By Nelson A. King
A survey released by the
Brooklyn Chamber of Commerce
says that while a significant
number of Brooklyn small businesses
received funding, amid
the coronavirus (COVID-19) pandemic,
the future still remains
uncertain.
“Brooklyn’s small business
community is still facing a dismal
and difficult road to recovery,”
said the Chamber, basing
its statement on the results of a
survey it released on May 14.
The Brooklyn Chamber of
Commerce’s data is the result of
a second round of surveys looking
into the borough’s economic
climate and the local impact of
government programs designed
to help small businesses hurt by
the COVID-19 pandemic.
The Chamber said survey
highlights include: 92 percent of
responding businesses received
Payment Protection Program
(PPP) funding including 87 percent
of responding Minority/
Women-owned Business Enterprises
(M/WBE) businesses; but
only 23 percent of businesses
received EIDL funding; and 46
percent of businesses missed
May rent payments, with only 21
percent reporting they received
concessions from landlords on
rent for the month.
The survey respondents —
owners of 592 Brooklyn businesses
Caribbean L 14 ife, May 22-28, 2020
in hospitality, retail,
manufacturing, health, tech and
professional services — reported
progress in their applications for
funding under the latest iteration
of the federal CARES Act
program.
Despite a significant uptick in
lending, with 61 percent reporting
major banks as their sources,
and another 11 percent responding
they worked with community
banks, the survey revealed
a full third of the businesses are
at risk of never reopening. Over
95 percent of businesses that
answered have 50 employees or
less, the Chamber said.
“A looming problem for many
businesses is the restrictions for
uses of funding allowed under
the PPP,” the Chamber said.
It said the toll of the COVID-
19 outbreak in New York City
has meant a slower reopening
schedule, “though much of the
PPP money needs to be spent on
retaining or rehiring employees
before the end of June.”
In that instance, the Chamber
said businesses are forced to
rehire employees “when there is
no clear guidance yet on when
they can re-open or what rules
will apply when they do, such as
reduced capacity.”
The Chamber said there are
also restrictions on how much
can be used on rent and other
costs, “which is problematic in
New York City, where rent often
costs far more than 25 percent
of expenses.
“This leaves business owners
having to further deplete capital,
if they have any,” said the
Chamber, recommending “critical
changes to the PPP program
to protect and stabilize the borough’s
business community in
the long term.”
Among the changes the
Chamber is supporting are: Issue
Randy Peers, president and chief executive offi cer of Brooklyn
updated Small Business Administration
(SBA) guidelines to PPP
immediately; extend the date for
businesses to rehire or retain
employees from Jun. 30 to Dec.
31; extend the coverage period to
use PPP funds from eight weeks
to 24 weeks; eliminate the 25
percent non-payroll cap on PPP
funds, so businesses in high rent
areas like New York can allocate
more of their received funds to
rent; and extend the PPP loan
payback period from two years
to five years “so monthly repayments
are more affordable for
small businesses.”
“Increased lending is positive,
especially to our borough’s
MWBEs, but we have to get this
right,” said Randy Peers, Brooklyn
Chamber of Commerce president
and chief executive officer.
“The survival of these businesses,
and their employees is on
the clock,” he added. “We need
flexibility because otherwise the
CARES Act won’t be very caring.”
Chamber of Commerce.
Brooklyn small businesses face
uncertainty, survey shows
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