Senator Susan Collins unveils plan to save small business jobs with payroll cash infusion

WASHINGTON D.C. – As lawmakers work to blunt impact to the United States’ economy, Senator Susan Collins yesterday rolled out a plan to save the jobs of tens of thousands of small business employees in Maine and millions around the nation.

As a senior member of the Appropriations Committee, Sen. Collins has considerable influence in policies affecting the nation’s financial health in the coronavirus crisis and has been focusing on the impact of the pandemic on the people and small businesses of Maine.

“I have been working with Secretary Steven Mnuchin and a group of my Senate colleagues, including Small Business Committee Chairman Marco Rubio, on legislation to address an issue facing small businesses in Maine and throughout the nation,” said Senator Collins. 

“Our plan will address the cash flow problem that small businesses are facing through no fault of their own by providing guaranteed federal loans to be used to pay their workers.  An example is the hospitality industry in my state, where we have numerous restaurants, hotels, and B&Bs, that are being affected already due to the cancellation of graduations, conferences, and other events.  As long as the business does not lay off any of its employees, the loan would be forgiven when it matures.”

According to a press release from Sen. Collins, her plan would do the following:

-Provide cash-flow assistance quickly to employers who agree not to lay-off their workers. This cash-flow assistance could be as much as the employer needs to stay in operation without lay-offs. The cash-flow assistance must be used to pay employees.

-When the crisis passes, the cash-flow assistance would be forgiven, so long as the employer keeps their workers employed and paid.

-This cash-flow assistance would be structured as federally-guaranteed loans made available through any lender qualified to make SBA 7(a) or 504 loans, and also FINTECH lenders approved by the Secretary.

-Terms would match those of SBA’s Economic Injury Disaster Loans (EIDL), except that the loans would be fully forgiven if the employer keeps its workers employed through the crisis.

-The amount loaned could either be drawn from a line of credit as needed, or the employer could estimate up front the amount it needs to cover lost revenue needed to make payroll during the crisis.

-If the employer draws more than is needed, the employer could repay the excess without penalty when the crisis is over. Alternatively, and if the employer otherwise qualifies, the excess could be converted to a loan on standard terms.

-Loans would be available for the duration of an “emergency period” beginning on March 1 and ending June 30, unless extended through December 30.  Loan forgiveness would accrue over the same period.

At a Wednesday press conference, Senator Marco Rubio (R – Florida) who is the Senate’s Small Business Chairman, said Senator Collins had been “instrumental” in creation and development of the plan.

Early reports indicate that the state of Maine has already seen about 5,000 claims for unemployment filed. With Governor Janet Mills’ newly imposed restrictions allowing restaurants to only provide takeout and delivery service, tens of thousands more Maine jobs were immediately placed in peril.

A number of other plans are in development in Washington D.C. as well. Those include proposals to shore up larger business, provide direct stimulus checks to individual Americans and families and a number of efforts to put federal and state government on the best footing possible to handle the coronavirus outbreak.

While details are still being worked out on the direct stimulus to individual Americans and families, it is possible that stimulus checks of $1,000 or more per person could be sent out by the federal government in just the next few of weeks under “Phase Three” of the coronavirus response plan. Some versions of the plan include more than one round of stimulus checks.

Yesterday Senator Collins also voted in favor of another coronavirus response bill. That bill included provisions to pay for virus testing, bolster unemployment and food assistance, expand paid sick leave, and send additional aid to states.

You can watch video of the press conference held by Senator Susan Collins and Senator Marco Rubio below.

Pin It on Pinterest