California COVID-19 Update: Below is the most current CalOES status update. www.covid19.ca.gov
California Comeback Plan: Governor Newsom announced a $75 billion budget surplus, which will be combined with $26 billion the state will receive under the American Rescue Plan, for a $100 billion COVID-19 recovery plan. The Governor describes the California Comeback Plan as a set of comprehensive strategies and major investments to address four of the state’s most stubborn challenges.
First Challenge - Immediate Needs of Lower and Middle-income Californians: The Governor is proposing a $500 tax rebate for households with incomes up to $75,000 with an additional $600 for households with children. This is in addition to the $600 approved earlier in the year for low-income households. The Governor also proposed doubling the state’s rent relief program and adding a $2 billion appropriation for utility assistance. The Governor has also announced a $5.1 billion package supporting the state’s drought response and water infrastructure, improving the state’s resilience to climate change impacts. https://www.gov.ca.gov/2021/05/10/california-roars-back-governor-newsom-announces-largest-state-tax-rebate-in-american-history/
Second Challenge – Homelessness: Under the California Comeback Plan, the Governor is proposing to “functionally end family homelessness within five years through a new $3.5 billion investment in homelessness prevention, rental support and new housing opportunities for people at risk of homelessness.” This portion of plan includes $1.85 billion new housing for homeless families and $1.6 billion in rental support and homelessness prevention for families. Another $50 million is proposed for “targeted programs and grants to local governments, to move people out of unsafe, unhealthy encampments and into safer, more stable housing.” There is $1.5 billion proposed to help clean public spaces near highways and transform public spaces through arts and cultural projects. According to the announcement, the initiative is expected to create an estimated 15,000 jobs, including for people experiencing or exiting homelessness, at-risk youth, veterans and formerly incarcerated individuals. https://www.gov.ca.gov/2021/05/11/california-roars-back-governor-newsom-announces-historic-12-billion-package-to-confront-the-homelessness-crisis/
Third Challenge– Transforming Public Schools: Governor Newsom proposes $20 billion in additional investments in public schools. https://www.gov.ca.gov/wp-content/uploads/2021/05/TK-12-Education-Fact-Sheet.pdf These new investments are intended to “make the structural change necessary to reduce barriers while increasing opportunities across the board, including massive investments in K-12 public schools, creating universal Pre-K and college savings accounts for 3.7 million low-income children in public schools.”
Fourth Challenge – Small Business Recovery: Governor Newsom announces another $1.5 billion for the state’s Small Business Relief Grant program for a total of $4 billion. https://www.gov.ca.gov/2021/05/13/california-roars-back-governor-newsom-announces-the-largest-small-business-relief-program-in-the-nation/ This is in addition to $6.2 billion tax cut approved by the Legislature and signed by the Governor in April. According to the Governor, this is the largest for those businesses hit hardest by the pandemic, the largest state tax cut of its kind in history. Other small business proposals include:
Increasing the CalCompetes tax credit program to $360 million, and establishing a one-time $250 million grant program, to incentivize businesses to relocate to California.
$250 million investment in California’s ports to address revenue loss and bolster future economic activity.
$200 million to expand sales tax exclusions through the California Alternative Energy and Advanced Transportation Financing Authority (CAEATFA) to promote, grow and incentivize green manufacturing in California.
$147 million for the Main Street Small Business Tax Credit to assist small businesses that have hired and retained workers since the second quarter of 2020.
$95 million to jumpstart California’s tourism industry, one of the largest economic drivers in the state that was particularly impacted by the pandemic.
April US Employment Data (most current): US Bureau of Labor Statistics (BLS) released national-level employment data for April 2021. https://www.bls.gov/news.release/empsit.nr0.htm According to the report, total US nonfarm payroll employment increased by 266,000 jobs in April, reflecting a 6.1% unemployment rate. In releasing the data, the BLS stated: “notable job gains in leisure and hospitality, other services, and local government education were partially offset by employment declines in temporary help services and in couriers and messengers.” Unemployment among selected worker groups: 13.9% for Teenagers, 5.6% Adult Women, 6.1% Adult Men, 9.7% for Blacks, 7.9% for Hispanics, 5.7% for Asians, 5.3% for Whites.
