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NJ’s Response: Business Assistance and COVID – 19
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.
This Alert identifies and provides an overview of available economic programs, tax relief measures, and deadline extensions for applicable Pennsylvania and Philadelphia organizations effected by the COVID-19 pandemic and closures:
1. Economic Programs: Grants and Loans
a. Small Business Administration (SBA) Economic Injury Disaster Loan Program (EIDL).
i. Overview: Federal Disaster Loans to small businesses or private, non-profit organizations that suffer substantial economic injury as a result of the declared disaster, regardless of whether the entity sustained physical damage;
ii. Loan Amount: Up to $2 million;
iii. Interest Rate: Not exceed 4 percent per year;
iv. Term: Determined by applicant’s ability to repay the loan; and
v. Other: No upfront fees or early payment penalties charged by SBA. The disaster loan program is the only form of SBA assistance not limited to small businesses.
vi. More Information: Please see our more comprehensive Alert on this particular program at: https://www.duanemorris.com/alerts/small_business_administration_offers_economic_injury_disaster_loans_0320.html or
https://disasterloan.sba.gov/ela/Information/EIDLLoans
2. New Jersey Programs: Please see our earlier Alert on this topic, but in summary:
A new package of initiatives from the NJEDA includes a grant program for small businesses, a zero-interest program for mid-size companies, ,support for private-sector lenders and Community Development Financial Institutions (CDFIs), funding for entrepreneurs.
a. Small Business Emergency Assistant Grant Program– A $5M program that will provide grants up to $5,000 to small businesses in retail, arts entertainment, recreation, accommodation, food service, repair, maintenance, personal and laundry services.
b. Small Business Emergency Assistance Loan Program -A $10M program that will provide working capital loans of up to $100,000 to businesses with less than $5M in revenues. 10 year terms with zero percent for first 5 years.
c. CDFI Emergency Loan Loss Reserve Fund – A $10M capital reserve fund to take a first loss position on CDFI loans.
d. CDFI Assistance Grant Program– A $1.25M program that will provide grants of up to $250,000 to scale operations or reduce interest rates.
e. NJ Entrepreneur Support Program– A $5M program to encourage continued capital flows to new companies.
f. Small Business Emergency Assistance Guarantee Program– A $10M program that will provide 50 percent guarantees on working capital loans and waive fees on loans made through institutions participating in NJEDA’s existing Premier Lender or Premier CDFI programs.
g. Emergency Technical Assistance Program– A $150,000 program that will
support technical assistance to New Jersey based companies applying for State and US SBA programs
h. NJEDA Moratorium/Loan Fee Forgiveness Program– NJEDA has approved a 3-month payment moratorium of eligible businesses on direct loans and premier participation loans, and waiving late fees on loan repayments and loan modification fees for impacted businesses.
To see more about these programs, use the NJ COVID-19 Business Support Eligibility Wizard.
3. New Jersey COVID related Legislation:
a. NJEDA Programs – Pursuant to A3845, the NJEDA has been authorized to make grants during a state of emergency or public health emergency declared by the Governor. Allows Economic Development Authority to grant certain business documentation submission deadline extensions. Please see our earlier Alert on this topic.
b. Broadband – AJR 158 Urges Federal Communications Commission to take temporary measures to secure broadband access for those affected by COVID-19.
c. Telemedicine; Health Insurance – AB 3843 Requires health insurance and Medicaid coverage for testing of coronavirus disease 2019 and for telemedicine and telehealth during coronavirus disease 2019 state of emergency.
d. School Meals – AB 3840 Requires school districts to provide school meals or meal vouchers to students eligible for free and reduced price school meals during school closures due to COVID.
e. Time Off from Work – AB 3848 Concerns time off from work in connection with infectious disease.
f. Telehealth – AB 3860 Establishes certain requirements to use telemedicine and telehealth to respond to coronavirus disease 2019 (COVID-19).
g. Specimen Collection – AB 3854 Authorized all licensed health care facilities and labs to collect specimens to test for COVID 19; allows staffing ratio waivers.
