Brad A. Molotsky – Page 8 – Project Development/Infrastructure/P3

April 22, 2020June 11, 2020 by Brad A. Molotsky

COVID-19: PA defers payment obligations and maturity dates by 3 months on loans from various Commonwealth Agencies (NOT a reduction in amount owed)!

Today, Department of Community and Economic Development (DCED) Secretary Dennis Davin announced that the Pennsylvania Industrial Development Authority (PIDA), Pennsylvania Minority Business Development Authority (PMBDA), and Commonwealth Financing Authority (CFA) are deferring loans and that the maturity dates and amortization schedules of all applicable loans are extended by three additional calendar months.

“As we look to the future for a phased reopening of Pennsylvania’s economy, it is imperative that we provide relief to businesses affected by the administration’s stay-at-home order,” said Sec. Davin. “Businesses statewide have been cooperative and made sacrifices for the health and safety of their communities, and we are committed to supporting them through the next steps ahead.”

PIDA borrowers with payments due in April, May, and June of 2020 are deferred. All other terms and conditions of all applicable loans remain unchanged.

PMBDA borrowers with payments due in April, May, and June of 2020, including principal, interest, and any associated feeds are deferred. Accrual of interest that would be included with deferred payments is suspended. All other terms and conditions of all applicable loans remain unchanged.

CFA borrowers except for PENNWORKS loans, with payments due in April, May, and June of 2020, including principal, interest, and any associated fees are deferred. Accrual of interest that would be included with deferred payments is suspended. All other terms of all applicable loans remain unchanged.
DCED continues to update its website with financial and other resources.

Businesses seeking further guidance and clarification from DCED can also contact its customer service resource account at ra-dcedcs@pa.gov.

For the most up-to-date information on COVID-19, Pennsylvanians should follow www.governor.pa.gov and www.doh.pa.gov.

Duane Morris has created a COVID-19 Strategy Team to help organizations plan, respond to and address this fast-moving situation. Contact your Duane Morris attorney for more information. Prior Alerts on the topic are available on the team’s webpage.

For Further Information:

If you have any questions about this post, please contact Brad A. Molotsky, Matt LoBello or the attorney in the firm with whom you are regularly in contact.

April 21, 2020 by Brad A. Molotsky

COVID-19: Maryland issues Executive Order Temporarily Halting Residential and Commercial Evictions

Maryland Governor Lawrence J. Hogan issued Order Number 20-04-03-01 on April 3, 2020 (the “Order”) that amends and restates an order previously issued on March 16, 2020 that, among other things, temporarily prohibits evictions of tenants suffering substantial loss of income due to COVID-19. The Order expands the coverage of the original order to temporarily prohibit commercial and industrial evictions.

The Order applies to Section 8—401 of the Real Property Article of the Annotated Code of Maryland (the “Real Property Article”) (i.e. repossession following failure to pay rent when due and payable) and Section 8-402.1 of the Real Property Article (i.e. proceedings upon breach of lease) and provides that:

“No court shall give any judgment for possession or repossession, or warrant for restitution of possession or repossession of residential, commercial, or industrial real property, if the tenant can demonstrate to the court, through documentation or other objectively verifiable means, that the tenant suffered a Substantial Loss of Income.”

Under the Order “Substantial Loss of Income” is defined as:

“Substantial Loss of Income” means (i) with respect to an individual, a substantial loss of income resulting from COVID-19 or the related proclamation of a state of emergency and catastrophic health emergency, including, without limitation, due to job loss, reduction in compensated hours of work, closure of place of employment, or the need to miss work to care for a home-bound school-age child; and (ii) with respect to an entity, a substantial loss of income resulting from COVID-19 or the related proclamation of a state of emergency and catastrophic health emergency, including, without limitation, due to lost or reduced business, required closure, or temporary or permanent loss of employees.

The Order further clarifies that the fact that the tenant, or any person permissibly cohabiting with the tenant in accordance with the terms of the lease, has a confirmed diagnosis of COVID-19 or is under investigation for COVID-19, shall not constitute a “clear and imminent danger” of the tenant’s or other person’s doing harm to themselves, other tenants, the landlord, the landlord’s property, or any other person on the property, for the purposes of establishing that there has been a breach of the lease.

The Order provides that the prohibitions regarding evictions are in effect until the state of emergency is terminated and the catastrophic health emergency is rescinded.

It is noted that the Order only temporarily prohibits landlord eviction actions and does not expressly relieve or reduce any tenant payment obligations (including late fees, interest or other damages) or prohibit the application of any security deposits or the drawing of any letters of credit. Although not addressed in this Alert, it is further noted that the Order expressly prohibits the initiation of residential foreclosures, but does prohibit commercial foreclosures.

For Further Information:

If you have any questions about this Alert, please contact Thomas Totten, Gordon Knox or any member of the COVID-19 Strategy Team or the attorney in the firm with whom you are regularly in contact.

April 20, 2020April 24, 2020 by Brad A. Molotsky

COVID-19: PA Extends Closure Order until May 8th but will relax Auto Sales, Liquor Sales and some Construction Activities Restrictions (May 1)

On April 20, Governor Tom Wolf extended Pennsylvania’s stay-at-home order until May 8, 2020.

The governor indicated he would be using a region-by-region approach that is data-driven and will include strict social-distancing measures as he considers reopening parts of Pennsylvania.

However, he announced three actions that offer some flexibility to businesses, including permitting curbside pickup of orders at state liquor stores, allowing auto sales online and opening what he said were various construction activities statewide on May 1st. More specific guidelines will be released at a later date.

To read the full text of this Duane Morris Alert, please visit the firm website.

April 20, 2020 by Brad A. Molotsky

COVID-19: Florida COVID based Loans and Grant Programs

In response to the current COVID-19 pandemic, Federal, State and Local governments are ushering in an array programs and tax relief measures to help mitigate the adverse economic impact of COVID-19 on business and nonprofit entities.

