Micro Businesses Emergency Funds COVID-19

Micro Businesses Emergency Funds COVID-19

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Micro Businesses Emergency Funds Petition Corvid-19

The coronavirus (COVID-19) outbreak has impacted every American institution. Small businesses employ 47 percent of private-sector workers in the U.S., meaning nearly 60 million individuals depend on them to support themselves and their families. These businesses range from your local, independent restaurant, barbers/stylists/beauticians,  creative freelancers, boutiques, consulting businesses, to the self-employed accountant. Unlike large corporations, these businesses typically are not flush with liquidity and disruption or extended delay in cash flow will either force them to close or take on more debt through high-interest lenders.

Per MN DEED EMERGING ENTREPRENEURS ANNUAL REPORT 2018: 

“...compared to white-owned businesses, minority-owned businesses have a significant disparity in ownership, access to capital and sales”
outlines opportunities and disparities faced by minority small businesses

https://mn.gov/deed/assets/emerging-entrepreneur-board-annual_tcm1045-357003.pdf

While lawmakers have taken some immediate steps, we believe there is more that lawmakers can do to help businesses and workers weather the impact of COVID-19 on the economy. Minority and other disadvantaged businesses already face many barriers as most of the regular programs and resources are not geared towards them.

 In light of all these challenges, we are calling on the Governor, the Department of Employment and Economic Development and County governments to support the creation of an emergency grant program to assist self-employed, micro and small businesses to help us in weathering this storm and for continued sustainable support.

We have the following ask:

Disaster Relief Fund for 1,000,000.00 dollars, that will be redistributed as micro-grants.

Disaster relief: The current government’s disaster relief programs simply do not work for the self-employed and micro-business community. There needs to be an appropriate fund for self-employment assistance and micro businesses for those that are people of color owned, have a net profit of $250K or less, and have 0-5 employees.  These funds need to be a mix of micro-grants, and micro-loans, with 0% interest rates, payable over 10 years, with a 50% forgivable option.

Along with these relief funds, the technical assistance component is essential to the success of these measures being provided.

Tax and debt deferral: The deferral of the April 15 deadline for federal tax returns should be expanded to include the subsequent two quarterly tax payment deadlines, which place a significant financial burden on the self-employed. The state also could negotiate deferred mortgage and credit card payments for self-employed micro-businesses, who often operate out of their homes and are funded with personal credit cards. We would recommend that governors delay sales tax remittance in support of small businesses.

Direct assistance: Most self-employed and micro-businesses don’t have adequate health care coverage, and business benefits such as paid sick leave, nor the ability to cover the costs they currently face, including lost business, and other fixed expenses. Many may not be able to benefit from the direct payments for all Americans, therefore easy access to the state health care coverage is necessary and application deadlines need to be extended.

Unemployment protection: The state should immediately fund an unemployment protection fund for the self-employed and gig workers, who are not eligible for unemployment protection. This would allow them to draw down benefits faced with declining income. The current application will need to be amended to allow for these categories of employers to be able to apply.

long-term family and medical programs for owners, employees, and caregivers:

The state should establish a program providing partial wage replacement for small business employees and the self-employed to handle serious health conditions for themselves, family members, or loved ones they are caring for, including parental leave. This program needs inclusive of the self-employed and micro-business community

We all know that it is our micro and small businesses that help communities to thrive, and they are the wealth-building engines of our communities. They need to be supported with the necessary tools to stabilize through these times, and any potential recession that is to come.

Sincerely,

Business Community Collaborative



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