JEDE Weekly COVID-19 Update - March 2, 2021, Edition
MAJOR ANNOUNCEMENTS
California COVID-19 Update: Below is the most current CalOES status update. www.covid19.ca.gov
Insurance Diversity Task Force: Insurance Commissioner Lara announced appointment of a new chair and member of the Insurance Diversity Task Force. http://www.insurance.ca.gov/diversity/Index.cfm Mark Morales was appointed as Chair and will be the first LGBTQ+ person to lead the Diversity Task Force (http://www.insurance.ca.gov/0400-news/0100-press-releases/2021/release016-2021.cfm) and Dr. Fabiola Cobarrubias was appointed as a new member of the Insurance Diversity Task Force (http://www.insurance.ca.gov/0400-news/0100-press-releases/2021/release020-2021.cfm). “According to the latest California Insurance Diversity Survey data collected by the Department of Insurance – comprising the boards of over 250 insurance companies – diversity in the boardroom remains a critical issue. In 2019, board seats continue to be disproportionately represented by men, with an overwhelming 70% of seats occupied by men and only 15% of board seats occupied by directors from historically underrepresented communities. Meanwhile, fewer than 1% of board directors identified as LGBTQ+.” The first quarterly meeting of the Insurance Diversity Task Force is scheduled for Thursday, March 11, 2021.
Federal Stimulus Bill Passes House: The US House of the Representatives passed a $1.9 billion COVID-19 stimulus package on Saturday (2/27/21), with all but one Democrat voting yes, and every Republican voted no. Congress plans to pass a final bill by March 14, the day the current extended federal unemployment insurance benefits end. Key aspects of H.R. 1319 – American Rescue Plan Act of 2021 include:
$1,400 stimulus checks for individuals making up to $75,000 and $2,800 for couples making up to $150,000, plus $1,400 for each dependent. This funding, added to the $600 approved in December 2020, constitute the $2,000 Economic Recovery Payments President Biden proposed in the American Rescue Plan.
Extending Unemployment Insurance and Pandemic Unemployment Assistance benefits from 50 weeks to 74 weeks (March 14 to August 29, 2021).
Expansion of the federal Earned Income Tax Credit, including certain elderly and childless adults.
Increase in qualified family leave wages under the Paid Family Leave Tax Credit from $10,000 to $12,000.
$350 billion for grants to states, territories, tribal governments, cities, and counties.
$14.9 billion for the Child Care and Development Block Grant
$25 billion for the Restaurant Revitalization Fund to support restaurants that have experienced a revenue loss due to COVID-19, including: a food stand, food truck, food cart, caterer, saloon, inn, tavern, bar, lounge, brewpub, tasting room, taproom, licensed facility or premise of a beverage alcohol producer where the public may taste, sample, or purchase products, or other similar place of business in which the public or patrons assemble for the primary purpose of being served food or drink
$15 billion for a targeted cash advance under the SBA Economic Injury Disaster Loan Program.
$10 billion and reauthorization of the State Small Business Credit Initiative Act of 2010
Includes a separate allocations for tribal governments and business enterprises owned and controlled by socially and economically disadvantaged individuals.
Requires states to provide a plan detailing how minority depository institutions and community development financial institutions will be encouraged to participate in state programs.
Provide funds to states to carry out a technical assistance plan under which a state will provide legal, accounting, and financial advisory services, either directly or contracted with legal, accounting, and financial advisory firms, with priority given to business enterprises owned and controlled by socially and economically disadvantaged individuals, as well as to very small businesses
$7.25 billion for the Paycheck Protection Plan, plus changes to the definition on nonprofit, second draw loans, forgiveness,
$3 billion Economic Development Administration
$1.2 billion for Shuttered Venue Operators, including $500,000 for technical assistance.
$175 million for the Community Navigator Pilot Program which funds community navigator services provided through nonprofits, which includes the outreach, education, and technical assistance provided by community navigators that target eligible businesses to increase awareness of, and participation in, programs of the Small Business Administration.
Raises the federal minimum wage to $15.00 an hour, beginning 4 years after the effective date of the bill. Current federal minimum wage is $7.25. The first scheduled increase under the bill is $9.50 an hour.
Small Business Hearing: The Assembly Committee on Jobs, Economic Development, and the Economy, Chaired by Assemblymember Sabrina Cervantes, held an informational hearing, “The Impact of COVID-19 on Small Businesses.” https://www.assembly.ca.gov/media/assembly-jobs-economic-development-economy-committee-20210223/video Key witnesses included the Dee Dee Myers, Senior Advisor to the Governor and Director of the Governor’s Office of the Business and Economic Development.