In addition to the economic incentive provisions and programs that are available through the federal CARES Act, including the $350 billion Paycheck Protection Program (PPP) and under U.S. Small Business Administration’s (SBA) Emergency Injury Disaster Loan (EIDL) program, a number economic programs tax relief measures, and deadline extensions for applicable in Florida related to or effected by the COVID-19 pandemic and closures.

1. Florida Small Business Emergency Bridge Loan Program. The Florida Small Business Emergency Bridge Loan Program is currently available to small business owners located in all 67 Florida counties statewide that experienced economic damage as a result of COVID-19. The program is being administered by the Florida Department of Economic Opportunity in partnership with the Florida SBDC Network and Florida First Capital Finance Corporation. This program is intended to offer short-term, interest-free working capital loans to help “bridge the gap” between the time a major catastrophe hits (COVID-19) and when a business has secured longer term recovery resources, as follows:

General Terms and Conditions:

o Loans of up to $50,000 to $100,000 in certain special cases are available to coronavirus-affected small businesses.
o Loans are interest-free for 1 year; after that, the interest rate rises to 12%.
o The loans are meant to serve as short-term funding that can be repaid once businesses can access alternative funding such as: SBA disaster loans, other Federal Aid-Insurance Proceeds, bank or other loan.
o Loans will be made to individuals who, individually or collectively, own at least 51% of the equity of the business and who certify that: loan proceeds will be used only for purposes of maintaining or restarting business operations in the designated disaster area; the loan will be repaid by applying for other financial assistance; and the borrower will be required to certify that the proceeds of insurance claims, other loans applied for or to be applied for, or other financial assistance will be used to repay the loan.

Eligibility:

o Business must be physically located in the area of a designated disaster in Florida.
o Business must be a for-profit, privately held small business that has or had a minimum of 2, but no more than 100 employees within the previous year of the date of the declared disaster.
o Business must have been established and actively operating prior to the date of the Designated Disaster Date: March 9, 2020.
o Business must have repaid, in full, any previous Florida Small Business Emergency Bridge Loan.
o Business must demonstrate that the business has suffered a significant economic injury and unable to meet its obligations to pay ordinary and necessary operating expenses as a result of the declared disaster event.

How to apply:

o Eligible applicants must submit an application by May 8, 2020, along with supporting documents including business tax returns, individual tax returns and employer tax documentation.
o Information from Florida. Applications and more detailed information is available from the Florida Department of Economic Opportunity at http://floridajobs.org/rebuildflorida/businessrecovery

2. Florida Tax Extensions.

o On March 26, 2020, the Florida Department of Revenue issued Order of Emergency Waiver/Deviation # 20-52-DOR-002 to extend certain filing deadlines for Florida businesses. This order addresses February and March reporting periods for the following taxes and fees:

o Sales and use tax, including discretionary sales surtax
o Tourist development tax
o Solid waste fees, including new tire fee, lead-acid battery fee, dry-cleaning gross receipts, and rental car surcharge
o Prepaid wireless E911 fees

o The order waives the imposition of penalty and interest for those taxpayers who collected these taxes in February 2020 but were unable to meet the March 20 due date if the taxes are reported and remitted by March 31, 2020. Note: To meet the March 31 deadline, electronic payments must have been initiated by 5:00 p.m. ET on March 30, 2020.
o The order states taxpayers not adversely affected by the COVID-19 outbreak are required to continue to file and pay taxes collected during March 2020 on or before April 20, 2020.
o For taxpayers who have been adversely affected by the COVID-19 outbreak, the order extends the due date for March 2020 returns and payments to April 30, 2020. Note: to meet the April 30 deadline, electronic payments must be initiated by 5:00 p.m. ET on April 29, 2020.
o Information from Florida. More detailed information is available from the Florida Department of Revenue at https://floridarevenue.com/taxes/Pages/taxpayerInfoCovid19.aspx

About Duane Morris:

For Further Information:

If you have any questions about this Alert, please contact Brad Molotsky, Crist Sanchez, Jay Steinman or any member of the COVID-19 Strategy Team or the attorney in the firm with whom you are regularly in contact.

April 18, 2020April 20, 2020 by Brad A. Molotsky

Overview of Federal and State COVID-19 Relief Programs for New York

In response to the COVID-19 pandemic, federal, state and local governments, through both legislative and executive action, have enacted or ordered a broad array of financial measures to mitigate the adverse economic effects experienced by businesses and nonprofit entities.

To read the full text of this Alert, which will identify and explain the economic programs established by the federal government, New York state and New York City to help businesses in New York that are experiencing financial loss due to COVID-19, please visit the firm website.

April 14, 2020June 11, 2020 by Brad A. Molotsky

COVID-19: Update to Various State Construction Closure Orders – Continued Shifting Sands as States Refine and Modify Closure Orders and Essential Business Definitions

This list is current as of April 14, 2020 (4:00 p.m. EST) and is and Update to an earlier Alert we posted on April 3rd. Please note that these closure orders are changing almost daily so please make sure you are checking the applicable state in question when considering a closure question:

California:

California ordered that all workers must stay home, except workers deemed “Essential Critical Infrastructure Workers.”

Generally, construction workers are “essential” to critical infrastructure. Therefore, construction companies may continue to operate and construction workers may go to work.

Specifically designated as essential are:

• Workers who support the operation, inspection and maintenance of essential public works facilities and operations, including bridges, water and sewer main breaks, fleet maintenance personnel, construction of critical or strategic infrastructure, construction material suppliers, traffic signal maintenance, emergency location services for buried utilities, maintenance of digital systems infrastructure supporting public works operations and other emergent issues;
• Engineers, technicians and associated personnel responsible for infrastructure construction and restoration, including contractors for construction and engineering of fiber optic cables;
• Construction workers who support the construction, operation, inspection and maintenance of construction sites and construction projects (including housing construction);
• Workers such as plumbers, electricians, exterminators and other service providers who provide services that are necessary to maintaining the safety, sanitation, construction material sources and essential operation of construction sites and construction projects (including those that support such projects to ensure the availability of needed facilities, transportation, energy and communications; and support to ensure the effective removal, storage and disposal of solid waste and hazardous waste).

