As we wrap up the second full week of our “stay at home” directive, we sincerely hope that you are all doing well both in health and in business. We’re here for you and hope that the information that we’ve been sharing is beneficial as you go about running your operations. We understand tough decisions remain ahead.
Before we get into the updates for today, please know that plans are in place to begin delivering a weekly recap through our Facebook, Twitter, and LinkedIn page. If you currently do not follow us, you can here:
So, first things first, it appears that the PPP grant/loan has potentially hit a few snags behind the scenes. Rules and details of what needs to be included on applications were changing even today, the first day to apply. Sounds like more clarity is needed and once some issues are resolved then more lenders will be coming on board. With that said, reports this afternoon are some financial institutions have been accepting applications and have taken a little more than $880 million in requests in the first hour or two.
Yesterday we published a partial list of banks that had indicated they would be servicing this product. There are others that will be added as we indicated above. In the meantime, if you have a relationship with a bank or credit union and have not reached out to them yet, now is the time to get in contact. Speak with those you have built relationships with and get the best advice on how to aid your organization.
A Note from the Governor’s Office on Unemployment Benefits
The recently passed CARES Act enhances existing unemployment benefits and creates entirely new benefits for individuals previously not eligible for unemployment. It is important to note that some of the new benefits will not be immediately available and will take time to roll out. Specifically, the Pandemic Unemployment Assistance (PUA), which provides 39 weeks of unemployment benefits to individuals not eligible for regular unemployment, like independent contractors and sole proprietors. As you receive inquiries please convey to your stakeholders/constituents that these benefits are not immediately available as it will take time for IDES to implement this brand-new program.
Individuals interested in PUA should be advised to NOT call the Department of Employment Security asking to sign up. Calling or going online for PUA benefits will contribute to delays on the IDES call lines and the website. Further, if individuals attempt to apply for PUA benefits before IDES has fully implemented the new program, they will receive a denial letter. Once IDES can roll out the new PUA program, an announcement will be made, and applications will be available online and via telephone. Attached is an FAQ regarding the enhanced and new benefits created by the CARES Act and below is a brief statement that can be used when discussing these benefits and the delay in the program:
IDES is actively working to implement the recently enacted federal stimulus package as it relates to unemployment benefits. We understand that many people are eager for information about how this will impact their current and future unemployment benefits, particularly those who have not traditionally been eligible for benefits, including independent contractors and sole proprietors. However, the stimulus package will take time to implement, and some of the unemployment benefits included do not begin immediately. Therefore, we ask that individuals who believe they qualify for unemployment benefits please wait to call our customer service center until the program has been fully implemented in order to allow our front-line employees to process the large increase in claims for regular unemployment benefits. If you believe you qualify under the new federal programs, you may apply for regular unemployment benefits online; however, you may receive a letter denying your application until IDES has fully implemented the new programs. Further details about these new federal programs, how to apply, and eligibility requirements will be made available as soon as they have been finalized. Information will be accessible at IDES.Illinois.gov once available.
We’re hearing some more information on the next stimulus plan. Surely there are holes that will need to be filled as the Phase 3 plan moved quickly and likely left several issues unsolved and gaps unfilled. Here are four things being discussed as part of a “phase four” bill:
Lawmakers in both parties have talked for years about doing a substantial bill but haven’t been able to find a deal on the main sticking point: how to pay for it.
In the House they’ve talked about how new funds could cover broadband, schools, water, and other infrastructure systems. These projects would ultimately create jobs which would be greatly welcome coming off record unemployment claims. President Trump seems to be behind the legislation as well, but some concerns have emerged from those worried about how the plan would be paid for, especially coming behind the $2 trillion stimulus package.
Individual Cash Payments
Lawmakers have warned that the one-time payment will not be enough for Americans who could be struggling to make monthly payments like rent and utilities. A few initial proposals were calling for two rounds of payments. Ultimately the final call was for the $1,200/$500 payments and wait and see that a second funding round would be needed.
State and Local Government Funding
Initially a total of $750 billion was requested for states and local governments so that they could be stabilized. The final number rested at $150 billion. We won’t really know how much of a hit state and local bodies are taking until the final April number come in as March was a partial lockdown. In any case, the loss of sales, hotel/motel, motor fuel and other taxes are surely going to hit hard. Joliet alone will see a loss of a little over $1 million per month on lost casino revenue.
We think we can all agree that more needs to be done to bolster the health care system. Senator Schumer is calling for retroactive “hazard pay” for doctors and nurses and to “make that mandatory” in the fourth coronavirus bill. “I am urging President Trump to give all of the federal front-line workers hazard pay, and I would think a very important thing in our next bill is to require hazard pay for all of the front-line workers.” Democrats are also pushing for the next bill to include free treatment for the coronavirus.
Finally, we all know of the condition our state is in and has been in over the past number of years. The Coronavirus situation certainly is not helping at all. Currently the Governor’s budget team is working to estimate how much revenue will be lost and somehow figure out when the economy will rebound. Not an easy task.
The budget proposal delivered in February will almost need a full overhaul. If we look back to the ‘08/’09 downturn, Illinois saw overall revenue drop nearly 9% over a three-year time period. Forecasters currently are estimating a potential 20% drop or roughly $8 billion over the next several years.
The bright spot here is that a comparison of February and March 2020 vs. February and March of 2019 show higher sales tax and income tax numbers. The April numbers will give all of us the best guidance as to how the affects of the virus have impacted us. Unfortunately, the state income tax push back to July 15 will surely add a burden as well. As of April 1, only a reported 58% of tax returns had been filed. In addition, lawmakers are unsure as to when they’ll report back to Springfield and efforts to convene remotely are unsure to be possible.
We hope that you all have a wonderful weekend and are ready to tackle what next week brings.
Joliet Region Chamber of Commerce & Industry Staff and Board of Directors
Vice President – Government Affairs
Joliet Region Chamber of Commerce & Industry