For those with children at home, California may reopen schools as early as July. Schools will not be fully functional as there will be major changes to physical education classes and recess at schools, as well as processes to deeply clean and sanitize schools, parks and playgrounds to keep infection rates down. The certainty of this decision is low, however, as  this comes at a time where the stay at home order has been extended statewide to May 15th for larger communities such as LA and the Bay Area.

Governor Newsom’s decision to reopen schools and the economy is still being decided, where he officially asked the media to check in in mid-May. His decision will be based on six factors:

1. expanded testing to identify and isolate patients,
2. maintenance of vigilance to protect seniors and high risk people,
3. being able to meet future surges in hospitals with a “myriad of protective gear,” continue to collaborate with academia on therapies and treatments,
4. to redraw regulations to ensure continued physical distancing at private businesses and schools; and
5. develop new enforcement mechanisms to allow the state to pull back and reinstate stay-at-home orders.

More details at: https://www.cnn.com/2020/04/28/politics/california-phased-reopening-plan/index.html

On Tuesday, April 21, 2020 the U.S. Senate passed the Paycheck Protection Program and Health Care Environment Act:  A $484 billion relief package to fund small business loans, hospital aid, and testing for COVID-19. Of that $484 billion, $310 billion will go directly to PPP funding. The original PPP program ($349 billion) ran out of money less than two weeks after it opened, having approved over 1.66 million loans, thus the renewed funding could likewise be quick to be depleted.

Besides decreased funding, concerns exist due to a lack of changes to the original PPP’s guidelines, which became infamous due to what was seen as an inability for “mom & pop” small businesses to find a lender to apply to in time. Still, the new PPP Act has yet to approved by the House, so its final form is unclear. Nevertheless, there are some small improvements in that, of the $310 billion authorized for the Paycheck Protection Program, $60 billion will be set aside for smaller lending facilities, including “community financial institutions, small insured depository institutions and credit unions with assets less than $10 billion.” There will also be $10 billion for grants under the Emergency Economic Injury Disaster Loan program, $50 billion for disaster recovery loans and $2.1 billion for additional salaries and expenses for the Small Business Administration.

The bill will also provide $75 billion for hospitals and health care providers stretched thin by the pandemic to address Coronavirus expenses and lost revenue, and an additional $25 billion to facilitate and expand “necessary expenses to research, develop, validate, manufacture, purchase, administer and expand capacity for COVID-19 tests.”

More details at: https://www.cnn.com/2020/04/21/politics/chuck-schumer-coronavirus-relief-small-business-cnntv/index.html

This bill has since been passed by the house on 4/23/20 with no changes made, and will be signed into law later today.

Starting Friday in Marin County & Sonoma County, people must wear masks at all times when using essential services such as the grocery store or riding the bus. Fremont is also requiring masks. The city has issued an executive order making it mandatory for workers and customers at most essential businesses to cover their faces. This means wearing masks at restaurants, gas stations, grocery and hardware stores. For those who don’t comply, the fine is up to $100.

Countering this move, some counties are relaxing restrictions. For example, Santa Cruz County has already taken a small step in reopening its beaches and parks. Bay Area public health officials will watch the reaction to the beach and park reopening carefully before considering whether to open similar waterfront sites, such as Ocean Beach in San Francisco, Pillar Point Harbor in San Mateo County or Jack London Square in Oakland.

For more info see: https://www.nbcbayarea.com/news/coronavirus/face-mask-requirements-begin-to-take-effect-in-some-parts-of-the-bay-area/2274570/

Executive Order N-51-20 was signed and helps workers from large employers in the food sector industry impacted by the COVID-19 pandemic with two weeks of paid sick leave, filling a gap left by federal relief that had provided similar paid leave benefits for employers with fewer than 500 workers.

“These workers on the front lines of this crisis are our unsung heroes for continuing to work to ensure that Californians have food on their tables during these challenging times, and we must do everything in our power to make sure they are taken care of at home and in the workplace. Making sure they have paid sick leave and added protections in their place of work is critical,” said Governor Newsom.

Additionally, the Executive Order provides health and safety standards to increase worker and customer protection by permitting workers at food facilities to wash their hands every 30 minutes, or as needed, to increase proper sanitation measures. An important update, that perhaps should have been part of their job well before COVID-19.

The full order can be read here: https://www.gov.ca.gov/wp-content/uploads/2020/04/4.16.20-EO-N-51-20.pdf

The wildly infamous Payment Protection Program (“PPP”) officially opened on April 3rd but ran out of money less than two weeks later on April 16th. Its nature as a forgivable loan, or at worst one with 1% interest, made it a popular request for donors, but less so to the banks themselves. As such, banks prioritized their current customers, yet even so, the fund quickly ran out before many small businesses were able to apply. The PPP has caused quite the media storm, so much so that some companies are giving back their PPP loans to offset their bad press (i.e. Shake Shack returned their $10 million loan in lieu of bad press). As expected, several banks are now being sued and accused of prioritizing their big customers over smaller businesses. The accuracy of these allegations is unknown; however, banks such as Chase state that “[e]ighty percent of PPP loans processed through Chase went to businesses with less than $5 million in revenue. About half went to small businesses with less than $100,000[.]”