Los Angeles, San Francisco and San Diego:

These cities in California have each taken separate positions. Some have a more limited view of which construction is essential (e.g., San Francisco) and as such permit construction to remain operational in narrow circumstances, which is at odds with the state’s position on construction. Care should be taken in these cities to evaluate the state executive order in the context of city orders, noting that in most cases the more restrictive interpretation is likely to rule the day.

Delaware:

Delaware ordered the closure of all nonessential businesses.

Construction, however has been deemed to be an “essential” category. Therefore, construction companies may continue to operate and construction workers may go to work.

Specifically designated as essential in the order are:

• Workers who support the operation, inspection and maintenance of essential public works facilities and operations, including bridges, water and sewer main breaks, fleet maintenance personnel, construction of critical or strategic infrastructure, traffic signal maintenance, emergency location services for buried utilities, maintenance of digital systems infrastructure supporting public works operations and other emergent issues;
• Engineers, technicians and associated personnel responsible for infrastructure construction and restoration, including contractors for construction and engineering of fiber optic cables.
• Workers who are engaged in the construction of residential and nonresidential structures or infrastructure, and any workers who provide critical maintenance to residential or nonresidential structures;
• Businesses that supply materials and hardware to those engaged in the construction of residential or nonresidential structures;
• Workers involved in activities related to the design and apportionment of residential and nonresidential structures.

Washington, D.C.:

Washington, D.C., ordered the closure of all nonessential businesses except for “Minimum Basic Operations.”

“Construction and Building Trades” are, however, classified as “Essential Businesses” per the order. Therefore, construction companies may continue to operate.

The order specifically includes the following as essential under that category: plumbers, pipefitters, steamfitters, electricians, boilermakers, exterminators, roofers, carpenters, bricklayers, welders, elevator mechanics, businesses that sell supplies and materials for maintenance of commercial and residential buildings and homes, including “big box” supply stores, plumbing distributors, electrical distributors, HVAC distributors and other businesses that provide services that are necessary to maintaining the safety, sanitation and operations of residences and essential businesses.

Florida:

Florida ordered the closure of all nonessential businesses. Florida has also ordered that all residents stay home unless leaving to perform an “essential services or conduct essential activities.”

Essential services includes the list detailed in the CISA Guidance, which was attached to the order, as well as businesses and activities designated essential by Miami-Dade County (see below). The state published a list of services deemed essential per the order.

The list includes:

• Workers who support construction in the petroleum, electricity, and energy industries;
• Workers who support the operation, inspection, and maintenance of essential public works facilities and operations, including bridges, water and sewer main breaks, fleet maintenance personnel, construction of critical or strategic infrastructure, traffic signal maintenance, emergency location services for buried utilities, maintenance of digital systems infrastructure supporting public works operations, and other emergent issues;
• Workers such as plumbers, electricians, exterminators, builders, contractors, HVAC Technicians, landscapers, pool care service providers, and other service providers who provide services that are necessary to maintaining the safety, sanitation, and essential operation of residences, businesses and buildings such as hospitals, senior living facilities, any temporary construction required to support COVID-19 response;
• Engineers, technicians and associated personnel responsible for infrastructure construction and restoration, including contractors for construction and engineering of fiber optic cables, buried conduit, small cells, other wireless facilities, and other communications sector-related infrastructure. This includes construction of new facilities and deployment of new technology as these are required to address congestion or customer usage due to unprecedented use of remote services;
• Suppliers, designers, transporters and other workers supporting the manufacture, distribution and provision and construction of essential global, national and local infrastructure for computing services (including cloud computing services and telework capabilities), business infrastructure, financial transactions/services, web-based services, and critical manufacturing;
• Workers supporting essential maintenance, manufacturing, design, operation, inspection, security, and construction for essential products, services, and supply chain and COVID 19 relief efforts;
• Workers performing housing construction related activities to ensure additional units can be made available to combat the nation’s existing housing supply shortage; and
• Workers supporting the construction of housing.
Generally, construction appears to be an essential business, but not all types of construction. Therefore, construction businesses should evaluate projects on a case-by-case basis.

Miami:

Miami has ordered that all nonessential retail and commercial establishments close.

The following, among other industries, have been deemed essential:

• Open construction sites, irrespective of the type of building;
• Architectural, engineering or land surveying services;
• Contractors and other tradesmen who provide services that are necessary to maintaining the safety, sanitation and essential operation of residences and other structures.

Generally, construction appears to be an essential business, but not all types of construction. Though open construction sites may remain open, the Miami-Dade order does not specifically include construction that has not yet commenced, except for specific purposes. Therefore, construction businesses should evaluate projects on a case-by-case basis.

Georgia:

Georgia ordered the closure of all businesses that are not “critical infrastructure” except for minimal basic operations. The state has also ordered that all residents stay home unless conducting or participating in “essential services.”

“Critical infrastructure” refers to businesses defined as “essential critical infrastructure workforce” per the CISA Guidance. As explained above, many construction activities have been deemed to be “essential” per CISA and in general, construction and construction supply companies may continue operations. However, construction businesses should evaluate projects on a case-by-case basis.

Atlanta:

Atlanta has ordered that all nonessential businesses close and that residents of Atlanta stay at home unless engaging in essential activities. One exception is for residents to leave to “work for essential businesses.”
Construction was deemed essential infrastructure per the Atlanta order, but the state’s order preempts the Atlanta order. Construction businesses should follow state guidance.

Illinois:

Illinois ordered the closure of all nonessential businesses. Illinois has also ordered that all residents stay home unless leaving to perform an “essential function.”