$2 billion tax cut by conforming CA tax law to new federal tax treatment for loans provided through the Paycheck Protection Plan and EIDL, which allows borrowers to deduct up to $150,000 in expenses covered by those loans.
$116 million in fee cuts by waiving various fees for two years for heavily impacted service industries, including 59,000 restaurants and bars licensed through ABC and to the more than 600,000 barbering and cosmetology individuals and businesses licensed through the Department of Consumer Affairs.
$400 million in new federal funds that will provide stipends of $525 per enrolled child for all state-subsidized childcare and preschool providers.
Extends care for children of essential workers through June of 2022, and funds increased access to subsidized childcare for more than 8,000 children of essential workers and at-risk children – who are not currently served in the system – through June of 2022.
$2.3 billion to provide a one-time $600 grant to households receiving the California EITC for 2020
$470 million to provide an additional one-time $600 payment for individuals with Individual Tax Identification Numbers (ITINs), which were not able to receive pervious federal economic impact grants.
$243 million to provide an additional $600 grant for families enrolled in CalWORKs.
$240 million to expand eligibility for CalWORKs by exempting the supplemental federal Unemployment Insurance benefits from income calculations.
$750 million to provide an additional $600 grant for individuals enrolled in Supplemental Security Income (SSI) or Cash Assistance Program for Immigrants (CAPI).
$24 million for financial assistance and services through Housing for the Harvest – a program providing support for agricultural workers who have to quarantine due to COVID-19.
$35 million for food banks and diapers.
$100 million for emergency financial aid for qualifying low-income students.
Restores previously enacted reductions, effective July 1st, for the UC, CSU, the Judicial Branch, Child Support Services and for moderate-income housing.
Small Business for America’s Future: Small Business for America’s Future conducted a national survey of 1,241 small business owners to learn how the pandemic was impacting their business and their opinions about government priorities and the proposed American Rescue Plan. https://investinamericanow.com/wp-content/uploads/sites/95/SBAF-Feb-Covid-Survey.pptx.pdf According to the survey, 69% of small business owners support the American Rescue Plan and, in general, the survey found that small business owners want Congress to prioritize economic relief over deficit reduction.
#LetsTalkBusiness Roundtable: National Women’s Business Council released a report, 2020 #LetsTalkBusiness Roundtable Series Report. https://cdn.www.nwbc.gov/wp-content/uploads/2021/02/03200805/FY2020-Roundtable-Report-NWBC_Final.pdf The report is a series of testimonials from women entrepreneurs on current challenges and opportunities associated with access to capital, childcare, and patenting and trademark. Information from this report will be used by the SBA, White House, and the US Congress in setting 2021 priorities. Several recommendations are listed below.
Women business owners are driving economic recovery post-natural disasters.
Lack of financial literacy continues to impede women’s entrepreneurial potential.
Micro-lending is a critical capital access option for women-owned startups.
Lack of available, affordable childcare encumbers the workforce and pandemic recovery.
Childcare providers must be recognized as small businesses in future federal stimulus aid.
Childcare providers struggle for profitability against onerous regulations and high operational costs.
Women business owners reject traditional STEM industry labels and pipelines.
Female innovators are often also caregivers with scarce time to grow an enterprise.
Access to capital is a persistent barrier faced by women to patent or trademark innovations.
High legal costs and complex patenting processes are top challenges for women to commercialize given the unique and common barriers to accessing capital.
California Budget Update – Highlight on the LAO
LAO Analysis on UI Loan: The California Legislative Analyst’s Office released its evaluation of the Governor’s 2021-22 Budget Proposal on the $555 million General Fund interest payment on the federal Unemployment Insurance loan. https://lao.ca.gov/reports/2021/4360/Interest-Payment-Federal-UI-Loan-021021.pdf These funds would constitute the first annual interest payment on federal UI trust fund loans and corresponds to the full interest payment, not the 25% that would be due under an interest payment deferral. The estimated interest payment is due September 30, 2021. The report includes a full discussion of the options and requirements. The LAO recommends:
Adopt Updated $260 Million Estimate of Federal Interest Payment Due. We recommend the Legislature adopt an up-to-date estimate of the overall interest amount likely due in September. For planning purposes, we suggest the Legislature adopt our estimate of $260 million. This estimate reflects current economic conditions and federal law. If the federal government takes further action to extend the interest waiver beyond March 14, this estimate would need to be revisited and likely reduced accordingly. Mindful of this shifting landscape, the administration and our office will provide an updated estimate as part of the May Revision.
