We wanted to update everyone on additional information we have received over the last couple of days concerning emergency relief funds.  We thank all of you who have shared information and resources that you have accessed on your own.

First, we want to share some steps you should take prior to applying for relief funds, which we will go into more detail below:

• Compile a detailed list of ALL of your creditors

• Rent (Landlord) or Mortgage/Construction Loan (Bank)
• Utilities
• Accounts Payable (outstanding invoices)
• Payroll (cost per week/biweekly)
• Credit Card(s)
• Insurance

• Know how much you owe each of your creditor monthly and the combined total

• Contact your creditors and ask about…

• Deferring payments or paying interest-only
• Waiving fees
• Temporary reductions or abatement in fees, payments, etc.
• Do this for each creditor on your list

• For funding, your first call should be to your bank, if you have a good history with your bank you may be able to get approved for a small amount of funding or line of credit relatively quickly. If you have been in business for two years obtaining a line of credit should be your first call.
• Insurance – The Maryland Insurance Administration issued this press release:

“The Maryland Insurance Administration is receiving a high volume of inquiries about Business Interruption insurance.

Business Interruption coverage is typically triggered under a commercial insurance policy when a covered risk / peril causes physical damage to the insured premises resulting in the need to shut down business operations. For example, if a fire damages a business and the business cannot operate during repairs, business interruption coverage would be available subject to the terms and limits in the policy.

Most policies require a waiting period of 24 to 72 hours before coverage begins and coverage continues for the reasonable period of time to restore the property and reopen, subject to the coverage limit of liability.Some commercial policies provide Business Interruption coverage when a business is shut down due to an Order by a civil authority.However, the policy still typically requires a physical loss from a covered peril as the underlying cause of the business shut down to apply.

All insurance policies have exclusions of coverage for risks that are too great to be underwritten at an affordable price.For example, commercial and personal property insurance policies typically contain specific exclusions for loss or damage caused by war, nuclear action and radiation.The potential loss costs from such perils are so extreme that providing coverage would jeopardize the financial solvency of property insurers. Global pandemics like COVID-19 usually fall into this category. However, policies can be different. We recommend that businesses review their policies and reach out to their insurance professionals with any questions.

The Maryland Insurance Administration would like to reassure Maryland businesses that we are closely monitoring insurance issues related to COVID-19. Our core mission is making sure insurance companies treat customers fairly and follow the provisions in their policy and applicable state laws. We are monitoring relief activity efforts aimed at assisting individuals and businesses at the local, state and federal levels.As information regarding relief programs becomes available, it will be posted on our website:www.insurance.maryland.gov.”

We have also just learned about the COVID-19 Layoff Aversion Fund – Workforce Development and Adult Learning: https://www.dllr.maryland.gov/employment/covidlafund.shtml

The fund was designed to support businesses undergoing economic stresses due to the pandemic by preventing or minimizing the duration of unemployment resulting from layoffs. The grant is up to $50,000, and the Department of Labor is now accepting applications. It can help as follows:

• Providing funds to cover the cost of purchasing remote access (ex. computers, printers, etc.) equipment to allow employees to work remotely from home versus being laid off
• Providing funds to cover the cost of purchasing software or programs that an employee would need to use from home
• Supporting businesses that take advantage of the Unemployment Insurance Work Sharing Program by supplementing the employee’s income and benefits
• Providing funds to cover the costs of cleaning/sanitization services so that small businesses are able to keep employees at work on site, but only if a frequent deep cleaning to prevent exposure occurred
• Paying for liability insurance for restaurants that convert to delivery while under emergency circumstances
• Providing funds for training or professional development opportunities for employees to avoid layoffs
• Adopting other creative approaches and strategies to reduce or eliminate the need for layoffs in the small business community

We have also spoken with several clients who have applied for the Maryland Small Business COVID-19 Emergency Relief Grant Fund: https://commerce.maryland.gov/fund/maryland-small-business-covid-19-emergency-relief-grant-fund

So far everyone who has applied has gotten through the application fairly easily.  We have been able to assist and provide information needed, such as their NAIC code, unemployment insurance account number, and interim financial statements. If your business is being affected by COVID-19, we urge you to apply for this grant, as well as other assistance.  This grant is not a loan and does not need to be repaid.  It grants up to $10,000 and can be used to support payroll expenses, rent, mortgage payments, utility expenses, or other similar expenses that occur in the ordinary course of operations.

Businesses or nonprofits must demonstrate financial stress or disrupted operations, which may include but are not limited to:

• Notices from tenants closing operations and not paying rent caused by loss of income.
• Notice of inability to make loan payments due to reduced sales, suspended operations.
• Increased cost related to COVID-19 prevention measures.
• Notice of disrupted supply network leading to shortage of critical inventory or materials.
• Other circumstances subject to review on a case by case basis.

You can also apply for the Maryland COVID-19 Emergency Relief Loan Fund which provides amounts up to $50,000 available to assist for-profit businesses. https://commerce.maryland.gov/fund/maryland-small-business-covid-19-emergency-relief-loan-fund.

It can be used for the same purposes as listed above for the grant, and businesses must show financial stress in the same areas. It is a 36 month loan with 0% interest for the first 12 months, 2% interest for the remaining 24 months. Payments are deferred for the first 12 months.  Loans of up to $50,000 are available and the term and conditions are as follows:

• Businesses established prior to March 9, 2020 and in good standing
• Fewer than 50 employees
• Personal credit score of at least 575
• No collateral requirements
• Two years of historical financial statements (if available) and most recent interim statement of business revenue
• Six month pro-forma of estimated lost revenue or other documented loss

Facebook has announced they will be providing $100 million in cash grants or advertising to small businesses. For more information go to www.facebook.com/grantsforbusiness

The nonprofit organization Kiva provides 0% interest loans to small businesses worldwide. They are expanding eligibility and the number of loans provided during this crisis. For more information, go to  https://www.kiva.org/blog/support-local-businesses-during-the-coronavirus-pandemic

Lastly, do not forget the US Small Business Administration. The US Small Business Administration has received funding authorization to provide $50 billion in Economic Injury Disaster Loans (EIDLs) for small businesses affected by COVID-19

For more information, visit the SBA Disaster Loans website. You can also contact the SBA at 1-800-659-2955 (800-877-8339 for the deaf and hard-of-hearing) or by emailing disastercustomerservice@sba.gov.

We want to help everyone of our clients get through this unprecedented time.  If we can answer questions or help you in anyway, especially with any relief fund applications, please do not hesitate to get in touch.