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V O L . X X V I N O. V I I A P R I L 6 , 2 0 2 0 6 B U S I N E S S M A I N E Business news from around the state NEW INCENTIVES for high-performance heating and cooling systems FOR MORE INFORMATION, VISIT EFFICIENCYMAINE.COM OR CALL 866-376-2463 Talk to your contractor or building team about the benefits of Variable Refrigerant Flow systems, including: • efficiency, • quiet operation, • compact size, • individualized temperature control, and • ability to heat and cool different zones simultaneously. COOL HEAT Paycheck Protection part of $2.2 trillion CARES Act program B y W o r c e s t e r B u s i n e s s J o u r n a l S t a f f F ormer President Ronald Reagan made this saying famous by calling those the nine most terrifying words in the English language. His point: Who would ever get suckered into believing it? If you've spent a lifetime thinking the government is the enemy, you might as well stop reading right here, but if you're interested, there are incentives for small businesses to help subsidize their payrolls, healthcare costs, and support cash flow over the next 90 days of this coronavirus nightmare. The $2.2 trillion CARES Act, signed into law by President Donald Trump, has features that should be of interest to any small business owner. The Keeping Workers Paid and Employment Act section helps businesses with 500 or fewer employ- ees (which includes nonprofits, sole proprietorships, etc.) by providing $367 billion of funding to subsidize employers who maintain their payroll and avoid layoffs, as well as funding to help pay payroll costs through June 30. There are adjusted levels of qualified fund- ing for companies who have had some layoffs or have fewer employees than a year ago. These loans are 100% backed by the federal gov- ernment, and an early reading indicates they will not require any personal guarantees. The details are still coming out, but it appears if you borrow funds under this program for the full qualifying period, a good chunk of it will be forgiven. If your business is shut down and you can't make any sales, keeping employees on the payroll, even at a reduced rate may not make sense. So, what is the catch to these loans? The require- ments are not onerous. There is a maximum loan amount of $10 million, and the government won't loan for any portion of any individual salaries exceeding $100,000 a year. If you have a bunch of high earners and sign up for this program, they are going to make less, or your payroll subsidy will be less, but it will still be more than unemployment would pay. But most folks aren't making that kind of money, so you'd be fully quali- fied for anyone under that $100,000 level as long as you maintain their regular salary, or close to it. This legislation allows you to get the funds to cover payroll and healthcare expenses for 2.5 times your aver- age monthly payroll of last year. So if you have been spending about $50,000 on those expenses each month, you can qualify for about $125,000 in a loan. As long as you keep accurate records and don't cut corners, the vast majority (based on our current reading of the Senate version of the bill) of those loan amounts spent during those next eight weeks as directed will be forgiven, a period that can run to June 30. The government picks up their part of the tab on this as long as you maintain a steady number of employees making their regular paycheck for this period. This program will be administered through our local banks and credit unions, and potentially other lenders as well. What can you do today to get ready? A simple list includes a run of your last 12 months of payroll, and a view of what you paid staff during the same March 1 to June 30 period in 2019. You should call your banker or accountant and ask for their help in gaining a deeper understanding of this program and they can help you evaluate the incentives for your situation. They'll just be getting up to speed too, but push hard to get clear answers. B R I E F I'm from the government, and I'm here to help. — Ronald Reagan S O U R C E : Wall Street Journal CARES ACT: RELIEF AMOUNTS ($ BILLIONS) Corporate loans $454 Small business loans $349 Household payments $301 Unemployment insurance $250 Tax deferrals /extensions $221 Aid to states $150 Hospitals / Vets Care $117 Other $284

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