BREAKING! Small Business Relief Programs

Dec 01, 2020

URGENT: Small Business Assistance Update

Over the past few months, child care providers like you have been vocal and persistent in sounding the alarms that child care is in crisis! Our union sisters and brothers took countless actions like calling the Governor’s office or holding public rallies outside his office and we believe it worked! We made sure we were part of the conversation of economic relief and that’s the power of our union having one united voice. 

While we wait for federal relief from Congress, yesterday Monday, November 31st, Governor Newsom announced immediate assistance for businesses impacted by COVID-19 – this includes temporary tax relief and $500 million in grants.

Please keep in mind that the state will release more information on how to access these programs. If you are interested, we encourage you to act quickly as funds will be distributed on a first-come, first-serve basis upon meeting qualification requirements.  

  1. The Main Street Hiring Tax Credit, which is the state’s ongoing business support throughout the pandemic, authorized $100 million in hiring tax credits for qualified small businesses. 

 Generally, the small business employer may receive a credit of $1,000 for each net increase in qualified employees from April 1, 2020, through June 30, 2020, compared to July 1, 2020, through November 30, 2020. The total amount of credits received cannot exceed $100,000 for each employer 

The application opened today at 8:00 a.m. The California Department of Tax and Fee Administration (CDTFA) will begin accepting applications for tentative small business hiring credit reservation amounts through the online reservation system. The credit reservations will be allocated to qualified small business employers on a first-come, first-served basis. 

 Make sure to have your business information ready and for more information on calculations and FAQs, please check the application website. 

 This support allows for a small business hiring credit against CA state income taxes or sales and uses taxes to qualified small business employers. Small businesses must meet the following qualifications to quality:

    • Employed 100 or fewer employees as of December 31, 2019, and
    • Suffered a 50 percent decrease or more in income tax gross receipts (generally, all income fewer returns and allowances) when comparing second quarter 2020 to second quarter 2019.
  1. $500 Million for New COVID Relief Grant for Small Business

The Governor announced a new $500 million COVID Relief Grant, administered by the California Office of the Small Business Advocate (CalOSBA) at the Governor’s Office of Business and Economic Development, for small businesses impacted by COVID and the health and safety restrictions. 

  • Funds will be awarded to selected intermediaries with established networks of Community Development Financial Institutions to distribute relief through grants of up to $25,000 to underserved micro and small businesses throughout the state by early 2021. Non-profits would also be eligible for these grants. CalOSBA is establishing the program and will make it available to small businesses as soon as possible – for updates on availability, click here.
  1. Increase Funding for the California Rebuilding Fund by $12.5 million

Last week, the Governor announced the opening of the California Rebuilding Fund. The California Rebuilding Fund is a public-private partnership that aggregates funding from private, philanthropic, and public sector sources to address California’s small businesses’ capital and advisory needs. The California Rebuilding Fund put out $25 million to help impacted small businesses rebuild from the economic crisis and keep local economies strong. This program is built to be a resource in the market for the next year as businesses pivot and recover.

An increase of $12.5 million would allow the fund to be fully capitalized. The additional funding will help the 3rd party administrator raise $125 million to make more low-interest loans to small businesses with less access to loans from traditional banking institutions.

4. Tax Relief for Businesses Impacted by COVID-19 Update

In April 2020, through Executive Order, the Governor allowed taxpayers to apply for penalty and interest relief for 90 days for any taxpayer reporting less than $1 million in sales on their tax return. Through November 22, some 9,287 plans with almost $149 million in tax relief have taken advantage of this program. The Governor will direct CDTFA to do the following:

  • Provide an automatic three-month extension for taxpayers filing less than $1 million in sales tax on the return and extend the availability of existing interest and penalty-free payment agreements to companies (with up to $5 million in taxable sales)
  • Broaden opportunities for more businesses to enter into interest-free payment arrangements.
  • Expand interest-free payment options for larger businesses, particularly those affected by significant restrictions on operations based on COVID-19 transmissions.

CCPU members have raised the need for additional financial support for months, and we’re glad to see more resources made available. We will continue to advocate for what all providers require to operate their businesses, ensuring cities and counties follow proper health protocols and fight for increased financial support for all California child care providers.

Let’s stand together and continue to make our voices heard. Get involved with our union, ask how to participate in actions, and most importantly, become a member of our union and stay a member. Together, we can accomplish anything!

In Solidarity,

Celeste Galeno, CCPU & SEIU Local 521
Deanna Robles, CCPU & SEIU Local 99
Miren Algorri, CCPU & UDW/AFSCME Local 3930