The order categorizes construction as essential infrastructure. Therefore, construction companies may continue to operate and construction workers may go to work.

It specifically includes, but is not limited to: construction required in response to this public health emergency, hospital construction, construction of long-term care facilities, public works construction and housing construction.

Chicago:

Chicago joined in the announcement of the statewide order, which is more expansive and preempts its local orders.

Maryland:

Maryland ordered the closure of all nonessential businesses that are not part of the critical infrastructure sectors identified by the CISA guidance.

The Maryland Office of Legal Counsel published interpretive guidance, which includes “commercial and residential construction companies” in the list of businesses that are not required to close under the category of commercial facilities. Therefore, construction companies may continue to operate.

Massachusetts:

Massachusetts ordered the closure of all nonessential businesses.

Generally, construction is “essential” to critical infrastructure and construction companies may continue to operate.

Specifically designated as essential are:

• Construction workers who support the construction, operation, inspection, and maintenance of construction sites and construction projects (including housing construction);
• Workers who support the operation, inspection, and maintenance of essential public works facilities and operations, including roads and bridges, water and sewer main breaks, fleet maintenance personnel, construction of critical or strategic infrastructure, traffic signal maintenance, emergency location services for buried utilities, maintenance of digital systems infrastructure supporting public works operations and other emergent issues;
• Workers―including contracted vendors―involved in the construction of critical or strategic infrastructure including public works construction, airport operations, water, sewer, gas, electrical, nuclear, oil refining and other critical energy services, roads and highways, public transportation, solid waste collection and removal, and interne, and telecommunications systems (including the provision of essential global, national, and local infrastructure for computing services);
• Workers such as plumbers, electricians, exterminators, inspectors and other service providers who provide services that are necessary to maintaining the safety, sanitation, and essential operation of residences, construction sites and projects, and needed facilities;
• Engineers, technicians and associated personnel responsible for infrastructure construction and restoration, including contractors for construction and engineering of fiber optic cables.

Boston:

Boston suspended all regular activity at construction sites.
Boston provided the following guidance:

• Employers should maintain the necessary crews to keep their sites safe and secure, keep any materials from blowing away, and prevent trespassing.
• After sites have been secured, skeleton crews will be permitted for the remainder of this suspension to ensure safety.
• The only work that will be permitted moving forward will be emergency work, which will need to be approved by the city’s Inspectional Services Department.

That essential work includes:

• Emergency utility, road or building work, such as gas leaks, water leaks and sinkholes;
• New utility connections to occupied buildings;
• Mandated building or utility work;
• Work at public health facilities, healthcare facilities, shelters, including temporary shelters and other facilities that support vulnerable populations;
• Work which ensures the reliability of the transportation network, and
• Other work necessary to render occupied residential buildings fully habitable.

Boston has a process to review requests for exceptions to the temporary construction moratorium. The Commissioner of Inspectional Services for building-related work or the Commissioner of Public Works for street-related work will grant exceptions if the construction will support increased public health and safety.

The Massachusetts order specifically supersedes any local order that interferes with the continued operations of COVID-19 Essential Services, and therefore likely preempts Boston’s suspension.

Nevada:

Nevada ordered the closure of “nonessential” businesses that either “promote recreational gatherings” or “promote extended periods of public interaction where risk of transmission is high.” The state also ordered all resident to stay home, subject to certain exceptions, which include performing work for Essential Infrastructure.

The order specifically permits the construction labor force to continue operating, with social distancing measures.

Las Vegas:

Las Vegas listed construction as an essential business, per the governor’s order.

New Jersey:

New Jersey ordered the closure of all nonessential construction.

“Essential construction projects” are defined as:

• Projects necessary for the delivery of health care services, including but not limited to hospitals, other health care facilities, and pharmaceutical manufacturing facilities;
• Transportation projects, including roads, bridges, and mass transit facilities or physical infrastructure, including work done at airports or seaports;
• Utility projects, including those necessary for energy and electricity production and transmission, and any decommissioning of facilities used for electricity generation;
• Residential projects that are exclusively designated as affordable housing;
• Projects involving pre-K-12 schools, including but not limited to projects in Schools Development Authority districts, and projects involving higher education facilities;
• Projects already underway involving individual single-family homes, or an individual apartment unit where an individual already resides, with a construction crew of 5 or fewer individuals. This includes additions to single-family homes such as solar panels;
• Projects already underway involving a residential unit for which a tenant or buyer has already entered into a legally binding agreement to occupy the unit by a certain date, and construction is necessary to ensure the unit’s availability by that date;
• Projects involving facilities at which any one or more of the following takes place: the manufacture, distribution, storage, or servicing of goods or products that are sold by online retail businesses or essential retail businesses, as defined by Executive Order No. 107 (2020) and subsequent Administrative Orders adopted pursuant to that Order;
• Projects involving data centers or facilities that are critical to a business’s ability to function;
• Projects necessary for the delivery of essential social services, including homeless shelters;
• Any project necessary to support law enforcement agencies or first responder units in their response to the COVID-19 emergency;
• Any project that is ordered or contracted for by Federal, State, county, or municipal government, or any project that must be completed to meet a deadline established by the Federal government;
• Any work on a non-essential construction project that is required to physically secure the site of the project, ensure the structural integrity of any buildings on the site, abate any hazards that would exist on the site if the construction were to remain in its current condition, remediate a site, or otherwise ensure that the site and any buildings therein are appropriately protected and safe during the suspension of the project; and
• Any emergency repairs necessary to ensure the health and safety of residents.

Though essential construction is broadly defined, not all types of construction are included. Therefore, construction businesses should evaluate projects on a case-by-case basis.

New York:

New York ordered the closure of all nonessential businesses. Initial guidance categorized construction as essential, but the state has since updated the guidance twice, narrowing the type of construction that is essential.

The most recent modification on April 9 and states that all non-essential construction must safely shut down, except emergency construction, (e.g. a project necessary to protect health and safety of the occupants, or to continue a project if it would be unsafe to allow to remain undone, but only to the point that it is safe to suspend work).