Defer Interest Until Later Years. In addition to adopting an up-to-date estimate of the total interest payment, we recommend the Legislature adopt provisional budget legislation to request an interest payment deferral from the U.S. Department of Labor, given that the deferral does not have the effect of increasing state payments. This would allow the state to pay one-quarter of this year’s interest payment in 2021-22 and an additional one-quarter in each of the next three years. Should the Legislature pursue this course, we estimate that the total interest due this year would be roughly $65 million.
LAO Analysis on Evaluating State Economic Stimulus Proposals: The California Legislative Analyst’s Office released a framework for evaluating state economic stimulus proposals. https://lao.ca.gov/reports/2021/4331/Economic-Stimulus-Proposals-020121.pdf Key elements of the evaluation framework are described by the LAO as follows:
Recognize Limitations on State Funded Stimulus: Unlike the federal government, which can run a deficit to pay for fiscal stimulus, the state must balance fiscal stimulus with other one-time and ongoing spending priorities.
Ask Key Questions to Assess Stimulus Proposals:
What is the source of funding?
Does the proposal have other strong policy justifications?
How does the proposal interact with other federal, state, and local programs?
How might the expected benefits and costs be overstated or understated?
Will the benefits be realized when they are needed? How might the benefits be distributed?
Based on the Answers to these Questions, Incorporate These Elements for More Effective Stimulus
Given the state’s spending constraints, economic stimulus is most likely to be effective if new programs:
Are funded using federal funds, a state General Fund surplus, or proceeds from previously authorized bonds.
Efficiently advance other legislative policy objectives.
Complement (and do not duplicate) other federal or state programs.
Can be implemented quickly.
Are well designed and clearly targeted.
Avoid making existing inequities worse.
LAO Assessment of Community College Proposed Budget: The California Legislative Analyst’s Office released its analysis of the Governor’s Proposed 2021-22 Budget for the California Community Colleges. https://lao.ca.gov/Publications/Detail/4372 Key finding as stated by the LAO:
Opportunities Exist to Be More Strategic With Ongoing Spending Commitments. We believe the Legislature has opportunities to improve the Governor’s overall community college budget package by taking fewer, but more strategic, actions. As regards to ongoing spending, we encourage the Legislature to consider increasing the proposed 1.5 percent cost-of-living adjustment for apportionments by redirecting funds from lower-priority proposals. (In this report, we identify some ongoing spending proposals that we believe are good candidates for such a redirection.) Offering a larger increase to apportionments would help colleges in responding to staffing, salary, and benefit pressures while also giving them flexibility in responding to key local needs.
Also Opportunities to Be More Strategic With One-Time Initiatives. As with the ongoing proposals, we think the Legislature might want to consider redirecting funds from some one-time initiatives to a more select set of strategic one-time priorities. Specifically, the Legislature could consider redirecting resources from lower-priority one-time proposals to paying down more deferrals and/or mitigating districts’ future pension cost increases. Throughout this report, we identify several unjustified or otherwise lower-priority one-time initiatives that we believe are good candidates for this type of redirection.
Enrollment Demand in 2021-22 Likely Depends on Several Factors. The Governor’s budget includes $23 million for 0.5 percent enrollment growth. At this point in time, it is unclear whether fall 2021 instruction will be primarily virtual, primarily in-person, or a hybrid model. On the one hand, if colleges—and K-12 schools—reopen in the fall and the economy is slow to recover for displaced workers, CCC enrollment demand could be strong. If colleges remain primarily online in the fall and children must continue to attend school virtually, CCC enrollment demand could remain weak. By spring 2021, the Chancellor’s Office plans to provide the Legislature with final 2019-20 enrollment data and initial 2020-21 enrollment data. By spring, more school and CCC districts also likely will have announced their fall instructional plans. This information, in turn, will help the Legislature assess whether the Governor’s proposed 0.5 percent enrollment growth expectation for the CCC system in 2021-22 is reasonable.
Student Support Proposals Could Be Better Coordinated. The Governor has three proposals relating to student food and housing insecurity, mental health, technology access, and emergency financial aid. This package of proposals would continue the state’s piecemeal approach to addressing students’ basic needs. We recommend the Legislature consider an alternative approach—creating a basic needs block grant that provides local flexibility as well as state-level accountability. We also recommend the Legislature coordinate any state funding for emergency financial aid with federal relief funds that have been provided for the same purpose.
