Chamber Discusses Resources For Small Businesses In San Diego

Speaker 1: 00:00 Businesses deemed essential like gas stations and restaurant takeout are doing their best to stay afloat during the coronavirus shutdown. But most of San Diego small businesses are completely closed with employees out of work and owners struggling to figure out if their businesses will be able to make it through this crisis. Federal state and local programs are now in place to help small businesses recover. But will it be enough? Joining me is Stephanie Benvenuto, she's vice president of public affairs at the San Diego chamber of commerce. Stephanie, welcome to the program. Speaker 2: 00:32 Thank you so much for having me. It's a pleasure to be here. Speaker 1: 00:35 What are the biggest concerns you're hearing from small business owners? Speaker 2: 00:39 Uh, overwhelmingly the question from business owners is access to capital and the process by which they access that capital. So a lot of what's happened, um, as employers are shutting down, they're shutting down as a result of government directive, not as a result of imprudent decision making on their part. So you know, you could have done everything by the book and followed all the rules and really been a model, a small business, and still be blindsided by the reality of today. So many of them are learning on the fly about disaster preparedness for their business and, and what sort of programs and products exist out there or a business who no longer has an income, again, by no fault of your own. So we have seen a variety of programs come online, which you mentioned earlier. It's a matter of education for, for a great many of them and getting them, getting them the application and the tools and all of the documentation that they need to make themselves eligible to participate in those programs. Speaker 1: 01:41 Now most small businesses operate on a pretty tight cashflow in the best of times, isn't that right? Speaker 2: 01:47 Yes, that's very true. We always say that any regulation, any change you pass will impact businesses. But anything that impacts business will impact the small business much harder than the medium and large. Speaker 1: 01:58 So how much reserves would you say they do have just on their own? Speaker 2: 02:02 The San Diego landscape for small business is not one that I think lends itself well to a typical business. And I had an idea, an idea of what they have in their reserves, but I can tell you that some immediately knew that furlough was in their future when they saw the government shutdown regs coming out. And then there was others that had, you know, a week or two weeks or the most common story I heard, and I don't want to say it's typical, but I'll say it was the most common, was that businesses had, you know, one round of payroll in them before they ran through their reserves. Speaker 1: 02:40 Now there are a number of lifelines being thrown to small businesses in the form of government loans and grants. Can you outline the program or programs you think will be most helpful? Speaker 2: 02:52 The cares program, which was the most recent federal stimulus bill brought with it, a member of loan products, some of which are actually forgivable too for the small business administration that many businesses have have shown a lot of interest in mainly the paycheck protection program. And then the E IDLs, uh, are also going to be really, really critical for folks who are trying to find their way through. We also saw a tax credit program a lot for folks who are able to keep their employees on their payroll and the time being, so then you could get 50% of that salary back, um, as a tax credit once again, once we reopened. And the number of these programs also that are coming for the small business administration. Uh, and you know, typical small business administration, the lenders, so banks that many organizations already have a relationship with, which is great. Speaker 2: 03:46 One of the things that's changed in how we've rolled out these programs is some of the regulations and requirements that used to be kind of tacked onto them, have them loosened or otherwise taken off the table. So the need for extensive collateral and other ability to get credit, um, we're making it easier for folks to access those funds. Granted, I, I have heard that some are easier than others to get to. We are still learning quite a bit. The paycheck protection program applications just went live. I believe late last week, I think on Friday. And we're still learning about the right way, the best way, most effective and productive way to get those applications approved. So, um, I would really recommend folks take a look at the care's act program. The U S chamber of commerce, small business administration and the S small business development centers all are incredible resources with lots of good guidelines because no small businesses the same and all of these programs are different and that all require their own sort of approach and application. Speaker 2: 04:46 No. You mentioned E I D ELLs, what are they? It's an economic injury disaster loan, which existed before Corona virus. So it was a caveat program for businesses who were going into it, things that you typically can't foresee, but it did give folks access to a small business loan program that was different from the typical sort of startup or an need for capital. It's really no extenuating circumstances and things along those lines. So when we first started to see the Corona virus impact our local economic landscape, that was one of the products that we, we were just pushing people toward as quickly as possible. What about the city of San Diego small business relief fund? Where does that fit into the relief effort? The city's program? City specific, narrower scope but still really important because some of the programs we talked about before that were affiliated with the cares act at the federal level require an existing relationship with a bank. So we know that not every business in San Diego has that. Some folks aren't affiliated with an institution, which makes it very hard to access those funds. It could prolong the timeline. These city programs provide some variants in accessibility that make it possible for those businesses that otherwise, you know, maybe you're a startup brand new, maybe a refugee owned business and you don't have those traditional relationships. Having things like what the city has done so proactively is really important to making sure that everybody has a, has a shot at that capital. Speaker 1: 06:17 Now, all of these programs that small businesses are applying for that we've been discussing, they take time to get approved, especially since the application volume is, as you say, so high right now. What advice do you have to those businesses who have applied and are waiting to hear back? Speaker 2: 06:32 Oh gosh. Um, I want folks to know that people really are sympathetic with the fact that that is one of the biggest deterrents that we understand that the business community needs help now. And I think that's that we've all been keeping, um, at the front of our minds, one of the programs within the cares act does actually allow for a $10,000 advance, I believe, to be deposited within, you know, 72 hours or something incredibly expeditious. So there are ways to access some funds quicker. Again, if you meet those requirements and you have that existing relationship and you're working with a bank and you've been really proactive. I also think that if you're a business in a position where you may be on the cusp of survival still and you have not reached out to your lender or your existing banking institution, you should really be doing that. Proactive discussions with them is really important because as different products come online or as your situation changes, it does take some time to get those conversations moving. So if you are already in the queue, if you've expressed interest, that will help to minimize some of the time in that turnaround. Unfortunately there's no, no secret door, no, you know, quick access pass. But the faster and more uh, communicative you've been to respond to the possible need, even if that need is not urgent quite yet, we'll probably situate you better in the long run. Speaker 1: 08:01 Couple of last questions. Uh, Stephanie, are there any types of small businesses in San Diego that you are particularly concerned about and is it inevitable that a number of businesses will not be able to reopen? Speaker 2: 08:15 I think, uh, our survey that we recently completed told us that our, um, members that are within the food beverage and tourism is probably frontline folks who are feeling like this, this situation disproportionately. Um, and that it's a very sobering bit of information to look for the survey responses there. Uh, 80% of the employers that we're printing on reducing staff were represented by or were representative of those industries. So I think any programs that we are looking at as far as recovery have to think about those and their interconnectedness with the larger economic landscape in San Diego. Uh, with regard to reopening, I think it is quite possible that following the Corona virus, um, situation and when we start to see our, our economy come back to life, it will look different. And what exactly that will be specifically. I don't, I don't think that we're prepared to speak to, I think the timeline is going to be very critical and watching what the state decides to do, um, continue to do will definitely matter. So fingers crossed that everybody can continue to hang on and that we can continue to see a larger strategy so that businesses can plan to the best of their abilities. That I, I, I don't know that we're at a, at a position yet where we can make those productions. Speaker 1: 09:40 I've been speaking with Stephanie Benvenuto, she's vice president of public affairs for the San Diego chamber of commerce. Stephanie, thank you very much. Thank you.