March California Employment Data (most recent): The Employment Development Department released state-level data for March 2021. https://www.labormarketinfo.edd.ca.gov/Publications/Labor-Market-Analysis/calmr.pdf California’s seasonally adjusted unemployment rate was 8.3% in March. Nonfarm payrolls increased by 119,600 jobs from the prior month. The civilian labor force was down -39,700 workers from the prior month and -265,700 from the prior year. Total civilian employment was up 9,900 jobs from March 2021. Unemployment among Blacks and Latinx were reported as 13.9% and 12.5% respectively, based on a 12-month rolling average. April data is expected May 21, 2021.
The first half of 2020 saw firms lose over 15 million net jobs, which was equivalent to the previous 7 years of job gains for both small (<500 employees) and large firms. More recent BLS private-sector employment levels show that about 40 percent of the total loss was regained by February 2021.
The increase in small business loan share (loans $1 million or less) is being driven by commercial and industrial (C&I) loans. In the fourth quarter of 2020, outstanding C&I loans grew over 50% compared with the fourth quarter of 2019. The growth is related to the SBA’s Paycheck Protection Program (PPP).
The index shows a small recovery in the second half of 2020 after emerging from a trough in the first half of the year. The PPP brought some relief to small businesses hurt by the pandemic. Toward the end of the year lending leveled off, which may reflect a slowdown in PPP lending. Additionally, small business loan defaults rose in mid-2020 but are well below Great Recession peaks.
In the fourth quarter of 2020, nearly one-fourth of adults said that they were worse off financially compared to a year earlier, reflecting the economic fallout and distress resulting from the global COVID-19 pandemic.
Seventy-five percent of adults were either doing okay or living comfortably in November, which was unchanged from 2019 after having fluctuated through the year. However, not all groups have fared similarly through the pandemic, and persistent disparities in well-being across education and race remained.
Adults with at least a bachelor's degree were much more likely to report doing at least okay financially (89%) than those with less than a high school degree (45%). This gap increased to 44% in 2020 from 34% in 2019. In 2020, less than two-thirds of Black and Hispanic adults were doing at least okay financially, compared with 80% of White adults and 84% of Asian adults. The gap in financial well-being between White adults and Black and Hispanic adults has grown by 4% since 2017.
Cost of Economic and Racial Injustice in Postsecondary Education: The Center on Education and the Workforce released a report, The Cost of Economic and Racial Injustice in Postsecondary Education, by Anthony P. Carnevale, et al. https://1gyhoq479ufd3yna29x7ubjn-wpengine.netdna-ssl.com/wp-content/uploads/cew-the-cost-of-economic-and-racial-injustice.pdf StreetInsider, May 12, 2021, describes the report as follows: “Inequality in the US education system has high costs for society. … If the US committed to achieving more equal postsecondary educational attainment by income and race/ethnicity, with an initial investment of $3.97 trillion, our country could see annual public benefits of $956 billion, in addition to numerous nonmonetary benefits. … As a result of equalizing educational attainment by economic status and race/ethnicity, the share of adults with an associate's degree or higher would increase by 18% current levels. Among racial and ethnic groups, the number of people with an associate's degree or higher would increase by 12.9 million low-income White individuals; 10.2 million Latino individuals; 5.9 million Black individuals; 498,000 Asian individuals; 462,000 American Indian, Alaska Native, Native Hawaiian, and Pacific Islander (AIAN/NHPI) individuals; and 457,000 individuals of other races and ethnicities.”
Recycling and Exports: California Department of Resources Recycling and Recovery released its annual report, State of Disposal and Recycling for Calendar Year 2019. https://library.us13.list-manage.com/track/click?u=dacfa367c242711b7d6f73ca7&id=dd5f452e15&e=cfad2cccf3 According to the report, “[o]verall waste generation in California was estimated to be about 77.5 million tons in 2019. Of that total waste generation, 48.6 million tons went to disposal and disposal-related activities, including about 42.2 million tons sent to landfill…An estimated 28.9 million tons of waste were recycled or diverted in California in 2019, resulting in a statewide recycling rate of 37%, down from .. the peak of 50% in 2014. Seaborne export of recyclable materials accounted for about 14.4 million tons in 2019, a decrease of approximately one million tons from 2018. Despite the decrease, seaborne exports of recyclable materials were the largest destination for statewide recycling…Although California will not meet the 75% statewide recycling goal in 2020 as set out in Assembly Bill (AB) 341 (Chesbro, Chapter 476, Statutes of 2011), the state is preparing for the implementation of Senate Bill (SB) 1383 (Lara, Chapter 395, Statutes of 2016) which will rapidly increase the recycling of organic material and help California meet the 75% goal. Meeting the goal to reduce statewide disposal of organic waste by 75% by 2025 will reduce emissions of short-lived climate pollutants, greenhouse gas emissions that are more potent than carbon dioxide. Successful implementation of SB 1383 is a critical component of the state’s strategy to combat climate change and build healthy soils.”
