Save Our Community and Provide Support to the Businesses of St. Mary’s County, Maryland.
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To our governors, mayors, and legislators:
Imagine for a moment, St. Mary’s County without it’s beloved restaurants and bars. Those cherished third-generation “Mom and Pop’s” and those businesses that have become local landmarks that bring tourists, have become the livelihood of so many residents, draw new people/businesses to make their move to our county, and increased real-estate value and overall appeal to neighborhoods. Although St. Mary’s County may be small in size, our county ranked highest in the whole country for highest concentration of aerospace engineers per capita and generates hundreds of million dollars in tourism industry sales according to published reports by St. Mary’s Dept. of Economic Development. The potential for a growing county to become a county full of shuttered doors and the inability to maintain development was once was unimaginable. The current crisis has a very real potential for becoming the end of the charm and draw for current and future residents of this county.
Restaurants and bars are defining and vital contributors to St. Mary’s County and Maryland as a whole. As restaurant and bar owners, staff, patrons, and the members of the St. Mary’s County community, and residents of the great state of Maryland, we’re requesting swift action and commitment from our local and state governments, that is necessary at this moment to be afforded a chance to keep these businesses and county alive. As a large private employer in St. Mary’s County, the restaurant industry here will be hit harder than any other industry in our county. Local and state government has an opportunity to change that dire outcome.
Our industry is dark now, and the question we are all facing is not when to reopen but how we reopen? In the wake of this pandemic, restaurants are forced to accommodate the need for costly health and safety protocols for staff, social distancing for guests, restrictions regarding outside dining options, loss of event and catering revenue, increased costs for packaging for takeout and delivery, new fees for 3rd party delivery, and potential future and unknown disruptions. Our government’s focus has primarily been on safety measures for reopening and outlining restrictions. These efforts will be moot if restaurants can’t re-open because they lack clarity and are set up for failure with a one size fits all approach.
It’s a fallacy to think new businesses will emerge in their place during this recovery period because it will take time due to the state of our economy. Jobs lost by restaurant workers will not be reabsorbed elsewhere because of the COVID-19 driven recession and the reality that other industries don’t don’t offer true entry level positions or relevant positions that can accommodate our employee demographics and skill sets. St. Mary’s will be faces with record high unemployment, pressure on social services, people leaving our beloved city for greater opportunities elsewhere. That means empty storefronts, decline in tourism, and extinguishing the growth and development so important to St. Mary’s County.
Just as many individuals live from paycheck to paycheck, so too do restaurants and bars. We cannot work from home, most have temporarily converted to delivery and carry-out and continue to lose most of our revenue and the tips our employees depend upon to survive. Without significant help, many if not most of us will vanish, and our communities will be forever changed.
We implore you to engage with local industry leaders to provide the necessary considerations and support required to give local restaurants the best chance for survival. The needs vary from businesses to business but at a minimum, we humbly implore you to please consider:
- Providing county level leadership including county commissioners and Department of Health the ability to make common sense considerations regarding the current restrictions in place. Allowing our local government the opportunity to work directly with businesses and make decisions to not only increase restrictions, but allow changes to provide accommodations when such are deemed safe and viable.
- We propose an outdoor dining solution for restaurants we call "Curbside Plus," an intermediary step between the current allowed curbside service and the next logical step (resuming indoor restaurant service). Allowing restaurants the ability to generate revenue in a safe manner with outside dining options by working together with government officials, public health policy experts. Additionally, allowing businesses without current outside dining options the ability to work with the same officials, experts, and resident of their community the options to create spaces for outdoor dining that includes socially-distanced tables for a maximum of 2-4 guests. Customers would order food and beverages as they do now, pick it up, and have the ability to eat it at tables in special these outdoor food courts. Restaurants would be responsible for sanitizing the tables in between uses and we want to work together with government and public health policy experts to create the protocols to ensure we're not endangering the public health or safety. As our residents are able to resume their trips to parks, beaches, and other outdoor public areas, restaurants should be afforded the opportunity to generate revenue with outdoor dining with the same approach to safety and logic.
- Providing updated information and expedited emergency employment benefits to all hourly and salaried workers who have been laid off or lost their pay for the length of this crisis as promised. Many have yet to see any benefits.
- Sales tax is and will be owed by affected businesses. A policy of forgiveness should be considered. An appropriate option could be a credit to the business, or eschew remitting sales taxes for a given time. Distribute as assistance to their workers/ anyone who has worked for them in the affected 4, 6 or 8 weeks.
- SBA Loans - Anyone taking out a loan to raise capital to reopen their business should be able to receive these loans at no interest. The businesses that choose to reopen and secure SBA loans cannot afford the additional expense of interest rates as they try to recover, support displaced employees, and begin serving their communities again.
- Liquor License Renewals - Reset a new date for compliance, effective 4 weeks after business is able to resume to full operations in St. Mary’s County.
