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Plan to aid small businesses starts with grants – not loans

(Deposit Photos/Air Done)

(Deposit Photos/Air Done)

Small businesses like ours are fighting for survival, but so far our leaders have let us down. When communities are hurting we look to our leaders to help us get back on the right track. Senate Republicans have gone on vacation after offering a proposal that falls far short in scope and scale of the help small businesses and our employees need.

Community means everything to our businesses. Five years ago we started our first restaurant, The Coronado PHX, with a nod to our neighborhood and our city. We added a second coffee shop a couple years ago, and we’ve used both locations to hold community events and bring our neighbors together.

We’re absolutely committed to public health and so we are operating in a way that reduces risks for our community, even if that means sacrificing our own revenue. We haven’t opened for indoor dining or for patio seating even though we’re allowed to do so. We’ve retrofitted our space to keep our employees as safe as possible and we’re offering to-go orders as a way to survive until the crisis subsides.

Since March, sales at our two locations are down 30%-40%. Because of a mix of health concerns, family obligations and lower traffic at our locations, our staff is down by 25%. As a business, we have prided ourselves on providing benefits like health insurance and a living wage in an industry where that is far from the norm, and it’s been devastating to see our employees missing the hours they need to pay their bills.

We received some assistance from the Paycheck Protection Program and the Emergency Injury Disaster Loan, and we’re very grateful. It’s been a lifeline that has helped us keep people employed and on health insurance.

Elle Murtagh

Elle Murtagh

But for months we thought we wouldn’t receive anything. We were denied the PPP by our community bank, supposedly because we didn’t have any current loans with them. This was an arbitrary decision we found out, one of many that private lenders used to sort who got loans and who didn’t. Thankfully, after weeks of hanging by a thread we were accepted in the second round of applications with another bank.

We count ourselves lucky. We were persistent. We know others haven’t been as fortunate, especially businesses owned by people of color and very small businesses — those most likely to be excluded from these programs.

The trouble we’ve gone through to access relief has me worried about the plans to help small businesses and workers that Senate Republicans unveiled in August. They want to use the same structure for relief — loans from private lenders — that has been shown to prioritize large and profitable businesses while leaving real small businesses, especially those in most trouble, jumping through hoops for access if they can get to the programs at all.

Republicans are so out of touch with Main Street that they are holding all legislation hostage unless they get blanket corporate immunity so that bad actors can turn a blind eye and force workers into unsafe conditions without the possibility they might be held responsible for gross misconduct. This type of cynical partisan gamesmanship doesn’t put a penny in my cash register and it doesn’t do a bit of good for the millions of unemployed people and thousands of businesses on the brink of closing their doors permanently. It’s a slap in the face to business owners like me doing everything we can to keep our customers and employees safe.

Senate Republicans, including Senator Martha McSally, must do better. Instead of going to bat for hardworking Arizonans and keeping our own government response accountable, she’s wasting energy on bills that blame China for a public health crisis they got under control months ago.

A real plan to save our small business economy starts with grants — not loans — so we can cover payroll and keep people employed and will last the length of the pandemic. Funding eight weeks of recovery will put us right back where we are in October. We need a plan that acknowledges that the pandemic will be with us into the beginning of next year and its effects will linger for much longer. There is a program with bipartisan support that was included in both HEROES and HEALS—the Employee Retention Tax Credit, a fully and immediately refundable tax credit — that can be expanded to meet the needs of small business. This payroll subsidy plan that keeps businesses afloat and workers employed is what many other countries have chosen and that have saved their economies from crashing. The Employee Retention Tax Credit needs to be included at the level indicated in the HEROES Act or higher and provide assistance with operating costs like rent and mortgage payments.

In addition, no one should be evicted during a pandemic. It must provide real funding to turn the tide on the public health crisis. Public health and economic prosperity are not competing aims. One is a prerequisite for the other. And any plan has to have a realistic timeline.

Now is the time to get things right. We can’t afford another regression like we’ve seen across our state this summer.

Elle Murtagh is the owner of Coronado PHX and Dark Hall in Phoenix and a member of the Main Street Alliance.

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