Briefing on Broadband: California Research Bureau released a report, The Digital Divide: Broadband Infrastructure, Affordability, Devices, and Municipal Models. The report was prepared at the request of the Assembly Committee on Communications and Conveyance and is intended as a briefing for legislative staff on broadband. https://www.library.ca.gov/Content/pdf/crb/reports/Broadband_in_California_May_%202021.pdf According to the summary by the California Research Bureau, “COVID-19 has forced the world to rely more on internet services to work, attend school and socialize. Broadband services are available in most areas of California, however, for 76.7% of rural households the available service does not meet the standard for internet download speeds set by the Federal Communications Commission.” The report provides an overview of broadband infrastructure, affordability and devices in California, and the status of municipal broadband, among other information.
Data received from Great Plates Data Portal updated on Sundays.
GRANTS
Public Works and Economic Adjustment Assistance Programs: The US Economic Development Administration issued its FY 2020 Public Works and Economic Adjustment Assistance Programs notice. https://www.grants.gov/web/grants/view-opportunity.html?oppId=321695 These programs are intended to provide economically distressed communities and regions with comprehensive and flexible resources to address a wide variety of economic needs. Projects funded support work in Opportunity Zones, as well as projects that lead to the creation and retention of jobs and increased private investment, advancing innovation, enhancing the manufacturing capacities of regions, providing workforce development opportunities, and growing ecosystems that attract foreign direct investment. Grants and cooperative agreements made under these programs are designed to leverage existing regional assets and support the implementation of economic development strategies that advance new ideas and creative approaches to advance economic prosperity in distressed communities, including those negatively impacted by changes to the coal economy. Applications will be accepted on an ongoing basis.
Build to Scale (B2S) Program: The US Economic Development Administration issued its FY21 Build to Scale (B2S) Program notice making $38 million in federal funds available to build regional economies through scalable startups. Under the FY21 B2S program, EDA is soliciting applications for two separate competitions through its Venture Challenge and Capital Challenge. The Venture Challenge seeks to support entrepreneurship and accelerate scalable companies’ growth in communities that are challenging the status quo of markets, commercializing technology, and furthering job creation. The Capital Challenge seeks to increase access to capital in communities, sectors, or regions where risk capital is in short supply. This includes accelerators, educational institutions, angel networks, and investment funds (B2S does not directly fund individuals or individual startups). For full program details, please visit www.eda.gov/oie/buildtoscale/.
CA Share of the American Rescue Plan: The Legislative Analyst’s Office published a blog, Flexible Funding to California in the American Rescue Plan. https://lao.ca.gov/Publications/Detail/4407 The American Rescue Plan includes $26 billion in flexible funds for specific projects, based on specific unemployment data used in the calculation. Funds must be used by December 31, 2024.
119,117 initial Unemployment Insurance (UI) and Pandemic Unemployment Assistance (PAU) claims were filed during the report period.
Over 20.3 million initial unemployment benefit claims, including extensions, have been filed with EDD between March 20, 2020 and the close of the report period.
Over 40,450 of these initial claims were filed during the report week by individuals aged 25-35.
Over 34,580 of these initial claims were filed by individuals with a high school diploma or GED.
Over 49,330 of these initial claims were filed by individuals who self-identified as Hispanic.
$128.2 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 May 14, 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-051421.pdf) covering time period of March 1, 2020 through May 8, 2021.
New Employer Portal: The California Labor & Workforce Development Agency launched a new Employer Portal, which is intended to serve as a one-stop hub for California employers to access state and local county COVID-19 guidance by business industry. The portal can be accessed at www.SaferAtWork.covid19.ca.gov. “As businesses across the state continue to adapt through the pandemic, LWDA encourages employers to utilize the portal as a resource for how to operate safely and ensure compliance with state and local guidance.”
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.”
UPDATES AND STATUS REPORTS ON SMALL BUSINESS ACCESS TO CAPITAL
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. The Governor is proposing an additional $1.5 billion be approved, bring the grant program total to $4 billion.