LAO Assessment of the Proposal to create a New Department of Better Jobs and Higher Wages: The California Legislative Analyst’s Office released its analysis of the Governor’s Proposed 2021-22 Budget for the new Department of Better Jobs and Higher Wages. https://lao.ca.gov/reports/2021/4361/Dept-Better-Jobs-021021.pdf Key findings as stated by the LAO:
Labor Agency Serves Similar Functions as Proposed New Department. According to the administration’s budget change proposal for the new department, released last year, consolidating the entities will (1) improve equity for all workforce participants, (2) provide efficiency by bringing the programs together, and (3) enhance customer service for workers and employers. However, each of these entities resides currently within the Labor and Workforce Development Agency (LWDA). The LWDA was created in 2002 to (1) improve accountability and access to services, (2) eliminate program duplication, and (3) achieve cost-effectiveness. Achieving the objectives identified for the new department appears well within the original and ongoing responsibilities of the LWDA.
Not Clear What Problem the Reorganization Is Intended to Solve. To the extent that problems exist within the current structure that prevent LWDA entities from aligning resources, decision-making, and policy, we are unsure how creating a new department addresses these problems. Without a clear problem definition, the Legislature may find it difficult to judge the proposal or establish accountability and expectations for the new department.
Reorganizing EDD During Unemployment Insurance Challenges Poses Risks. To create the new department, the administration proposes to shift about 1,600 staff from EDD to the new department. These staff currently work within EDD’s workforce services branch and therefore are not responsible for the day-to-day administration of the state’s unemployment insurance program. Nevertheless, a reorganization presents logistical and personnel challenges that call for considerable focus from EDD and Labor Agency leadership at a time when the state’s urgent goal is to eliminate the backlog of unemployment insurance claims and prevent further fraud. In our view, the administration’s decision to move forward with a complex reorganization during the pandemic poses a potentially serious risk to the state’s ongoing efforts to eliminate the backlog of unemployment insurance claims.
GOOD NEWS ABOUT JEDE FRIENDS
Silvia Paz: Governor Newsom appointed Silvia Paz, of Thermal, to the Blue Ribbon Commission on Lithium Extraction in California. Paz has been Executive Director and Founder at Alianza Coachella Valley since 2019. She was Director at Building Healthy Communities Eastern Coachella Valley from 2013 to 2019. Paz was District Policy Director in the Office of Assemblymember V. Manuel Perez from 2010 to 2013. She was Project Coordinator at the Harvard University Planning Office from 2008 to 2009. Paz was a Teacher at the Coachella Valley Unified School District from 2005 to 2007 and from 2009 to 2010. She is a Trustee at Coachella Valley Unified School District; Co-Chair at Salton Sea Management Plan Engagement Committee; and Director of Desert Recreation District. Paz earned a Master of Public Policy degree in economic development and transportation from Harvard University.
DATA, SURVEYS, AND ANALYSES
January US Employment Data (most current): US Bureau of Labor Statistics (BLS) released national-level employment data for January 2020. https://www.bls.gov/news.release/empsit.nr0.htm According to the report, total US nonfarm payroll employment increased by 49,000 jobs in January, reflecting a 6.3% unemployment rate. In releasing the data, the BLS stated: “In January, notable job gains in professional and business services and in both public and private education were offset by losses in leisure and hospitality, in retail trade, in health care, and in transportation and warehousing.” Unemployment among selected worker groups: 14.8% for Teenagers, 9.2% for Blacks, 8.6% for Hispanics, 6.6% for Asians, 5.7% for Whites.
December California Employment Data (most recent): The Employment Development Department released state-level data for December 2020. https://www.edd.ca.gov/newsroom/unemployment-december2-2020.htm California’s unemployment rate was 9.0% in December. Nonfarm payrolls contracted by -52,200 jobs. According to the announcement, California has regained more than 44% of the 2,615,800 nonfarm jobs that were lost due to the COVID-19 pandemic in March and April. Unemployment among Blacks and Latinx were up from the 11% of the prior month, 12.2% and 11.7% respectively. https://www.labormarketinfo.edd.ca.gov/Publications/Labor-Market-Analysis/calmr.pdf
The number of people who were self-employed and working was down -20% in April 2020 as compared to April 2019. The end of the year, rate was down -3.6%.
The number of people in metropolitan areas who were working and self-employed was down -21% in April 2020 as compared than in April 2019. The end of the year, rate was down -5.6%.
Leisure and hospitality had the largest decrease in employment (-48%), and had the third largest small business share (61%).
Self-employment in April 2020 was down significantly from April 2019 among women (-22.1%) and people of color, including Blacks (-37.6%, Asians (-37.1%), and Hispanics (-26.0%).
