Since the start of the pandemic, we’ve been trying to keep up with the onslaught of responses and resources being mobilized to address the COVID-19 impacts on our local businesses, their employees and the community.
This is why the Business For Good San Diego board of directors is currently prioritizing our members’ well-being in response to COVID-19 above all other policy areas in our mission.
The legislative relief coming from the U.S. Congress, state legislature, and local municipalities are encouraging and bipartisan. While we are very glad to see a consensus to support small businesses, what is being proposed falls short in finding its way to you and matching the level of needs that we’ve heard from you.
In response, Business For Good is urging the following to prevent disastrous economic damage to our local businesses that employ nearly 60% of San Diego County residents:
1. Ensure you’re being heard
We are concerned that the responses we’ve seen so far show an alarming lack of outreach and participation from businesses like ours. We are asking our elected officials to guarantee a strong representation of small businesses to make sure whatever relief is proposed in their policy responses are suited to our needs.
Without that voice, the resulting support programs offered to small businesses will not be inclusive in their design: that is, whatever gets created will run the risk of only being accessible to larger-capacity companies, and applicable to just a few sectors.
2. Do not force more debt as the only option: innovate
Almost every response being proposed right now is built on existing programs and support vehicles which have always struggled to reach small businesses. The current speed at which this recession is moving requires new thinking, not just tinkering a broken machine. This is a time to innovate and test new ideas. After all, our small businesses are all modeling for you what innovation in times of need looks like as we adjust to these times. Our public systems have the opportunity to lead by example as well.
For example, the responses we have heard so far assume businesses are in a position to take on debt, but most of us aren’t sure when our revenues will recover to start making payments. Our answer is simple: help us keep caring for our employees in the face of uncertainty.
If loans are being offered, let’s at least ensure they include deferral and extension-of-term options. Examples of better responses we recommend include grants (not loans) and suspension of costly line items such as rent, utilities, credit payments or payroll taxes.
3. Adaption, urgency and exigency
Every solution must prioritize responsiveness – simply put, speedy applications and responses, which require easing the due diligence hoops businesses must jump through.
We have had to change our operations overnight in this new reality. Our teams are vulnerable and we can’t conscionably wait three weeks, as some of the largest programs are estimating, to find out how we can afford to care for them. Financial response times have to also acknowledge the immediate need for relief. Unfortunately, we find ourselves in a “do first, document second” moment of truth, as that kind of typical three-week turnaround is no longer a relief program; three weeks at this point is a rebuild program for the slightly-more-fortunate that already had access to capital.
Programs have to adapt to rapidly evolving economic conditions, as our outreach to fellow small business owners during these first few weeks underscores the need to provide relief for businesses being hit at different times:
First to the businesses affected right now with the first wave of mandatory restrictions and closures (hospitality and non-essential services)
Then to businesses whose losses are likely going to be felt in the next few months as the new economic conditions are better understood
4. Appropriate investment levels
The best analogy that captures the current responses is that, while well-intentioned, the economic stimulus proposals are putting a bandage on a cut when we’re having a heart attack. If every elected official indeed believes that our economic engine depends on a healthy small business community, then this is the time to prove it.
This means re-thinking how much is enough and believing without a doubt that any pay-it-forward investment in our businesses today pays itself in multiples in the years following.