Preliminary data shows that as of May 13, 2021, approximately 198,000 small businesses and nonprofits either have been or will be awarded grants, which includes finalized awards for 43,874 small businesses and nonprofits representing all 58 California counties for a total of $475,001,244.
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.
Restaurant Revitalization Fund: The American Rescue Plan Act authorized the Restaurant Revitalization Fund to provide funding to restaurants and other eligible businesses overcome the economic impacts of COVID-19. https://www.sba.gov/funding-programs/loans/covid-19-relief-options/restaurant-revitalization-fund# The program provides restaurants with funding equal to their pandemic-related revenue loss up to $10 million per business and no more than $5 million per physical location. Recipients are not required to repay the funding as long as funds are used for eligible uses no later than March 11, 2023. Eligible entities who have experienced pandemic-related revenue loss include:
Restaurants
Food stands, food trucks, food carts
Caterers
Bars, saloons, lounges, taverns
Snack and nonalcoholic beverage bars
Bakeries (onsite sales to the public comprise at least 33% of gross receipts)
Brewpubs, tasting rooms, taprooms (onsite sales to the public comprise at least 33% of gross receipts)
Breweries and/or microbreweries (onsite sales to the public comprise at least 33% of gross receipts)
Wineries and distilleries (onsite sales to the public comprise at least 33% of gross receipts)
Inns (onsite sales of food and beverage to the public comprise at least 33% of gross receipts)
Licensed facilities or premises of a beverage alcohol producer where the public may taste, sample, or purchase products
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 the making of 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.
Forgiveness: 55% of loans have completed the forgiveness process, totaling 46% of total 2020 PPP volume. There is $84.3 billion in debt being processed for forgiveness. There is more than $176 billion in loans that has yet to apply for forgiveness. https://www.sba.gov/document/report-sba-covid-relief-program-report
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.
Increase in Loan Limits: SBA increases the maximum amount a small business and non-profit organization can borrow. Starting the week of April 6, 2021, the SBA is raising the loan limit for the COVID-19 EIDL program from 6-months of economic injury with a maximum loan amount of $150,000 to up to 24-months of economic injury with a maximum loan amount of $500,000. https://www.sba.gov/article/2021/mar/24/sba-increase-lending-limit-covid-19-economic-injury-disaster-loans
National-Level Data Update: The US Small Business Administration released program utilization information for the COVID-19 Economic Injury Disaster Loan (EIDL). https://www.sba.gov/document/report-covid-19-eidl-loans-report-2021 As of May 13, over 3.7 million EIDL loans have been approved in the US for a total of $207.3 billion.
State-by-state data on number of EIDL Loans and Targeted EIDL Advance in 2021: As of May 13, 2021, California businesses had 575,255 EIDL loans approved for a total of $36.4 billion. Relative to the Targeted EIDL Advance, 15,424 advances were approved for California businesses for a total of $126.2 million. For the Supplemental Targeted Advance, 2,178 California small businesses received $10.9 million. https://www.sba.gov/document/report-covid-19-eidl-loans-report-2021
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 May 14, 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
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/2021/05/JLBC-4.30.2021-Website.pdf Below is the most recent program activity.
State Small Business Disaster Loan Guarantee Program (April 30, 2021)
Conditionally Approved
Loan Amount
Guarantee Amount
Amount Encumbered
Employees
Total
1621
$69.4 million
$65.6 million
$ 32.8 million
8136
The IBank provides the Joint Legislative Budget Committee an update monthly.
CURRENT GUIDANCE ON STATE COVID-19 AND RECOVERY ACTIONS
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. As of May 17, 2021:
0 counties in the Purple (widespread) Tier
10 counties in the Red (substantial) Tier
35 counties in Orange (moderate) Tier
13 counties in Yellow (minimal) Tier
Moving from Red (substantial) to Orange (moderate): Tehama
Moving from Orange (moderate) to Yellow (minimal): Amador, Orange, Santa Clara and Santa Cruz.
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.
Vaccine Equity: The Blueprint has been modified to include both the level of overall vaccinations across California, as well as the vaccination of individuals living in the state's Vaccine Equity Quartile communities. https://www.cdph.ca.gov/Programs/CID/DCDC/Pages/COVID-19/COVID19CountyMonitoringOverview.aspx In addition, 40% of the state’s vaccine allowance is being allocated to communities hardest hit by the virus.
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.