h. Retail Returns – AB 3865 Limits the return of items purchased from retail food stores during a state of emergency declared in response to COVID-19.
i. SNAP Benefits – AC 165 – Urges Department of Human Services to apply for federal waivers to facilitate and increase access to SNAP benefits during coronavirus disease 2019 outbreak.
j. Personal Protective Equipment (PPE) – Executive Order No. 109, requires any business, non-hospital health care facility, or institution of higher learning in possession of personal protective equipment (PPE), ventilators, respirators or anesthesia machines not required for the provision of critical health care services to undertake an inventory of these supplies and send the information to the State by 5:00 pm on Friday, March 27. 2020.
k. Residential Eviction Moratorium – Pursuant to Executive Order No. 106, any lessee, tenant, homeowner or any other person shall not be removed from a residential property as the result of an eviction or foreclosure proceeding. This is a 90-day eviction moratorium. This applies only to residential mortgages, not businesses, as of yet and has received the support of Citigroup, JPMorgan Chase, U.S. Bank, Wells Fargo and Bank of America.
About Duane Morris:
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 Alert, please contact James Greenberg, Sandra G. Stoneman, Brad A. Molotsky, Dan Mita or any member of the COVID-19 Strategy Team or the attorney in the firm with whom you are regularly in contact.
Be Safe. Stay Vigilant.
Construction Activity in the Covid-19 Era: Essential Activity or Non-Essential Activity?
As more and more states and localities shut down entire industries and order workers and citizens to stay home and shelter in place, many companies are asking “How does this affect my operations?” In this post, we focus on the Construction Industry and how it fits into the Federal, state and municipal mosaic of what is being defined as “essential”.
In many of the states and localities that have ordered “nonessential” industries to cease physical location, in-office or in-facility work, the orders or guidance categorize construction as essential infrastructure. Some of this is on their own volition, other States have relied or been guided by Federal Guidance that has been published by Homeland Security – Cyber and Infrastructure (“CISA”) – Essential Critical Infrastructure Workers During COVID-19 Division. This publication is commonly referred to as CISA. https://www.cisa.gov/news/2020/03/19/cisa-releases-guidance-essential-critical-infrastructure-workers-during-covid-19.
Under CISA many construction activities have been deemed to be “essential” This means that, for that States that are following CISA, in general, construction and construction supply companies may continue operations.
However, not all Executive Orders are created equal. Governors and mayors have created a patchwork of mandates to attempt to flatten the corona virus curve, and not all sectors of the construction industry have a green light to stay open and running. It is vital to carefully review Orders and associated guidance to determine how it applies to the construction industry as a whole, and specific subsections of the construction industry. Moreover, these Orders are subject to change as we saw this morning in New York state. As such, please make sure you are looking at the latest guidance that has been issued or feel free to give us a call or email to discuss your questions.
Below is a list of how California, Nevada, Delaware, Florida, Georgia, Washington, DC, Pennsylvania, Texas, Massachusetts and New Jersey are treating construction in the context of non-essential business physical closure Orders and how some specific jurisdictions such as Philadelphia, Miami, Las Vegas, Atlanta San Francisco, Los Angeles and San Diego have responded all of which directly affects construction industry operations.
*This List has been updated as of March 27, 2020, (3:15 pm EST)
Jurisdictions Direct Impact on Construction Companies and Projects
California: California ordered that all workers must stay home, except workers deemed “Essential Critical Infrastructure Workers.”
Generally, construction workers are “essential” to critical infrastructure. See Guidance. 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 view construction as essential (e.g., San Francisco) and as such permit construction to remain operational which is at odds with the State position on construction (other than as noted above) being deemed to be NON-essential. 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. See List. Therefore, construction companies may continue to operate and construction workers may go to work.