Essential construction may proceed, to the extent that:

• the construction is for, or your business supports, roads, bridges, transit facilities, utilities, hospitals or healthcare facilities, homeless shelters, or public or private schools;
• the construction is for affordable housing, as defined as construction work where either (i) a minimum of 20% of the residential units are or will be deemed affordable and are or will be subject to a regulatory agreement and/or a declaration from a local, state, or federal government agency or (ii) where the project is being undertaken by, or on behalf of, a public housing authority;
• the construction is necessary to protect the health and safety of occupants of a structure;
• the construction is necessary to continue a project if allowing the project to remain undone would be unsafe, provided that the construction must be shut down when it is safe to do so;
• the construction is for projects in the energy industry in accordance with Question No. 14 in the FAQ at: https://esd.ny.gov/sites/default/files/ESD_EssentialEmployerFAQ_033120.pdf;
• the construction is for existing (i.e. currently underway) projects of an essential business; or
• the construction work is being completed by a single worker who is the sole employee/worker on the job site.

At every site, it is required that the personnel working on the site maintain an appropriate social distance. Sites that cannot maintain appropriate social distancing, as well as cleaning/disinfecting protocols must close.

Enforcement will be conducted by state and local governments, including fines up to $10,000 per violation.
Construction may continue solely with respect to those employees that must be present at the business location/construction site in support of essential business activities. No other employees/personnel shall be permitted to work in-person at the business location/construction site. Any other business activities being completed that are not essential are still subject to the restrictions provided by Executive Order 202.

As noted above, local governments, including municipalities and school districts, are allowed to continue construction projects at this time as government entities are exempt from these essential business restrictions. However, to the greatest extent possible, local governments should postpone any non-essential projects and only proceed with essential projects when they can implement appropriate social distancing and cleaning/disinfecting protocols. Essential projects should be considered those that have a nexus to health and safety of the building occupants or to support the broader essential services that are required to fulfill the critical operations of government or the emergency response to the COVID-19 public health crisis.

New York City:

The city has adopted the governor’s order. The New York City Department of Buildings issued guidance to owners and contractors regarding enforcement of essential versus nonessential construction in accordance with the order. The guidance was issued prior to the April 9 state guidance update, but appears to still be in effect.

Per the guidance, only the following projects will be permitted by the New York City Department of Buildings until further notice:

Emergency construction:

1. Project necessary to protect the health and safety of the occupants:
a. Emergency work ordered by the New York City Department of Buildings;
b. Restoration of essential services – heat, hot water, cold water, gas, electricity or other utility services; or
c. Work necessary to address any condition requiring immediate corrective action that severely affects life, health, safety, property or significant number of persons.

2. Project required to continue to the extent it would be unsafe to allow work to remain undone. Such projects may continue only until it is safe to shut the site.

Essential construction:

1. Utilities;
2. Hospitals or healthcare facilities;
3. Transitional and/or homeless shelters;
4. Affordable housing: Construction work on public housing, or a private or multiple dwelling or real property that is a new building (NB) or that is 100 percent vacant; or is work on unoccupied public housing units for the designation as housing for specific populations (i.e., shelter set aside, domestic violence referrals), or work on the exterior to address emergency conditions requiring immediate corrective action, set forth in Section 1(a)(iii) or within public housing, correction of critical systems for seasonal preparedness for the 2020-2021 heating season of an existing public housing building. Construction work on a private or multiple dwelling or real property that is a new building or that is 100 percent vacant that is now used or will be converted to such use: (i) For the provision of affordable inclusionary housing or mandatory inclusionary housing pursuant to the New York City zoning resolution; or (ii) Where no less than 30 percent of the residential units are subject to a regulatory agreement, restrictive declaration, or similar instrument with a local, state or federal governmental entity or a local housing authority in a city with a population of one million or more.
5. Other essential construction as approved by the New York City Department of Buildings.
Solo work- Work that is limited to a single worker, who is the sole employee/worker on a job site.

Pennsylvania:

Pennsylvania has ordered the closure of all non-life-sustaining businesses. The state has also ordered all residents to stay home, unless supporting a life-sustaining business.

Construction, as a general category, is not “life-sustaining” per Pennsylvania’s published list of industry types. The state is permitting construction, but only for emergency repairs and for building healthcare facilities. Therefore, construction companies may not operate unless they fall under an exception or obtain a waiver from the state.

Philadelphia:

The state’s order preempts all prior Philadelphia orders, and therefore construction companies may not operate unless they fall under an exception or obtain a waiver from the state.

Texas:

Texas has closed only bars, dining establishments and gyms. Therefore, construction companies may continue to operate.

Various localities in Texas have enacted expansive business restrictions. As with all states, it is important to analyze local law to determine if there are restrictions for business operations.

Virginia:

Virginia has only ordered the closure of specific types of retail, recreational and entertainment businesses.

Therefore, construction companies may continue to operate.

About Duane Morris:

Duane Morris has created a COVID-19 Strategy Team to help organizations plan, respond to and address this fast-moving situation. Please see our COVID-19 site or contact your Duane Morris attorney for more information. Prior Alerts are available on the team’s webpage.

For Further Information:

If you have any questions about this Alert, please contact Brad A. Molotsky, Elizabeth Mincer or any member of our COVID-19 Strategy Team or the attorney in the firm with whom you are regularly in contact.

April 13, 2020 by Brad A. Molotsky

COVID-19: NJ extends GROW NJ, ERG and HUB Filing Deadlines

The New Jersey Economic Development Authority (NJEDA) has extended the annual reporting deadlines for businesses that received tax credits through the Grow New Jersey, Economic Redevelopment & Growth (ERG) and Urban Transit Hub (HUB) programs because of the impact of COVID-19, the EDA announced on April 13, 2020.