- Additional Cash Grants - The adjustments listed above will help but not solve the financial assistance required. Consider reallocating money from other areas of our state and local budgets or working with local foundations or fast tracking 501-C3 designations to organizations to begin granting money to individuals and businesses alike. Apply that money to local industry workers, restaurants, and rebuilding our infrastructure.
- Delivery and Food Supply - Under the emergency powers of the Governor, they must mandate that fees charged by third-party delivery platforms to our local restaurants be capped at a maximum 10% per order. Currently, third-party delivery fees range from 15% - 30%+ of a total order and would therefore amount to a windfall during this emergency when restaurants can only offer takeout and delivery. Many restaurants lose money on their deliveries during normal market conditions. We must preserve some profit for restaurants so they can serve St. Mary’s County residents.
- Fine, Tax, Penalty, Utility and Insurance Premium Forgiveness - Suspend the payment of all insurance premiums (and protect against a spike in premium related to COVID-19), utility payments, fines and provide cure periods to businesses for violations that do not pose an immediate hazard to the public and workers. All taxes, fees, premiums and fines must be suspended indefinitely until a thorough and thoughtful strategy can be implemented to address these payments. This includes, but is not limited to Liquor License renewal fees.
- Insurance Coverage - Government should compel insurers to pay business interruption insurance claims related to COVID-19, or a specialized business recovery fund should be established to promptly pay claims to businesses required to close (or limit their operations) by government order. When necessary, the federal government must provide the insurance companies appropriate assistance.
- Lawsuits - Regardless of precautions businesses take when they are permitted to reopen, public health officials believe there will still be unavoidable risks to the public and workers related to COVID-19. Therefore, liability protections should be enacted for restaurants and nightlife establishments operating in good faith that are operating in accordance with applicable statutes, rules, executive orders and approved sector-specific restart plans, they must be protected to ensure our economy is not further devastated by COVID-related lawsuits during the recovery period.
- License Renewals - All licenses and permits such as liquor licenses, Health Department permits, etc., must renew automatically without the payment of licensing fees until a strategy can be implemented to responsibly reopen such operations. Specifically, extend all expiring liquor licenses renewal for 120 days automatically. They cannot afford thousands of dollars in licensing fees if they are closed.
- Paycheck Protection Program (PPP) - Amend the Paycheck Protection Program (PPP) of the CARES Act to allow the loan to be forgivable if businesses hire back needed staff at a minimum of six months after they fully reopen; allow a larger allocation of the money to be used for rent or other expenses; and, expand the stimulus funding so it is available over a longer period of time, so businesses who do not immediately apply can still obtain funding. Also, require all participating banks to accept, review and qualify applications from any small business without requiring them to have existing accounts or loans. If these amendments are not made, the PPP will not help countless businesses that need stimulus funding.
- Personal Liability in Leases - Most small business owners have personal guarantees on their leases as long as they are in possession of the premises. These clauses were designed to protect landlords from tenants being open and operating but not paying rent. They were never contemplated for this situation where the tenant is technically in possession but cannot operate by government order. It is detrimental enough that many small business owners fear losing their business, but now they are in fear of losing their personal home or savings. As the government ordered them closed, the government needs to override these personal guarantees for businesses that it shut down for public safety reasons.
- Rent and Mortgages - Due to the ongoing COVID-19 emergency, a majority of businesses in our county have been forced to close (or limit their operations) and many cannot pay their rent. Property owners have financial obligations and much of which is paid for by the rent from businesses. While we recommend that commercial tenants and owners make arrangements per their circumstances to help both parties weather this crisis, we recognize that realistic terms may not always be available. Therefore, we recommend a government backstop be provided during this emergency. These government programs could include direct federal financial assistance, rent and mortgage forbearance, and/or a property tax deduction for landlords who provide rent concessions to their tenants.
- Reopening Grants and Loans - Reopening restaurants and nightlife establishments will take capital to rehire employees, restock, etc, which is money most small businesses do not have. So, we recommend providing grants and low interest, long term reopening loans.
- Cut the Red Tape & Reduce Fines - Review all laws and regulations governing restaurant/bar establishment to determine which are antiquated, duplicative or inappropriate. We should then amend or repeal the identified mandates to streamline the permit and licensing process and enhance the experience businesses have when interacting with the government. This should require that inspectors educate businesses first, by explaining why a violation exists and how to correct and prevent it. The goal should be to reduce fines, increase education and compliance, and provide a warning or cure period before a fine is levied for any violations that do not pose an imminent hazard to the public.
The COVID-19 crisis has impacted us all in many ways. We acknowledge this is a serious public health threat, especially for those at-risk with preexisting conditions. This crisis demands responsible leadership and innovative solutions to meet the myriad challenges. Restaurants are particularly hard-hit by the economic impact of mandatory closures. Governor Larry Hogan recently saw fit to begin Phase 1 of his reopening plan and the net effect of these actions has resulted in picking winners and losers among businesses. We cannot, and will not, sit idly while waitIng for a plan from our government. We, the businesses owners, residents, and taxpayers of the great county of St. Mary’s are demanding our voice be heard and the heart of our community be supported before its demise.
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