Specifically designated in the Order 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, 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, nonresidential structures, or infrastructure, and any workers who provide critical maintenance to residential or non-residential structures;
• Businesses that supply materials and hardware to those engaged in the construction of residential or non-residential structures;
• Workers involved in activities related to the design and apportionment of residential and non-residential structures.
Washington DC: 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 has closed only bars and nightclubs at the moment (note, however, given the growth of cases in the last 48 hours, this may change). See March 23 Order. Therefore, construction companies may continue to operate.
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 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 has closed only bars and nightclubs. See March 23 Order. Therefore, construction companies may continue to operate.
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 is essential infrastructure per the Order. Specifically, “individuals may leave their residence to provide any services or perform any work necessary to the operations and maintenance of ‘Essential Infrastructure,’ including, but not limited to public works, construction, airport operations, utility, water, sewer, gas, electrical, oil refining, roads and highways, railroads, public transportation … provided that they carry out those services or that work in compliance with Social Distancing Requirements as defined herein, to the extent possible.”
Therefore, construction companies may continue to operate in Atlanta.
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 Cybersecurity and Infrastructure Security Agency (“CISA”). See CISA Guidance.
As CISA guidance has been used in other states to justify construction related activities as “essential” it is likely that construction related activities will be permitted to continue in Maryland.
The Governor has ordered that all nonessential businesses close. The order defines “nonessential” as anything not part of the critical infrastructure sectors identified in the Cybersecurity and Infrastructure Security Agency’s (CISA) guidance. See attached; https://www.cisa.gov/identifying-critical-infrastructure-during-covid-19 Construction is not a specific category under CISA, but is mentioned in relation to the other categories.
The Maryland Office of Legal Counsel (OLC) published interpretive guidance. The interpretive guidance includes “commercial and residential construction companies” in the list of businesses that are not required to close under the category of Commercial Facilities.
Note: Maryland has 2x updated its list of businesses that are “essential” during the week – which list now includes title companies, engineers, architects, and nurseries. Please make sure to check these updates for your specific business.
Massachusetts: Massachusetts ordered the closure of all nonessential businesses.
Generally, construction is “essential” to critical infrastructure. See Guidance. Therefore, 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 internet, 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 of Boston’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. These may be granted by the Commissioner of Inspectional Services for building-related work or the Commissioner of Public Works for street-related work. These will be granted if they support increased public health and safety. Notwithstanding this helpful process, the Commonwealth’s Executive Order specifically overrides any municipal order to the contrary, and, as such the Governor’s Executive Order provides the critical guidance on this issue (see above – construction is generally essential).
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 Order specifically permits the construction labor force to continue operating, though it must adopt social distancing measures. Therefore, construction companies may continue to operate.
Las Vegas:
Las Vegas listed construction as an essential business, per the Governor’s Order.
New Jersey: New Jersey ordered the closure of all brick-and-mortar premises of non-essential retail businesses, as well as recreational and entertainment businesses and restaurants and bars.
New Jersey’s order does not apply to the construction industry. The state further clarified that “heavy construction” and “other commercial operations” may continue to operate, but should limit onsite staff to essential operations. Therefore, construction companies may continue to operate.
New York : New York ordered the closure of all nonessential businesses.
In general, construction is an essential industry. See Guidance. The guidance INITIALLY and specifically includes:
• Skilled trades such as electricians, plumbers;
• Other related construction firms and professionals for essential infrastructure or for emergency repair and safety purposes.
That initial guidance was modified today, March 27th : https://esd.ny.gov/guidance-executive-order-2026.
Under the revised guidance:
…9. Construction
• All non-essential construction must 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 until it is safe to shut the site).
• Essential construction may continue and includes roads, bridges, transit facilities, utilities, hospitals or health care facilities, affordable housing, and homeless shelters. At every site, if essential or emergency non-essential construction, this includes maintaining social distance, including for purposes of elevators/meals/entry and exit. Sites that cannot maintain distance and safety best practices must close and enforcement will be provided by the state in coordination with the city/local governments. This will include fines of up to $10,000 per violation.
• For purposes of this section construction work does not include a single worker, who is the sole employee/worker on a job site.