Per NJEDA’s announcement, under the extension, annual reports will be due 90 days after the EDA notifies businesses the restrictions imposed by Gov. Phil Murphy’s statewide stay-at-home order issued March 21 are no longer in effect.

Under existing rules for the Grow NJ and HUB programs, award recipients were required to submit an annual report 120 days after the end of the relevant tax period. Failure to submit the relevant report in a timely fashion results in forfeiture of the tax credit for that tax period.

Similarly, residential and mixed-use parking ERG approval letters require an annual report for a developer’s tax period within 120 days after the end of the tax period. Failure to submit this report in timely fashion results in the forfeiture of the tax credits for that tax period.

Per NJEDA, the ability to file on a timely basis was impacted last month, when Governor Murphy — through Executive Order 107 — announced the closure of all non-essential retail business, requiring all employers to offer work-form-home wherever practicable and directing all residents to abide by social distancing practices. The Governor has since announced subsequent containment measures.

About Duane Morris:

For Further Information:

If you have any questions about this Alert, please contact Brad A. Molotsky, Paul Josephson, or any member of our COVID-19 Strategy Team or the attorney in the firm with whom you are regularly in contact.

April 9, 2020April 9, 2020 by Brad A. Molotsky

COVID-19: New York Issues Updated Guidance on the definition of “Essential Business” and “Non-Essential Business” – Executive Order 202.6

On April 9, the Governor issued and updated Executive Order (202.6) to provide further guidance on determining whether a business is “Essential” (and thereby permitted to operate) or “Non-Essential” (and, thereby NOT permitted to operate).

ESSENTIAL BUSINESSES OR ENTITIES, including any for-profit or non-profit, regardless of the nature of the service, the function they perform, or its corporate or entity structure, are NOT subject to the in-person restriction. Essential Businesses must continue to comply with the guidance and directives for maintaining a clean and safe work environment issued by the Department of Health (DOH) and every business, even if essential, is strongly urged to maintain social distancing measures to the extent possible.

This guidance is issued by the New York State Department of Economic Development d/b/a Empire State Development (ESD) and applies to each business location individually and is intended to assist businesses in determining whether they are an essential business.

With respect to business or entities that operate or provide both essential and non-essential services, supplies or support, only those lines and/or business operations that are necessary to support the essential services, supplies, or support are exempt from the workforce reduction restrictions.

State and local governments, including municipalities, authorities, and school districts, are exempt from these essential business reductions, but are subject to other provisions that restrict non-essential, in-person workforce and other operations under Executive Order 202.

For purposes of Executive Order 202.6, “Essential Business,” shall mean businesses operating in or as:

1. Essential health care operations including:

research and laboratory services
hospitals
walk-in-care health clinics and facilities
emergency veterinary, livestock medical services
senior/elder care
medical wholesale and distribution
home health care workers or aides for the elderly
doctor and emergency dental
nursing homes, residential health care facilities, or congregate care facilities
medical supplies and equipment manufacturers and providers
licensed mental health providers
licensed substance abuse treatment providers
medical billing support personnel
emergency chiropractic services
physical therapy, prescribed by medical professional
occupational therapy, prescribed by medical professional

2. Essential infrastructure including:

public and private utilities including but not limited to power generation, fuel supply, and transmission
public water and wastewater
telecommunications and data centers
airlines/airports
commercial shipping vessels/ports and seaports
transportation infrastructure such as bus, rail, for-hire vehicles, garages
hotels, and other places of accommodation

3. Essential manufacturing including

food processing, manufacturing agents including all foods and beverages
chemicals
medical equipment/instruments
pharmaceuticals
sanitary products including personal care products regulated by the Food and Drug Administration (FDA)
telecommunications
microelectronics/semi-conductor
food-producing agriculture/farms
household paper products
defense industry and the transportation infrastructure
automobiles
any parts or components necessary for essential products that are referenced within this guidance

4. Essential retail including:

grocery stores including all food and beverage stores
pharmacies
convenience stores
farmer’s markets
gas stations
restaurants/bars (but only for take-out/delivery)
hardware, appliance, and building material stores
pet food
telecommunications to service existing customers and accounts
delivery for orders placed remotely via phone or online at non-essential retail establishments; provided, however, that only one employee is physically present at the business location to fulfill orders

5. Essential services including:

trash and recycling collection, processing, and disposal
mail and shipping services
laundromats and other clothing/fabric cleaning services
building cleaning and maintenance
child care services
bicycle repair
auto repair
automotive sales conducted remotely or electronically, with in-person vehicle return and delivery by appointment only
marine vessel repair and marinas, but only to support government or essential commercial operations and not for recreational purposes
warehouse/distribution and fulfillment
funeral homes, crematoriums and cemeteries
storage for essential businesses
maintenance for the infrastructure of the facility or to maintain or safeguard materials or products therein
animal shelters and animal care including dog walking, animal boarding
landscaping, but only for maintenance or pest control and not cosmetic purposes
designing, printing, publishing and signage companies to the extent that they support essential businesses or services
remote instruction or streaming of classes from public or private schools or health/fitness centers; provided, however, that no in-person congregate classes are permitted

6. The news media

7. Financial Institutions including:

banks or lending institution
insurance
payroll
accounting
services related to financial markets, except debt collection

8. Providers of basic necessities to economically disadvantaged populations including:

homeless shelters and congregate care facilities
food banks
human services providers whose function includes the direct care of patients in state-licensed or funded voluntary programs; the care, protection, custody and oversight of individuals both in the community and in state-licensed residential facilities; those operating community shelters and other critical human services agencies providing direct care or support

9. Construction:

All non-essential construction must safely shut down, except emergency construction, (e.g. a project necessary to protect health and safety of the occupants, or to continue a project if it would be unsafe to allow to remain undone, but only to the point that it is safe to suspend work).