Regardless, we know a lot of people missed out on applying. In response, Congress is looking to approve an additional $450 billion in funding to the PPP programs (as well as for COVID-19 testing). The agreement is expected to be reached later on Monday, April 20th, and may be submitted as early as Wednesday the 22nd for full Congressional approval. As such, those who missed out on the PPP loans may get another opportunity to apply.

More info: https://www.usatoday.com/story/money/2020/04/20/small-businesses-sue-chase-bank-over-handling-stimulus/5163654002/ AND https://www.inquirer.com/politics/nation/coronavirus-covid-trump-congress-democrats-second-stimulus-bill-small-business-loans-testing-20200419.html

Ultimately, the decision will be by the states themselves; however, guidelines were set by the Whitehouse to provide a three-phased approach to reopening the US economy in light of COVID-19 and rising weather temperatures. The benchmarks for the beginning the first phase of lifted restriction include a sustained decrease in cases over a 14-day period and a return to pre-crisis conditions in hospitals.

PHASE ONE [see https://www.whitehouse.gov/openingamerica/#phase-one]
The phased approach encourages all individuals to continue good hygiene practices like washing hands and to “strongly consider” using face coverings in public. Further suggestion are that schools that are currently closed should remain so and employees who are able to telework should keep working from home. Large venues, including some restaurants, can operate under strict social distancing protocols. Gyms can open as long as they maintain social distancing guidelines, but bars should remain shuttered. The guidelines still recommend minimizing nonessential travel, and indicate vulnerable populations should remain sheltered-in-place.

PHASE TWO [see https://www.whitehouse.gov/openingamerica/#phase-two]
Non-essential travel may resume; however, “vulnerable individuals should continue to shelter in place. Employers should Continue encourage telework, whenever possible and feasible with business operations; close common areas where personnel are likely to congregate and interact, or enforce moderate social distancing protocols; and strongly consider special accommodations for personnel who are members of a vulnerable population. School however, can reopen.

PHASE THREE [see https://www.whitehouse.gov/openingamerica/#phase-three]
Here, vulnerable individuals can resume public interactions, but should practice physical distancing, minimizing exposure to social settings where distancing may not be practical, unless precautionary measures are observed. Still, low-risk populations should consider minimizing time spent in crowded environments. Employment can fully resume, but gyms, bars and large venues need to keep physical distance protocols.

See more info at: https://www.cnn.com/2020/04/16/politics/donald-trump-reopening-guidelines-coronavirus/index.html

The International Monetary Fund (“IMF”) expects a three percent negative change in worldwide Gross Domestic Product (“GDP”) for the year 2020. They estimate this will be the worst recession since the Great Depression. Estimates shows that GDP in the USA is expected to decrease 5.9%, signaling the second highest drop in combined economic growth; Europe is expected to experience a slightly smaller decrease in GDP.

Though this is unfortunate, there is good news. Firstly, GDP growth is expected to return in 2021, though not as fast in the U.S. as in other advanced economies. Secondly, there are tax vehicles available which can protect your assets and decrease tax burdens while the market rebuilds.

See more info at https://blogs.imf.org/2020/04/14/the-great-lockdown-worst-economic-downturn-since-the-great-depression/ or contact us here at Burton Law Firm.

Touting a decline in the spread of COVID-19 based upon occupied hospital beds, Governor Newsom is coordinating with governors in Oregon and Washington to end the statewide stay-home order he imposed nearly a month ago to slow the spread of the deadly Coronavirus pandemic. No end date was provided, and restrictions will be eased, not lifted. Still, this will hopefully be safely and smartly implemented in the upcoming weeks.

See more info at: https://www.mercurynews.com/2020/04/13/coronavirus-gov-newsom-says-west-coast-coordinating-plans-to-end-lockdowns/

Governor Newsom announced the State of California will make available $42 million to protect foster youth and families impacted by COVID-19. The foster care system has been heavily impacted by COVID-19 due to school closures and social isolation. Specifically, $27.8 million will be provided to help families stay together; nearly $7 million will support overtime and additional outreach by county social workers to foster family caregivers at higher risk of COVID-19; and $3 million will fund Family Resource Centers and provide direct support and services to foster families. Specific uses of the fund can be seen here; in short, the funds will be used to “[prevent] child abuse and neglect, strengthening children and families, and connecting families to an array of county support systems of care.”

More detail at: https://www.gov.ca.gov/2020/04/13/governor-newsom-announces-42-million-to-protect-foster-youth-and-families-impacted-by-covid-19/

The Franchise Tax Board recently announced a special tax relief for California taxpayers affected by the COVID-19 pandemic. Affected taxpayers are granted an extension where those tax filings and payments due have been extended from April 15, 2020 to July 15, 2020. This extension expands beyond individual returns and includes Corporations, S-Corps, LLCs, Partnerships, and other entity types with returns due during this period.

Those that are “affected taxpayers” need not have been directly impacted or diagnosed with COVID-19. The language is broad enough to where taxpayers who experience any difficulty in filing or paying, as a result of COVID-19, are included in this relief. Even so, relief is not automatic, and all individuals and entities will need to self-identify on their tax returns (as one would with other natural disasters).

For more details, please see the FTB release at: https://www.ftb.ca.gov/about-ftb/newsroom/news-releases/2020-2-more-time-to-file-pay-for-california-taxpayers-affected-by-the-covid-19-pandemic.html?WT.ac=COVID-19.