Therefore, construction companies may continue to operate but only if they fall into the above specific exempt categories.
New York City:
The city has adopted the Governor’s Order. The New York City Department of Buildings issued further guidance to owners and contractors regarding enforcement of Essential vs. Nonessential construction in accordance with the Governor’s Order.
Per the guidance, only the following projects will be permitted by the New York City Department of Buildings until further notice:
1. Emergency construction:
a. Project necessary to protect the health and safety of the occupants:
i. Emergency work ordered by the New York City Department of Buildings;
ii. Restoration of essential services – heat, hot water, cold water, gas, electricity, or other utility services; or
iii. Work necessary to address any condition requiring immediate corrective action that severely affects life, health, safety, property, or significant number of persons.
b. Project required to continue to the extent it would be unsafe to allow work to remain undone. Such project may continue only until it is safe to shut the site.
2. Essential construction:
a. Utilities;
b. Hospitals or health care facilities;
c. Transitional and/ or Homeless shelters;
d. 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% 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 (NB) or that is 100% 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% 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.
e. Other essential construction as approved by the New York City Department of Buildings.
3. 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.
Construction, as a general category, is not “life-sustaining” per Pennsylvania’s published list of industry types. See Guidance.
The state is permitting construction BUT only for emergency repairs and to construction of health care facilities. Therefore, construction companies may not operate unless they fall under an exception or obtain a waiver from the state.
Philadelphia:
Philadelphia ordered that certain businesses close and initially permitted construction through March 27th. Furthermore, Philadelphia is currently under a state-ordered stay-at-home order, but there is an exception for workers traveling to and working for life-sustaining businesses.
Texas: Texas has closed only bars, dining, and gyms. See March 19 Order. 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 recreational and entertainment businesses. See March 23 Order. Therefore, construction companies may continue to operate.
If you have any questions or concerns, please do not hesitate to contact us via email and we will call you back to discuss your concerns.
We can be reached at any of the following email addresses and will direct your inquiry to the appropriate person within our COVID Taskforce – Brad Molotsky – bamolotsky@duanemorris.com; Elizabeth Mincer – emincer@duanemorris.com; Sharon Caffrey – slcaffrey@duanemorris.com; or Dominica Anderson – dcanderson@duanemorris.com.
Be safe.
COVID-19 – White House, Senators Strike Deal on $2T Massive Stimulus Package – 3-25-2020
Early in the morning on 3-25-2020, the Trump administration struck a deal with Senate Democrats and Republicans on an historic rescue package that tees up more than $2 trillion in spending and tax breaks to bolster the hobbled U.S. economy and fund a nationwide effort to stem the coronavirus.
“At last we have a deal,” Senate Majority Leader Mitch McConnell said early Wednesday on the chamber’s floor. “I’m thrilled that we’re finally going to deliver to the country.” Senate Democratic leader Chuck Schumer called it an “outstanding agreement.”
The legislation was still being drafted but McConnell said the Senate would vote on it Wednesday. It would still have to pass in the House before it gets to President Donald Trump’s desk. House Speaker Nancy Pelosi had consulted with Schumer throughout his negotiations with Treasury Secretary Steven Mnuchin.
The plan includes about $500 billion that can be used to back loans and assistance to companies, including $50 billion for loans to U.S. airlines, as well as state and local governments. It also has more than $350 billion to aid small businesses. Then there is $150 billion for hospitals and other health-care providers for equipment and supplies.
Direct Payments:
For individuals the package provides direct payments to lower- and middle-income Americans of $1,200 for each adult, as well as $500 for each child. Unemployment insurance would be extended to four months, the benefits would be bolstered by $600 weekly, and eligibility would be expanded to cover more workers.
Democrats demanded and won a series of restraints on corporations that would benefit from loans or investments from the Treasury Department, as well as an oversight mechanism for who gets money.