Essential construction may proceed, to the extent that:

the construction is for, or your business supports, roads, bridges, transit facilities, utilities, hospitals or healthcare facilities, homeless shelters, or public or private schools;

the construction is for affordable housing, as defined as construction work where either (i) a minimum of 20% of the residential units are or will be deemed affordable and are or will be subject to a regulatory agreement and/or a declaration from a local, state, or federal government agency or (ii) where the project is being undertaken by, or on behalf of, a public housing authority;

the construction is necessary to protect the health and safety of occupants of a structure;

the construction is necessary to continue a project if allowing the project to remain undone would be unsafe, provided that the construction must be shut down when it is safe to do so;

the construction is for projects in the energy industry in accordance with Question No. 14 in the FAQ at: https://esd.ny.gov/sites/default/files/ESD_EssentialEmployerFAQ_033120.pdf;

the construction is for existing (i.e. currently underway) projects of an essential business; or

the construction work is being completed by a single worker who is the sole employee/worker on the job site.

At every site, it is required that the personnel working on the site maintain an appropriate social distance, including for purposes of elevators/meals/entry and exits. Sites that cannot maintain appropriate social distancing, as well as cleaning/disinfecting protocols must close. Enforcement will be conducted by state and local governments, including fines up to $10,000 per violation.

Construction may continue solely with respect to those employees that must be present at the business location/construction site in support of essential business activities. No other employees/personnel shall be permitted to work in-person at the business location/construction site. Any other business activities being completed that are not essential are still subject to the restrictions provided by Executive Order 202.

10. Defense – defense and national security-related operations supporting the U.S. Government or a contractor to the US government

11. Essential services necessary to maintain the safety, sanitation and essential operations of residences or other businesses including:

law enforcement, including corrections and community supervision
fire prevention and response
building code enforcement
security
emergency management and response, EMS and 911 dispatch
building cleaners or janitors
general maintenance whether employed by the entity directly or a vendor
automotive repair
disinfection
residential moving services

12. Vendors that provide essential services or products, including logistics and technology support, child care and services including, but not limited to:

logistics
technology support for online services
child care programs and services
government owned or leased buildings
essential government services
any personnel necessary for online or distance learning or classes delivered via remote means

13. Recreation

Parks and other open public spaces, except playgrounds and other areas of congregation where social distancing cannot be abided

However, golf courses are not essential and the use of boat launches and marinas for recreational vessels are not considered essential

14. Professional services with extensive restrictions

Lawyers may continue to perform all work necessary for any service so long as it is performed remotely. Any in-person work presence shall be limited to work only in support of essential businesses or services; however, even work in support of an essential business or service should be conducted as remotely as possible.

Real estate services shall be conducted remotely for all transactions, including but not limited to title searches, appraisals, permitting, inspections, and the recordation, legal, financial and other services necessary to complete a transfer of real property; provided, however, that any services and parts therein may be conducted in-person only to the extent legally necessary and in accordance with appropriate social distancing and

cleaning/disinfecting protocols; and nothing within this provision should be construed to allow brokerage and branch offices to remain open to the general public (i.e. not clients).

Pursuant to Executive Order 202.10, all non-essential gatherings of individuals of any size for any reasons (e.g. worship services, parties, celebrations, or other social events) are canceled or postponed.

Congregate services within houses of worship are prohibited. Houses of worship may only be used by individuals and only where appropriate social distancing of, at least, six feet between people can be maintained. Further, individuals should not gather in houses of worship, homes, or other locations for religious services until the end of this public health emergency. If possible, religious leaders should consider alternative forms of worship, replacing in-person gatherings with virtual services, such as phone or conference calls, videoconference calls, or online streaming.

If the function of your business is not listed, but you believe that it is essential or it is an entity providing essential services or functions, the guidance allows you to request designation as an essential business.

Note, however, that pursuant to the Governor’s Executive Orders, the following businesses are specifically enumerated as non-essential and are, therefore, unable to request a designation:

Any large gathering or event venues, including but not limited to establishments that host concerts, conferences, or other in-person performances or presentations in front of an in-person audience;

Any dine-in or on-premise restaurant or bar service, excluding take-out or delivery for off-premise consumption;

Any facility authorized to conduct video lottery gaming or casino gaming;

Any gym, fitness centers, or exercise classes, except the remote or streaming service noted above;

Any movie theater;

Any indoor common portions of retail shopping malls with 100,000 or more square feet of retail space available for lease;

All places of public amusement, whether indoors or outdoors, including but not limited to, locations with amusement rides, carnivals, amusement parks, water parks, aquariums, zoos, arcades, fairs, children’s play centers, funplexes, theme parks, bowling alleys, family and children’s attractions; and

Any barbershops, hair salons, tattoo or piercing parlors and related personal care services, including nail technicians, cosmetologists and estheticians, and the provision of electrolysis, laser hair removal services.

About Duane Morris:

For Further Information:

If you have any questions about this Alert, please contact Brad A. Molotsky, Meghan DiPerna, Ken Lazaruk, Elizabeth Mincer, or any member of our COVID-19 Strategy Team or the attorney in the firm with whom you are regularly in contact.

April 8, 2020June 11, 2020 by Brad A. Molotsky

COVID-19 – NJ updates its Executive Order – “Non-Essential” Construction Activity Shut Down and Retail Limitations – effective April 8th – 8PM

Governor Murphy announced on Wednesday, April 8, 2020, an Executive Order (“EO”) that will impact business operations across the State of New Jersey. A copy of the Executive Order can be found at: https://nj.gov/infobank/eo/056murphy/pdf/EO-122.pdf

New Guidelines for “Non-Essential Construction“:

Per the EO, all non-essential construction operations in NJ must be shut down at 8 PM on 4-10-2020. Below is the definition for “essential construction” that may remain operational. The EO also requires construction projects that remain active to adopt special social distancing and cleanliness standards.

