those that have been in operation for at least one year and have less than $5 million in annual revenue—can apply for a direct loan of up to $100,000 upon demonstrating that they have been negatively impacted by the COVID-19 outbreak, including reduction of
business hours, 20% or more decline in revenue, disruption of supply chain, or complete business closure.
4) The New Jersey Department of Labor also posted guidance charts in English and Spanish on its COVID-19 guidance website.
5) Connecticut Governor Ned Lamont submitted a formal request to the federal Small Business Administration on March 16, 2020, seeking expedited approval of loan applications submitted by businesses based in Connecticut. The request explains that Connecticut was one of the first states to be severely impacted by the pandemic.
Summary
Lyndsey outlines two New York incentive plans, including the Shared Work Program that is being offered by New York State as an alternative to employee layoffs. This incentive enables employers the option to keep their trained staff, while also allowing them to take advantage of unemployment benefits. New York City’s Small Business Continuity Loan Fund offers no- or low-interest loans to small businesses that meet minimum employee criteria as well as a sales decrease threshold.
Lyndsey also provides information about the State of New Jersey’s loan program created through its Economic Development Authority. This state agency is offering emergency financial assistance for small businesses and nonprofits that meet certain employee count and revenue criteria. To qualify, however, the businesses must prove to have experienced a disruption in supply chain, reduction of staffing hours, interruption of business or complete closure.
Further, Lyndsey acknowledges that the State of Connecticut is formally pursuing the federal Small Business Administration loans be expedited to help support its local businesses.
Lyndsey Bechtel focuses her practice on defending a variety of claims, including bodily injury, malpractice, contract disputes, property damage, labor and employment related claims. Her clients include businesses, special interest groups, banks, credit unions, property owners, municipalities, manufacturers and professionals. To download a copy of this Litchfield Alert, click here.
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