Small Business Survey: Bianca Blomquist with Small Business Majority announced the release of their current survey of California small business owners, Scientific Opinion Poll California small businesses struggling to access capital, need more help to ensure financial recovery. https://ajed.assembly.ca.gov/sites/ajed.assembly.ca.gov/files/CA%20A2C%20Poll%20-%20February%202021.pdf Among other things, the survey found:
When seeking capital, small business owners of color (32%) encountered more setbacks than their white counterparts (18%). More specifically, while 25% of business owners overall have been denied a loan, 32% of business owners of color have been denied as compared to 17% of whites.
Four in 10 small business owners report they will need no-cost grants or zero interest loans this year to keep their business open, and nearly half of entrepreneurs of color report this (48%). In general, 82% of small business respondents said they support providing small businesses grants.
Many small businesses are behind on loan or other debt payments, with 28% saying they have missed a loan or other debt payment during the pandemic, and 25% are currently behind on business loans or other debt payments. Entrepreneurs of color are more likely to be struggling, with 37% having missed their payments and 32% are behind on payments.
Small business owners struggled with federal loan programs intended to help them weather the crisis. Nearly 2 in 3 (64%) who applied for PPP last year found it challenging to apply. Those who didn’t apply largely attributed their reasons to thinking or being told they were ineligible (28%), fear over taking on debt (27%), concern that the loan wouldn’t be forgiven (11%) and inability to find a bank to accept their application (6%).
Entrepreneurs of color were three times as likely (9%) as white business owners overall (3%) to have obtained a high interest loan that they could not pay back.
Twenty-seven percent of small businesses overall and 39% of business owners of color have obtained financing other than from PPP or EIDL. Entrepreneurs of color were more likely to have obtained financing from their own retirement savings (33%), a grant program (26%), an online lender (21%), or a nonprofit lender (19%).
January Real Earning Summary: The US Bureau of Labor Statistics released a national-level real wage summary for monthly or annual real earning changes. https://www.bls.gov/news.release/realer.nr0.htm The data shows real average hourly earnings for all employees were unchanged from December 2020 to January 2021 (seasonally adjusted). Real average weekly earnings increased 0.8% over the month due to the unchanged real average hourly earnings being combined with an increase of 0.9% in the average workweek. Real average hourly earnings increased 4.0% (seasonally adjusted) year over. The change in real average hourly earnings combined with an increase of 2.0% in the average workweek resulted in a 6.1% increase in real average weekly earnings over this period.
February Work Stoppage in the US: US Bureau of Labor Statistics released a national-level work stoppage summary covering all work stoppages in 2020. https://www.bls.gov/news.release/wkstp.nr0.htm The data shows that there were 8 major work stoppages in 2020. A major work stoppage involves 1,000 or more workers and lasts at least one shift during the work week. This year had the third lowest number of major work stoppages since the series began in 1947. The lowest annual total was 5 in 2009, followed by 7 in 2017. For the past 20 years, on average, there have been 16 work stoppages beginning in the year.
February People with a Disability in the Work Force: US Bureau of Labor Statistics released a national-level summary for how people with disabilities are faring in 2020. https://www.bls.gov/news.release/disabl.nr0.htm The data shows 17.9% of persons with a disability were employed, down from 19.3% in 2019. For persons without a disability, 61.8% were employed in 2020, down from 66.3% from the prior year. The unemployment rates for persons with and without a disability both increased from 2019 to 2020, to 12.6% and 7.9%, respectively.
January Industrial Production and Capacity Utilization: The Federal Reserve Bank released a national-level summary for how major market groups and major industry groups are faring in 2021. https://www.federalreserve.gov/releases/g17/Current/default.htm The dataset shows, in month-over changes through January 2021, that industrial production increased 0.9%. Manufacturing output rose 1.0%, and mining production advanced 2.3%; while the output of utilities declined 1.2%. At 107.2% of its 2012 average, total industrial production in January was 1.8% lower than its year-earlier level. Capacity utilization for the industrial sector increased 0.7% in January to 75.6%, a rate that is 4.0% below its long-run (1972–2020) average. Most market groups posted gains in January, with noteworthy declines coming for consumer paper products, paper materials, transit equipment, information processing equipment, and consumer energy products. Total industrial production has not returned to its pre-pandemic levels of early last year. In January, the indexes for about half of the market groups were still below their year-earlier readings; notably, weakness in the oil patch during most of last year has left the production of energy levels 6.2% below its level 12 months earlier.
