Good afternoon everyone,
A request came in last night to write a piece on current coronavirus business assistance efforts being confined to loans.
When disasters are declared, Small Business Administration loans are offered to provide a bridge to the time when conditions return to normal.
Delaware Gov. John Carney has applied for a declaration from the SBA. The application offered numerous examples from small businesspeople on how the pandemic has hammered their enterprises.
The problem here is that businesses often spring back from natural disasters and often have insurance that covers the rebuilding process.
This time around, we are dealing with a silent foe that leaves buildings standing but comes with a loan option that may simply be too much with a business owner without savings or already coping with substantial existing debt.
Worse yet, there is no timeline for when things will return to normal despite numerous theories about sunlight, etc. This morning brought news of three new cases, including one person in critical condition in Kent County.
The state’s resources have been diminished due in part to a lack of will among legislators to substantially increase financial reserves during good times through a constitutional amendment. Populist arguments about the process aiding the rich gained some traction in Dover.
To his credit, Gov. John Carney has been able to squirrel away some funds with legislative help. Still, options will be limited as the state sees lower tax revenues.
The most recent revenue estimate lopped off $90 million that will not be available in the proposed 2020-2021 budget.
Efforts at the federal level will initially be geared to large entities as the K Street lobbyists work the phones and Email systems.
Anyone with ideas on ways to assist small businesses beyond loans is welcome to let us know. Simply hit reply to this newsletter and type away. – Doug and Sharon Rainey
