On Friday, April 17, 2020, the Greater Memphis Chamber hosted a meeting with Congressman David Kustoff to help businesses understand legislation and programs available to aid in economic recovery. This is one of several events the Chamber is hosting with state and local leaders to keep the Greater Memphis business community informed.
Congressman Kustoff shared that the Congress and Senate will not be back in session until May 4, 2020. The CARES Act, which was a 2 trillion-dollar package, has gone through it’s third round. The Paycheck Protection Program (PPP) was passed, however funds for this program will run out of money this week. They would like to approve additional $250 billion in funding, but the House and the Senate have to be in session in order to vote. They cannot vote remotely.
He has been in close discussion with Governor Lee about reopening.
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Question: What would it take to get Congress back in session? Essential businesses are open and Congress Hpw is considered essential. Can the President call them back into session?
Answer: Yes, the President could call everyone back in session, but that would be up to Nancy Pelosi and Mike Pence.
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Question: I am the CEO of a foreign-owned company. Is it true that the company does not qualify for the PPP and will that change?
Answer: Based on the guidance, that is correct. Nor has there been any discussion or debate about removing that restriction on foreign-owned companies.
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Question: I am the sole owner of a LLC Interior design firm and communications is very poor between, CPAs, banks and attorneys, which has been costly for small businesses. Information is constantly changing. I have missed out on funding due to constant changes.
Answer: A big part of the communication problem is the CPAs, banks and attorneys are waiting for guidance from the Treasury and the SBA. There have been issues with interfacing with the SBA system. Not an excuse, but all of this came together in only a week.
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Question: Under the PPP, 1099 Contractor’s loans were reduced and they have been asked to apply for their own PPPs. How is this being addressed?
Answer: 1099s run the gamut. Trying to advocate, but it is an evolving process and it has been going on for the past 14 days.
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Question: How do you avoid bailouts on mismanaged states vs well managed states?
Answer: Prior to the Coronavirus, teachers were going to receive a 4% raise, but it was changed to 2%. Te 4% is still needed. Before anything is done. We need to see how the 2 trillion dollars will work it’s way through the economy. We need to see the affect it is having on the economy before moving ahead. What works and what does not work before another appropriation.
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Question: I have a transportation company and I am looking at having to layoff a significant amount of people. The company does not qualify for a PPP Grant. Why is a mid-sized company not qualify for a grant?
Answer: When this deal was crafted the cutoff was 500 employees. There had to be a limit on the size. If there wasn’t the money would be gone.
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Question: What does the relationship with the United States and China look like after this?
Answer: After seeing how the virus has raged through China, the question raised was, would there be a permanent disruption of the supply chain of goods from China. The U.S. did not know of the virus in China until late 2019. We started get health warnings at the end of February. China had not been accurate in their numbers. There is a possibility that some US manufacturers could relocate out of China.
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Question: Why is there a slow response from The Economic Injury Disaster Loan Program?
Answer: There was not enough money appropriated for the loss of business revenue. There was more demand than money. For some, insurance was able to cover it.
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Question: These PPP programs – With the main street of programs, are they all pulling from the same pool of monies?
Answer: Yes, more demand than funding.
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Question: Hospital funding – Under HHS, are monies getting directed to other states?
Answer: From the CARES Package of 2 trillion dollars, $100 billion was directed to hospitals. There will be another bill passed that will include hospitals. He was not aware of funding going to other states, but wanted to be informed if anyone heard that monies are being directed out of the state.
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Question: Are there guardrails to ensure that the monies are being used for payroll?
Answer: 75% is used for payroll. There will be an audit done for the use of the funds. It must be used correctly to be forgivable.
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Question: What can we as small- business people do to help open the economy again?
Answer: We are trying to see what health experts recommends. Each state will be different. We cannot afford more relief packages. We cannot rely on examples. There needs to be an increase in testing.
For more business resources, visit our COVID-19 Business Resources Page.
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