Any company receiving a government loan would be subject to a ban on stock buybacks through the term of the loan plus one additional year. They also would have to limit executive bonuses and take steps to protect workers. The Treasury Department would have to disclose the terms of loans or other aid to companies and a new Treasury inspector general would oversee the lending program.
Notably, Democrats won language that would bar any business owned by Trump or his family from getting loans from Treasury. Businesses owned by members of Congress, heads of executive departments and Vice President Mike Pence also would be blocked.
In a letter to his fellow Democrats, Schumer highlighted a series of transparency measures that would prevent keeping loans secret and create a new inspector general to oversee the program.
Schumer also said that hundreds of billions would be spent on Democratic priorities, including the expansion of unemployment benefits, money for hospitals, as well as more funding for cities and transportation.
Democrats also rejected the $3 billion sought by the Trump administration to buy oil to fill the Strategic Petroleum Reserve.
Pelosi said on Tuesday that the House could quickly approve a Senate-passed coronavirus stimulus with a voice vote that does not require members to travel to Washington — as long as the bill does not have any “poison pills” Democrats object to.
That would also require the unanimous consent of all House Republicans. The second-ranking House Republican, Representative Steve Scalise of Louisiana, told his vote-counting team during a conference call Tuesday night that the best option is to accept a Senate-passed economic stimulus bill, according to Scalise spokesperson Lauren Fine.
Eric Ueland, the White House legislative affairs director, said after the agreement was reached that the “the president and his team look forward to swift action for urgently needed assistance to the American people and powerful aid to the nation’s economy as we work through this crisis.”
The size of the stimulus package is unprecedented, dwarfing the approximately $800 billion Obama stimulus that passed five months after the 2008 financial crash.
Together with Fed intervention, the proposed legislation amounted to a $6 trillion stimulus, according to White House economic adviser Larry Kudlow, or about 30% of annual GDP.
The package will likely more than double a U.S budget deficit that was already set to hit $1 trillion this year before the outbreak. It also may not be the last infusion of government spending in response to the spread of the virus.
Lawmakers universally expressed a sense of urgency as the nation’s economy deteriorates and the health outlook grows more dire. The World Health Organization said the U.S. has the potential to become the new epicenter of the global pandemic as the number of known infections soars.
The proposal is the third — and biggest — plan by Congress to confront the coronavirus crisis as the disease spreads.
An initial $8 billion plan passed by Congress March 5th is funding emergency health care needs stemming from the coronavirus, and a second plan enacted last week will provide many Americans with paid sick leave, food assistance, and free coronavirus testing. It also will send tens of billions in fresh aid to states.
The Senate meets at noon and will resume consideration of the motion to proceed to H.R. 748, the shell bill for the coronavirus response package. The Senate will look for agreement to pass the bill today.
Our Legislative Group will continue to track and monitor developments as they progress, If you have any questions do not hesitate to reach out to us and we can connect you with Patty Mackavage and Eric Martins of Duane Morris Governmental Affairs.
Stay safe.
PA – Modifications to the Life-Sustaining Businesses List on 3-24
Good afternoon and we hope you and yours are keeping up your spirits and remaining in good health.
Earlier this afternoon, March 24th, the Department of Commerce and Economic Development updated their List of Life-Sustaining Businesses and now include on the list of approved businesses (along with those previously approved):
Manufacturing – Veneer, Plywood and Engineered Wood Product Manufacturing and Other wood product manufacturing
Manufacturing – Aerospace Product and Parts for defense industrial base and transportations manufacturing under CISA advisory is permitted
Wholesale Trade – Lumber and Other Construction Materials Merchant Wholesalers
Retail Trades – Health and Person Care Stores are NOT permitted BUT pharmacies are now permitted
Non-Store Retailers – NOT permitted except fuel sellers and bottle water sellers ARE permitted
Information – Telecommunications – Telecommunications resellers are now Permitted – Note that retailers selling devices at physical locations are still NOT permitted
Educational Services – all are still marked as Prohibited but now there is direction to the PA Department of Education guidance at education.pa.gov/COVID19
Healthcare and Social Assistance – update to Child Care Services which are Prohibited but now reference Stay at Home Guidance
Leisure and Hospitality – Food Services and Drinking Places – Drinking Places are still Prohibited but reference to takeout and delivery is Permitted
Attached is the updated list of life-sustaining and non-life sustaining businesses as of 2:30 pm on 3-24-20 – NOTE that this list has been modified 3x since original date of publication on Thursday so please make sure you are looking at the most up to date list – https://www.pa.gov/guides/responding-to-covid-19/#ForBusinesses
The updated list is available at: https://www.scribd.com/document/452553026/UPDATED-2-30pm-March-24-2020-Industry-Operation-Guidance
We will continue to track local and national information and report as new news becomes available through our COVID taskforce. If you care to look directly, go to www.governor.pa.gov and www.doh.pa.gov.