Projects necessary for the delivery of health care services, including but not limited to hospitals, other health care facilities, and pharmaceutical manufacturing facilities;
Transportation projects, including roads, bridges, and mass transit facilities or physical infrastructure, including work done at airports or seaports;
Utility projects, including those necessary for energy and electricity production and transmission, and any decommissioning of facilities used for electricity generation;
Residential projects that are exclusively designated as affordable housing;
Projects involving pre-K-12 schools, including but not limited to projects in Schools Development Authority districts, and projects involving higher education facilities;
Projects already underway involving individual single-family homes, or an individual apartment unit where an individual already resides, with a construction crew of 5 or fewer individuals. This includes additions to single-family homes such as solar panels;
Projects already underway involving a residential unit for which a tenant or buyer has already entered into a legally binding agreement to occupy the unit by a certain date, and construction is necessary to ensure the unit’s availability by that date;
Projects involving facilities at which any one or more of the following takes place: the manufacture, distribution, storage, or servicing of goods or products that are sold by online retail businesses or essential retail businesses, as defined by Executive Order No. 107 (2020) and subsequent Administrative Orders adopted pursuant to that Order;
Projects involving data centers or facilities that are critical to a business’s ability to function;
Projects necessary for the delivery of essential social services, including homeless shelters;
Any project necessary to support law enforcement agencies or first responder units in their response to the COVID-19 emergency;
Any project that is ordered or contracted for by Federal, State, county, or municipal government, or any project that must be completed to meet a deadline established by the Federal government;
Any work on a non-essential construction project that is required to physically secure the site of the project, ensure the structural integrity of any buildings on the site, abate any hazards that would exist on the site if the construction were to remain in its current condition, remediate a site, or otherwise ensure that the site and any buildings therein are appropriately protected and safe during the suspension of the project; and
Any emergency repairs necessary to ensure the health and safety of residents.

New Guidelines for Essential Retail Stores:

All essential retail must indefinitely limit the number of customers in their stores to 50 percent of their approved capacity.Customers and employees must wear face coverings. Stores must provide special shopping hours for high-risk individuals, erect physical barriers between customers and cashiers and baggers where practicable, and regularly sanitize areas used by their employees.

New Guidelines for Warehouses and Manufacturing Facilities:

The order will also put greater protections in place for the workers in warehouses and in manufacturing and will required social distancing to be practiced to its fullest extent.

About Duane Morris:

For Further Information:

If you have any questions about this Alert, please contact Brad A. Molotsky, Paul Josephson, Elizabeth Mincer, James Greenberg, or any member of our COVID-19 Strategy Team or the attorney in the firm with whom you are regularly in contact.

April 4, 2020April 6, 2020 by Brad A. Molotsky

NJ: NJEDA Announces April 13th – Application Launch Date for Loan Program for Small Businesses impacted by COVID-19

The New Jersey Economic Development Authority (NJEDA) will launch the application for its Small Business Emergency Assistance Loan Program on Monday, April 13, 2020 at 9:00 am. A link to the program application will be posted on the State’s COVID-19 Business Information Hub. To provide business owners the opportunity to prepare to apply for the loan, a .pdf version of the application will become available on Monday, April 6^th. The loan program is part of a package of initiatives announced last week to support businesses and workers facing economic hardship due to the outbreak of the novel coronavirus COVID-19.

A copy of the loan application will be available Monday, April 6, 2020, to provide business owners with the opportunity to prepare. Completed applications will be considered on a first come, first serve rolling basis. To see whether you might qualify for this program, use the NJ COVID-19 Business Support Eligibility Wizard.

The Small Business Emergency Assistance Loan program is designed to provide a direct loan of up to $100,000 to NJ-based small businesses and non-profits organizations that have been in existence for at least one-year and has less than $5 million in annual revenue. These businesses much have been negatively impacted by the COVID-19 outbreak (including, but not limited to: reduction of business hours, complete closure of business, at least a 20% decline in revenue, employees unable to work, required to close by government, or disruption of supply chain).

Your organization is eligible for the Small Business Emergency Assistance Loan Program if you…

Have a physical commercial location in the State of NJ. Home-based businesses are not eligible for this program. A home-based business is a business operated out of a residential property where commercial activity is not zoned to take place.
Have been in existence for at least one year
Have less than $5M annual revenue
Can show a global debt service coverage ratio of 1.00 (as of December 31st, 2019)
Are able to demonstrate negative impact related to COVID-19 on or after March 9th, 2020
Are registered to do business in the State of NJ
Must certify that the company is in good tax standing with the State
Are in good standing with the Department of Labor and Workforce Development, with all decisions of good standing at the discretion of the Commissioner of the Department of Labor and Workforce Development
Are able to provide a CEO certification that the firm will make its best-effort to not lay off employees or will re-hire employees as soon as possible
Non-profit organizations are eligible for this program; eligible non-profits must have status of 501(c)(3), 501(c)(4), 501(c)(7)

Types of businesses not eligible:

Related to gambling or gaming activities
Related to the purveyance of “adult” (i.e., pornographic, lewd, prurient, obscene) activities, services, products or materials (including nude or semi-nude performances or the sale of sexual aids or devices)
Auction or bankruptcy or fire or “lost-our-lease” or “going-out-of-business” or similar sale
Traveling merchant
Christmas tree sales or other outdoor storage
Any other activity constituting a nuisance
Illegal under the laws of the State of New Jersey

This program is structured specifically for entities facing economic challenges due to COVID-19 and provides low-cost and flexible terms, such as:

10-year term and amortization
0% interest rate (years 1-5), NJEDA’s prevailing interest rate floor (capped at 3.0% years 6-10)
Deferred repayments for 12 months

There are no fees associated with the Small Business Emergency Loan Program for the first five years of the loan, including application fees, and then standard modification fees will apply.

About Duane Morris:

For Further Information:

If you have any questions about this Alert, please contact Brad A. Molotsky, James Greenberg, Dan Mita or any member of our COVID-19 Strategy Team or the attorney in the firm with whom you are regularly in contact.