January Personal Income and Outlays: The Bureau of Economic Analysis released a national-level summary for how Personal Income and Outlays have been changed up until January 2021. https://www.bea.gov/news/2021/personal-income-and-outlays-january-2021 The dataset shows that in January, through month-over changes, personal income increased $1,954.7 billion (10.0 percent), disposable personal income (DPI) increased $1,963.2 billion (11.4 percent), and personal consumption expenditures (PCE) increased $340.9 billion (2.4 percent). The increase in personal income in January was more than accounted for by an increase in government social benefits to persons, as payments were made to individuals from federal COVID-19 pandemic response programs. The increase in “other” benefits primarily reflected economic impact payments distributed through the CRRSA Act. Unemployment insurance also increased, reflecting an increase in pandemic unemployment compensation, including supplemental weekly payments to unemployment beneficiaries re-introduced by the CRRSA Act.
Federal Grant Funding to the State of California: The Governor’s Office of Planning and Research released its annual report, Summary of Federal Grant Funding to the State of California. https://opr.ca.gov/docs/20210201-2020_Summary_of_Federal_Grant_Funding.pdf According to the announcement, the report describes “the over $87 billion in federal grants awarded in Federal Fiscal Year 2019 to California state agencies, tribes, local governments, nonprofits, higher education, and others.”
Data received from Great Plates Data Portal updated on Sundays.
GRANTS
Small Business Transition Grant For Early Career Scientists: The Department of Health and Human Services is in partnership with the National Institute of Health released a Funding Opportunity Announcement (FOA) to support early career academic scientists interested in transitioning to entrepreneurship while also supporting the transfer of technology from academic laboratories into small businesses. https://grants.nih.gov/grants/guide/rfa-files/RFA-CA-21-001.html This FOA seeks to support entrepreneurial mentoring and product development. The deadline to apply is March 24 at 5:00pm.
Adaptive Sports Grant Program: The National Veterans Sports Programs and Special Events Office of the US Department of Veteran Affairs is searching for a non-federal entity with significant experience in managing a large-scale adaptive sports program. https://www.grants.gov/web/grants/search-grants.html The Office will be providing up to 21 awards of $750,000. The mission of the Office is to provide opportunities for veterans to improve their independence, well-being, and quality of life through adaptive sports and therapeutic arts programs. The last day to apply is March 31 at 12:00 pm.
Contra Costa BlueGreen Alliance Foundation - $821,136
Building Skills Partnership - $600,000
California Long-Term Care Education Center - $1,069,660
California Mobility Center - $600,000
Kern Kern Community College District - $1,999,725
The LEAP Institute - $499,999
Proterra-USW Miguel Contreras Foundation - $646,345
Rising Sun Center for Opportunity - $600,000
Sierra Institute for Community and Environment - $1,000,000
San Luis Obispo County Office of Education - $600,000
Worker Education and Resource Center - $499,000
GUIDANCE ON PUA AND ECONOMIC IMPACT PAYMENTS
State Unemployment Benefit Data: The Employment Development Department (EDD) released new unemployment insurance data for California during the week ending February 20, 2021. https://www.edd.ca.gov/newsroom.htm Among other information, EDD reports the following:
27,640 initial Unemployment Insurance (UI) and Pandemic Unemployment Assistance (PAU) claims were filed during the report period.
Over 10.8 million initial unemployment benefit claims have been filed with EDD between March 14 and the close of the report period.
$124 billion has been paid to out-of-work Californians since the start of the pandemic.
Tracking UI Benefits: The California Employment Development Department (EDD) launched identity verification technology to help address the backlog of unprocessed unemployment benefit applications, including the Pandemic Unemployment Assistance. On February 19, 2021, EDD released its bi-weekly report to the Legislature addressing the backlog: https://www.edd.ca.gov/About_EDD/pdf/CUIC-337-legislative-report-021921.pdf Progress in eliminating the backlog are also tracked through these two data dashboards:
Unemployment Initial Claims Backlog Dashboard: As of February 24, 2021, 948, 737 individuals have been waiting more than 21 days for an initial payment or to be notified that they do not qualify for benefits.
Unemployment Continued Claims Backlog Dashboard: As of February 24, 2021, 182, 317 individuals received at least one payment and are now waiting more than 21 days for further processing of payment or disqualification in this week-by-week eligibility-based program.