If you have any questions or concerns, please do not hesitate to contact us via email and we will call you back to discuss your concerns.
We can be reached at any of the following email addresses and will direct your inquiry to the appropriate person within our COVID Taskforce – bamolotsky@duanemorris.com; emincer@duanemorris.com; slcaffrey@duanemorris.com; or dcanderson@duanemorris.com.
Be safe.
Delaware’s Governor Issues Closure Order for Non-Essential Businesses effective 8 AM on March 24, 2020
Governor John Carney issued his Forth Modification of the Declaration of a State of Emergency for the State of Delaware Due to a Public Health Threat, pursuant to which he has ordered the closure of non-essential business and commercial establishments in the state of Delaware (the “Non-Essential Business Closure Order”).
The order takes effect on Tuesday, March 24, 2002, at 8:00 a.m. and remains in effect “until after May 15, 2020, or the public health threat of COVID-19 has been eliminated . . . .” Violations of the Non-Essential Business Closure Order constitute a criminal offense.
While “Essential Businesses”—as defined in the Governor’s Order and highlighted below—may continue to operate, such businesses must continue to comply with certain health-protecting guidelines and measures promulgated by the Centers for Disease Control and Prevention (“CDC”) or the Delaware Department of Health and Social Services’ Division of Public Health (“DPH”).
Among the measures Essential Businesses are required to observe while they remain open for employees and customers are the following: (a) implementing flexible and non-punitive sick-leave policies; (b) excluding employees who are actively exhibiting signs of illness or have had close contact with persons diagnosed with, or suspected of having COVID-19; and (c) the adoption and encouragement of certain personal hygiene and property sanitizing practices.
The Non-Essential Business Closure Order, appears to be fairly liberal in adopting Delaware’s definition of what businesses or industries are considered Essential Businesses. To that end, businesses that employ or utilize workers in the following general areas are considered “Essential Businesses” and may remain operational to provide functions critical to the day-to-day needs of Delaware’s citizens:
• Healthcare/Public Health: Not surprisingly, the list of workers related to the Healthcare/Public Health industry is quite broad and not only includes those persons directly responsible for providing healthcare services, but also workers and businesses that are critical to the support of such healthcare functions.
• Law Enforcement, Public Safety, First Responders
• Food and Agriculture: Here, too, the list of essential functions broadly captures a wide swath of the food and agriculture segment to ensure that this critical industry remains functional. Thus, the directive generally declares as essential workers and businesses critical to the production of, distribution of, and the sale of food and beverage products not only for human consumption, but also for pets and livestock.
• Energy: This industrial category is broken down into the following sub-categories: (a) Electricity Industry; (b) Petroleum Industry (including transport, storage, refining, distribution, and sales); and (c) Natural Gas and Propane.
• Water and Wastewater
• Transportation and Logistics: This category broadly covers persons and businesses needed to move goods and services, as well as to maintain the assets used in transportation and logistics activities.
• Public Works
• Communications and Information Technology
• Other Community-Based Government Operations and Essential Functions: This category covers workers such as: (a) election personnel; (b) weather forecasters; (c) educators; and (d) hotel workers, among others.
