Santa Stimulus: Update from Ironwood Venture
This week, we’ve been reviewing with our clients the details (albeit limited) surrounding the $908 B bipartisan economic relief proposal and wanted to share with our SMB community as well.
Note that this is economic relief and not true stimulus so it doesn’t include the individual checks or other components, but it does include several positive business impacts:
- $288 B for Small Business
- PPP Round II
- The details are missing but it’s expected that the Senate SB Committee will drive the details, led by Rubio and Cardin
- In the last proposal from this group, the PPP funding required a 30% decline in revenue to qualify
- Our best guess is that Congress wants to get this into the hands of “true” small business asap with little limitations
- As expected, there is and will be tremendous fraud and general misconduct so our assumption is that the SBA will process these loans with a low $$ threshold quickly (say $250k?)
- It looks like there will be another round of EIDL; the hope would be that these are forgiven someday but that is still a small percentage of likelihood
- $180 B for Unemployment Benefits
- The bi-partisan proposal calls for $300 weekly enhancement to state funded benefits
- Although this is ½ of what the benefit was with the CARES Act, it still will factor in for those businesses that have fluctuating hiring needs and competing against the alternative
- Temporary Liability Shield
- This would be a benefit to all business owners but the language is vague at best, and it’s a contentious topic between the elephants and donkeys
- The one-page summary released by the bipartisan working group includes only one line: “Provide short term federal protection from coronavirus-related lawsuits with the purpose of giving states time to develop their own response”
- For those of us that like to celebrate our local postal carrier this time of year for all of their hard, and often times, unappreciated work – they get $10 B!
As always, reach out if you have specific questions.
Patrick J. Holcomb
Founding Partner, Ironwood Venture I m: 805.709.8270