Federal Pandemic Unemployment Compensation and Mixed Earner Unemployment Compensation: The US Department of Labor’s Employment and Training Administration issued new and updated guidance to states on the implementation of the unemployment insurance programs included contained in the Continued Assistance for Unemployed Workers Act of 2020, which is part of the Consolidated Appropriations Act, 2021:
Initial overarching guidance is issued to states regarding a range of unemployment insurance programs, including the Pandemic Unemployment Assistance (PUA) program, which provides UI benefits to individuals who are not generally eligible for traditional unemployment benefits, including gig workers. https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=3831
Updated guidance is released for the Federal Pandemic Unemployment Compensation (FPUC) and Mixed Earner Unemployment Compensation (MEUC) programs. https://www.dol.gov/newsroom/releases/eta/eta20210105 The initial FPUC program provided $600 a week in supplemental compensation and expired July 31, 2020. The FPUC reauthorization provides $300 per week beginning December 26, 2020, and ending March 14, 2021. According to the announcement, the FPUC is not payable during the gap in authorization, that is, weeks of unemployment ending after July 31, 2020, through weeks of unemployment ending on or before December 26, 2020. Guidance: https://wdr.doleta.gov/directives/corr_doc.cfm?docn=6122
Look for Economic Impact Payments in the Mail: The IRS began issuing the second round of EIPs through direct deposit on December 29, followed by the mailing of paper checks. According to the January 7 announcement, individuals who do not receive a direct deposit should watch their mail for either a paper check or a prepaid debit card. https://www.irs.gov/newsroom/treasury-issues-millions-of-second-economic-impact-payments-by-debit-card
STATUS REPORTS ON SMALL BUSINESS ACCESS TO CAPITAL
[This is a “quick-source” section that includes new and previously provided information.]
California Small Business Grants: The Office of the Small Business Advocate launched a Small Business COVID-19 Relief Grant program, which provided nearly $500 million in grants to small businesses and small nonprofits that have been negatively impacted by the COVID-19 pandemic. The Legislature approved and the Governor signed SB 87 (Caballero and Min) on February 23, 2021, which provide as additional $2.1 billion in grant funds through a minimum of three additional funding rounds.
Application and award notice period for Rounds 1 and 2 is completed. Over 354,000 applications were received in Rounds 1 and 2, requesting a total of $4.5 billion.
Preliminary data shows that 43,419 applicants received at least initial approval for a total of $495 million. 95% of the awardees were from small business applicants, as compared to applications from nonprofits. More information on small business applications is available at: https://ajed.assembly.ca.gov/content/small-business-covid-19-relief-grant.
Free one-on-one technical assistance is available through a wide range of nonprofit resource providers, including SBDCs, Women’s Business Centers, and ethnic chambers of commerce: www.CAReliefGrant.com.
Tax Credits for Required Paid Leave: The Internal Revenue Service (IRS) maintains a webpage on current information regarding tax credits employers may apply when meeting COVID-19 employee paid leave requirements. https://www.irs.gov/newsroom/covid-19-related-tax-credits-for-required-paid-leave-provided-by-small-and-midsize-businesses-faqs This includes, but is not limited to, the newly extended Employee Retention Credit. https://www.irs.gov/newsroom/covid-19-related-employee-retention-credits-how-to-claim-the-employee-retention-credit-faqs The Taxpayer Certainty and Disaster Tax Relief Act of 2020, enacted December 27, 2020, made a number of changes to the credits previously authorized under the CARES Act, including modifying and extending the Employee Retention Credit. Several of the changes apply only to 2021, while others apply to both 2020 and 2021. The maximum ERC amount available is $7,000 per employee per calendar quarter, for a total of $14,000 in 2021. Small employers may request advance payment.
Are You Eligible for A Tax Credit? The Internal Revenue Service released a new form to help eligible self-employed individuals determine their qualified sick and family leave credit under the Families First Coronavirus Response Act -- IRS Form 7202, Credits for Sick Leave and Family Leave for Certain Self-Employed Individuals: https://www.irs.gov/pub/irs-pdf/f7202.pdf
100% Corporate Donation Exemption: The Taxpayer Certainty and Disaster Tax Relief Act of 2020, enacted Dec. 27, 2021, temporarily increased the corporate contribution limit to 100% of a corporation’s taxable income for contributions paid in cash for relief efforts in qualified disaster areas. https://www.irs.gov/forms-pubs/about-publication-526 While donations related to COVID-19 are not eligible, other specified federally declared disaster are eligible, including certain fires.
Shuttered Venue Operators: The US Small Business Administration is launching the Shuttered Venue Operators (SVO) Grant program, as authorized by The Economic Aid to Hard-Hit Small Businesses, Non-Profits, and Venues Act. Under the new program, $15 billion is dedicated to making grants to shuttered venues who may receive up to 45% of their gross earned revenue, up to a $10 million. $2 billion of the grants are reserved for businesses with 50 or less employees.