• Manufacturing: This category broadly encompasses: “Workers necessary for the manufacturing of materials, goods, products, or similar distribution.”
• Hazardous Materials
• Financial Services and Insurance
• Chemical
• Defense Industrial Base
• Construction: This category includes both the persons engaging in the construction and repair of residential and non-residential structures and the businesses that supply materials and hardware to those trades.
• Necessary Products Retailers: This category lists a number of “Necessary Products” that include: (a) medical and hygiene supplies, (b) dry goods; (c) agricultural supplies; (d) pet and animal food supplies; (e) hardware; (f) products and equipment needed to work from home; (g) alcohol, beer and wine; and (h) “any other household consumer products or other products necessary to maintain the safety, sanitation, and essential operations of residences.”
• Necessary Retail and Service Establishments: This category lists twenty-six types of Necessary Retail and Service Establishments that include: (a) businesses that sell to or supply such businesses; (b) plumbers, electricians, exterminators, etc.; (c) lawn and garden retail facilities; (d) marinas; (e) childcare facilities; (f) professional services such a legal and accounting; (g) hotels and taxis; and (h) pet sitters.
• Open Air Recreation Facilities
The Non-Essential Business Closure Order also contains a list of types of businesses that are considered “Non-Essential Businesses,” which includes places such as casinos, racetracks, sporting facilities, theaters and concert halls, among others. This list appears to cover a number of facilities in which large numbers of people might ordinarily gather together.
To determine the specific status of a specific type of business or worker, the State of Delaware has published an industry status list, in which the industries named above are broken down into their 4-digit North American Industry Classification System (NAICS) code. The industry classification list states—by code number—which types of businesses may or may not operate (or operate with certain listed restrictions) during the time the order is in force. Moreover, in a set of FAQ published by the State, it is noted that if a business has more than one NAICS code, “[y]ou may follow the instructions for the least restrictive NAICS code your business is classified under.”
CONCLUSION
Delaware’s Non-Essential Business Closure Order appears to broadly define Essential Businesses in a manner that will allow many aspects of Delaware’s manufacturing, commercial and business or landscape to continue to operate, and therefore, to afford Delaware’s citizens the most normal day-to-day life possible in these challenging circumstances and secure in their knowledge that essential aspects of daily lives will not be unnecessarily restricted.
If you have questions regarding how the Non-Essential Business Closure Order might affect your business, the lawyers of Duane Morris, LLP, have had in place a COVID-19 rapid response team for several weeks now and are ready to assist with your legal needs. Information about Duane Morris’ capabilities may be found at www.duanemorris.com.
Feel free to email us as well if easier – bamolotsky@duanemorris.com; slcaffrey@duanemorris.com; dcanderson@duanemorris.com; jsegal@duanemorris.com and we will direct your inquiry accordingly.
Be Safe.
PA – “Non-Life Sustaining” Business Closure of Physical Locations Questions and Waiver Process – Required Shut Downs
As you are likely aware, on Thursday, March 19th, by Executive Order, the Wolf Administration ordered the physical location shut down of all “non-life sustaining” businesses in order to attempt to slow the spread of COVID-19.
A list of what qualifies as “non-life sustaining” was published on line and is attached for your review. Some businesses like grocery stores, pharmacies, hospitals, e.g., are very logical, others are a bit more surprising (e.g., beer and liquor sales).
Per Governor Wolf’s and the Department of Health’s orders, businesses that were non-life sustaining were ordered to close their physical locations on March 19, at 8:00 PM.
As of last evening, March 20th, these orders are still effective, however, the enforcement timing will change and become effective on Monday, March 23, at 8:00 AM.
If you are not sure if your business falls within a GREEN area (one that is permitted and life sustaining) or a RED area (one that is not deemed to be life sustaining and therefore must close your physical location) per the Commonwealth’s chart, there is a process to inquire, ask questions, and ask for a waiver.
