Mayor Jenny Durkan will be issuing an executive order later this week to implement relief measures for small businesses that are negatively impacted by the spread of the COVID-19 virus.
Small businesses are particularly susceptible to sudden economic downturns. With financial impacts from the local coronavirus outbreak already being felt, the restaurant industry is preparing for the worst, with many restaurants seeing a 40 percent dip in business as of last week, according to the Office of Economic Development (OED). Hotels are seeing dwindling occupancy rates. Business owners are scared.
In response, Durkan's administration has announced a relief package to help small businesses across the city.
“The next few months will be tough," Durkan said in a statement. "Every day, we will be evaluating how we can support our workers and keep our businesses afloat in this public health emergency. Ultimately, we know that the federal government must take the lead and keep our small businesses and workers at the forefront of our assistance and relief.”
These are the steps Durkan will move to implement later this week, according to a statement from the mayor's office:
Deferral of B&O taxes: Effective immediately, the Department of Finance and Administrative Services (FAS) will defer business and occupation (B&O) tax collections for eligible business owners, allowing small business owners increased flexibility during a period of financial duress caused by the COVID-19 outbreak. Expansion of small business stabilization fund: OED is expanding their small business stabilization fund to support income-qualified microbusinesses. Assistance to access Small Business Association loans: OED will provide direct technical assistance to local small businesses and nonprofits to ensure they can immediately access the Small Business Administration’s (SBA) federal loan program once it becomes available. Relief for Utility Payments: As announced earlier by Mayor Durkan, all Seattle Public Utility and Seattle City Light customers can set up deferred payment plans if their financial stability has been jeopardized by COVID-19. New Small Business Recovery Task Force: The Mayor has appointed former Governor Gary Locke and former Council President Bruce Harrell to lead the COVID-19 Small Business Recovery Task Force, which will advise on long-term policy recommendations and provide technical assistance and outreach.
The B&O tax, Washington's ass-backward way of taxing businesses, is the second-largest source of revenue
in the state. Durkan's announcement that the city will forgive late payments on those taxes and on utility bills ties in with statements Gov. Jay Inslee made Tuesday morning about allowing employers impacted by COVID-19 to delay tax payments. All Seattle businesses that make $5 million or less in annual revenue and pay quarterly taxes to the city can qualify for the B&O tax deferral.
The small business stabilization fund was implemented in Seattle in 2019 and gave up to $25,000 in grants to small businesses with five employees or fewer. Those requirements remain, however the program has been expanded to support microbusinesses. These are businesses owned by low-income residents (at or below 80 percent of the Area Median Income).
As for federal funding, a chunk of change should be coming from Congress, which recently approved an $8.3 billion package for COVID-19 relief.
"We don’t have a specific dollar amount for what the federal government is allocating to small businesses," Kelsey Nyland, a spokesperson with the mayor's office, told The Stranger in an email. "The city’s been in contact with the Small Business Association about the need to make the funds available ASAP, but we don’t have a timeline from them yet."
The mayor is expected to send legislation to the Seattle City Council that includes these measures this week.