SBA Weekly Lending Report on Race and Ethnicity of Clients: The US Small Business Administration’s most recent weekly lending report for its core SBA products is for the week ending February 19, 2021. Information includes race, ethnicity, gender, and veteran participation in the SBA 7(a), 504, and Advantage Loan Programs. https://www.sba.gov/document/report-2021-weekly-lending-reports
COVID-19 EIDL Updates: Applications are OPEN for the COVID-19 Economic Injury Disaster Loans. New funding was provided in the Consolidated Appropriation Act of 2021.
NEW – Cash Advance Look Back: The Small Business Administration announced that they would be contacting businesses who applied for Advances in 2020 that either received less than $10,000, or who received no Advance at all. Applicants in a low-income community who can demonstrate more than a 30% reduction in revenue during an 8-week period during the COVID-19 pandemic, may qualify for a Targeted EIDL Advance now. https://drive.google.com/file/d/1GzRfFuB-8bpIiegu6HvNfJa4MxIW8nAz/view
Aggregate-Level Data Update: The US Small Business Administration released program utilization information for the COVID-19 Economic Injury Disaster Loan (EIDL). As of February 25, over 3.7 million EIDL loans have been approved in the US for a total of $200 billion with 96% of those funds being disbursed. Small business in California received the largest amount of funds and largest amount of money through cash advances. https://www.sba.gov/sites/default/files/2021-03/2021.02.26%20-%20SBA%20COVID%20Relief%20Program%20Report%20-%20vFINALSHARE-508_0.pdf As of November 30, 2020, Californians had received 60,893 EIDL loans have been approved for a total of $34.5 billion
Small Business Disaster Loan Guarantee Program: The Small Business Finance Center at the California Infrastructure and Economic Development Bank administers a credit enhancement (loan guarantee) as a way to encourage traditional and mission-driven lenders to loan money to small businesses who have been impacted by a disaster. https://ibank.ca.gov/wp-content/uploads/2021/02/JLBC-1.29.2021-Website.pdf Below is the most recent program activity.
State Small Business Disaster Loan Guarantee Program (January 29, 2021)
Conditionally Approved
Loan Amount
Guarantee Amount
Amount Encumbered
Employees
Total
1178
$46,629,998
$44,130,482
$22,065,241
5986
The IBank provides the Joint Legislative Budget Committee an update monthly.
CURRENT GUIDANCE ON STATE COVID-19 AND RECOVERY ACTIONS
[This is a “quick-source” section that includes new and previously provided information.]
Blueprint for a Safer Economy: Businesses can check out the status of the reopening of their county through the Blueprint for a Safer Economy (https://covid19.ca.gov/safer-economy/). This is the state’s four tier reopening plan. Tier 1 (purple) has the most restrictions and Tier 4 (yellow) has the fewest.
Equity Metric Added to Blueprint for Re-Opening: The Blueprint for a Safer Economy was expanded on October 6, 2020, to include a health equity metric. This information will be used in combination with the county’s case rate and test positivity rates to determine a county's tier. https://www.cdph.ca.gov/Programs/CID/DCDC/Pages/COVID-19/CaliforniaHealthEquityMetric.aspx The purpose of this new metric reflects the disproportionate impact COVID-19 has had on certain population groups, including rates of hospitalizations and death.
Searchable Database of Workforce Guidelines: The California Labor and Workforce Agency developed and launched a searchable employer guideline portal for COVID-19 guidelines. https://saferatwork.covid19.ca.gov/employers/employer-portal/ This is a customizable search engine that includes state and local guidelines. https://www.labor.ca.gov/wp-content/uploads/sites/338/2021/02/COVID-Employer-Portal-Press-Release-LWDA.pdf “The portal, available in English and Spanish, pulls all COVID-19 guidance and requirements from trusted state, county and city sources, including from the State’s Blueprint for a Safer Economy. In addition, it provides information about employee benefits, paid sick leave and immediate steps to take in the event of a COVID-19 case at work. To ensure accurate information at all times, the portal will be updated with local and state guidance on an ongoing basis.”
Shop Safe Shop Local: GO-Biz is leading a campaign to remind Californians to shop local and help small businesses prepare for the business realities of COVID-19. The #ShopSafeShopLocal website highlights free / discounted resources to help small businesses get digital, find e-commerce tools, learn more about industry guidance, locate small business centers, and access PPE. https://business.ca.gov/shopsafeshoplocal/
Safely Making Web Platform: California manufacturers who produce PPE, including face masks and gloves, can advertise their wares on https://www.safelymakingca.org/. The website is a joint effort by the California Manufacturers and Technology Association (CMTA) and the State of California. A manufacturer does not have to be a member of CMTA to participate. To apply, manufacturers should complete this form. At his September 9, 2020, press conference, Governor Newsom announced that the web platform currently included 450 California manufacturers.