Questions and Waiver Requests:
Those businesses requesting clarification on whether they are defined as life-sustaining should check the list, https://www.scribd.com/document/452553026/UPDATED-Industry-Operation-Guidance-March-20-2020 and can email the Department of Community and Economic Development (DCED) customer service resource account at ra-dcedcs@pa.gov, or call 1-877-PA-HEALTH and select option 1 to reach DCED staff.
Please note that the list has been modified since its original posting on Thursday and some additional notes have been added (including some construction related notes).
For businesses that determine from the list that they are non-life sustaining, but would like to seek a waiver, there is an online waiver application.
When a business completes a waiver form, a team of professionals at DCED will review each request and respond based on the guiding principle of balancing public safety while ensuring the continued delivery of critical infrastructure services and functions. Those requesting a waiver will be notified via email if their operations may re-open.
NOTE – Per updates issued last night, businesses applying for a waiver are REQUIRED to remain closed until a decision is made about their application. This is NEW.
Also, please be aware that DCED offers working capital loans that could be of assistance to businesses impacted by COVID-19. Resources and information will be posted to http://dced.pa.gov/resources as they become available.
In addition, Governor Wolf announced the availability of low-interest loans for small businesses and eligible non-profits in all 67 counties in Pennsylvania through the U.S. Small Business Administration (SBA).
Attaching the updated list of life-sustaining and non-life sustaining businesses as of 5:45 pm on 3-21-20 – NOTE that this list has been modified 2x since original date of publication on Thursday so please make sure you are looking at the most up to date list – https://www.pa.gov/guides/responding-to-covid-19/#ForBusinesses
To list is attached and available here: https://www.scribd.com/document/452553026/UPDATED-5-45pm-March-21-2020-Industry-Operation-Guidance
We will continue to track local and national information and report as new news becomes available through our COVID taskforce. If you care to look directly, go to www.governor.pa.gov and www.doh.pa.gov.
If you have any questions or concerns, please do not hesitate to contact us via email and we will call you back to discuss your concerns. We can be reached at any of the following email addresses and will direct your inquiry to the appropriate person within our COVID Taskforce – bamolotsky@duanemorris.com; slcaffrey@duanemorris.com; jsegal@duanemorris.com or dcanderson@duanemorris.com.
Be safe.
Corona Impact – Governor Wolf mandates the closure of physical sites for all but life-sustaining business – TONIGHT – 3-19 – 8PM
Per the Philadelphia Business Journal, Gov. Tom Wolf on Thursday afternoon ordered “all non-life-sustaining businesses” in Pennsylvania to close their physical locations beginning at 8 p.m. Thursday for an undetermined amount of time.
He also said enforcement for non-compliant businesses would begin at 12:01 a.m. Saturday.
“To protect the health and safety of all Pennsylvanians, we need to take more aggressive mitigation actions,” Wolf said. “This virus is an invisible danger that could be present everywhere. We need to act with the strength we use against any other severe threat. And we need to act now before the illness spreads more widely.”
Notwithstanding that the City of Philadelphia had its own version of business closure mandates from earlier this week, the Governor’s pronouncement applies to the entire Commonwealth – WOW!
Difficult times call for difficult decisions.
“Non-life sustaining” is defined by a chart published by the Administration that you can find online at https://www.governor.pa.gov/wp-content/uploads/2020/03/20200319-Life-Sustaining-Business.pdf
Be safe.
From the Land of OZ: Belpointe REIT OZ Fund is now trading on the OTCQX
As we beckon in the New Year and a new decade, Belpointe REIT recently announced that it has started trading on the OTCQX (the OTC) under the symbol “BELP.”
Read more in our new Opportunity Zones blog.
From the Land of OZ – My Top Ten Favorites from the Final Regs
Now that we have all had a chance to celebrate a Merry Christmas, a Happy Kwanzaa or a Happy Hanukah, and have had the chance to digest 544 pages of final OZ regs – what, you say you have not really studied the new final regs yet – can’t be the case :) !
Read more in our new Opportunity Zones blog.