Progress Made to Close the Digital Divide, but the Need is Still Huge: Here’s How You Can Help

 

There is some good news to share about Greater Cleveland’s digital divide: Since last August, the Cleveland-area corporate community has donated more than 6,000 computers to PCs for People for low-income families. These donations have allowed students to learn remotely, seniors to attend e-health conferences with their caregivers, and many more to work from home or find employment.

However, the need is still huge. Currently, PCs for People has a waiting list of families in need of a home computer. At the same time, there has been a decline in PC donations over the past few months. We do not want to lose the momentum that we have generated since August. Our community has made progress, but if we are going to help close the digital divide, we cannot stop now.

Please continue to donate your used computers and electronic devices to PCs for People. If you have not donated, and your business is interested in partnering with PCs for People, please contact Bryan Mauk, Executive Director of PCs for People Cleveland, at bmauk@pcsforpeople.org. Or if you prefer to make a cash donation, please contribute to the Greater Cleveland Digital Equity Fund at clevelandfoundation.org/DigitalEquity.

Together we can continue to maximize our impact and work to eliminate the inequalities that are exacerbated by our region’s digital divide, but we must keep up the work.

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  • Next up: Small Business Administration Updates: EIDL and PPP

    Small Business Administration Updates: EIDL and PPP

     

    EIDL Updates

    Starting the week of April 6, 2021, the U.S. Small Business Administration (SBA) is raising the loan limit for the COVID-19 Economic Injury Disaster Loan (EIDL) program. Applicants can now receive a maximum loan amount of $500,000. The lending limit will also be increased to up to 24-months of economic injury. Businesses that have already received the EIDL do not need to submit a request for an increase; SBA will reach out directly via email and provide more details about how they can request an increase. Any new loan applications and any loans in process when the new loan limits are implemented will automatically be considered for the increased limits. You can learn more here.

    The SBA also announced extended deferment periods for all disaster loans until 2022. The agency will extend the first payment due date for disaster loans made in 2020 to 24-months from the date of the note and 18-months from the date of the note for all loans made in calendar year 2021. Click here to learn more.

    PPP Updates

    This week, President Biden signed an extension for the Paycheck Protection Program (PPP). The deadline to apply for a PPP loan has been extended from March 31, 2021 to May 31, 2021. The law also extends authorization of loans to June 30, 2021 to give the SBA additional time to process applications. In late February, the Biden Administration announced several additional changes to the program, including allowing sole proprietors, independent contractors, and self-employed individuals to receive more financial support and eliminating exclusionary restrictions on PPP access for small business owners with prior non-fraud felony convictions or with student loan debt delinquency. You can learn more about these changes here.

    To view all SBA guidelines about the PPP, click here.

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  • Next up: Shining an Outside Light on Your Business

    Shining an Outside Light on Your Business

     

    Whether you’re starting a business, are established in your vertical or at the mature end of the business cycle, you and your business need the insights and experience of a diverse team of financial advisors. A well-structured financial advisory team brings fresh perspective, professional expertise and puts the business’s success top of mind. While an owner may rely on their banker for financial guidance, a CPA, attorney and an industry expert will play pivotal roles on the advisory team. In highly specialized or high growth industries, additional advisors should be considered as temporary or permanent members of the advisory team. 

    This team of outside professionals provides ongoing insights into industry, markets and business strategies more objectively than those working inside a business. This outsider view gives a broader scope to strategy development, issues identification and problem-solving solutions. While each member of the team has a specific area of professional expertise, together they give a full view of where a business is today and how to grow in the future. 

    Kurt Kappa, chief lending officer at First Federal Lakewood, says, “Having the right team of outside financial advisors gives business owners a more wholistic view into their business, their industry and their finances. A trusted team can advise on operations, finances, legal matters and industry and market trends to allow the business owner to stay on course or make necessary adjustments to be successful.”

    Building the Strongest Advisory Team

    Above all, the most important ingredient in an advisory relationship is trust. The business owner must trust the team completely and believe that the team members have the business’s best interests at heart. The advisory team must trust the business owner’s intentions and abilities.  This trust does not mean that differences of opinions will not arise or that the business owner will always take the advice of the advisors. It means instead that opinions and advice are offered and considered thoughtfully and respectfully. 

    To build the financial advisory team, the business owner should self-assess their own strengths and weaknesses before beginning the process of identifying and selecting candidates and advisory team members. Perhaps operations is a strength but understanding tax implications of growth is a weakness. Once the required skill sets are identified, the business owner can reach out to their network, other financial resources and trusted contacts for recommendations on individuals to fill specific roles on the advisory team. This groundwork enables the business owner to leverage what’s working and source team members who can work to leverage the owner’s strengths while closing gaps with supplemental knowledge and skills. Having a clear view of what’s needed makes the process more efficient and focused.

    Time upfront is worth the investment. Taking the time to identify and interview each potential member will ensure clear expectations are set, the right people have the acumen and personalities to work together with each other and the business owner effectively.  The result is a team aligned with the business’s mission and goals.

    Utilizing the Team

    Once the financial advisory team is in place, it’s time to tap into their individual and collective expertise. An ideal advisory team’s diverse skill sets empower the business owner to rely on each individual to provide analysis and counsel in their field. While there may be some cross-over, each will most likely gravitate to what they know best. 

    While one-on-one meetings or even casual conversations will address specific issues or answer certain questions, harnessing the real power of the team involves group discussions and meetings. The frequency is dependent on business needs but some formalized scheduling should occur to allow everyone to participate. Topics may include business development reporting, internal company changes, financial results, pending legal issues or updates on industry, market and regulatory news.  It’s the group who will together dig deeper into results and uncover solutions to drive the business’s strategy forward. 

    From time to time, topics or issues out of the advisory team’s expertise may arise. For example, during the pandemic, many businesses found additional health and safety expertise and the ability to understand and act on pandemic-related relief programs invaluable to running their operations. Outside advisors added to the advisory team on a temporary basis helped fill these gaps.  

    “While a core advisory team is critical, businesses can often benefit from additional outside opinions and views,” said Kappa. “Inviting a specialized expert to participate on an ad hoc basis can enrich the board’s ability to more quickly address changing needs.” 

    Evolving the Team 

    As the business evolves, the team of advisors may change to meet business needs. Some advisors focus on a particular size or type of business such as start-ups or rapidly expanding businesses. For example, perhaps a local one-person accounting practice worked well in the beginning phase of the business, but a larger firm is needed as the business grows organically or by merger and acquisition. During a mid-cycle phase, the business may require more specialized advice for lending and legal options. At the other end of the business life cycle, management may need to begin planning exit strategies and need the advice of a more sophisticated advisor to create and implement a workable plan. 

    “Having an effective advisory team over time is a process,” said Kappa. “While consistency allows advisors to really get to know the business and it’s great to engage those who meet your needs where you are, those needs can and probably will change over time.” 

    Measuring Success

    From organization to acquisition and everything in between, the financial advisory team engages with the business owner, industry experts and each other to shine outside light on the business. Even when it seems to business owners that another hour in the day can’t be found to meet, discuss and learn, relying on a financial advisory team will make the business stronger in the longer term.

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  • Next up: Thank you for attending COSE Day at the Capitol!

    Thank you for attending COSE Day at the Capitol!

     

    Thank you to all those who attended this year’s virtual COSE Day at the Capitol! Thanks to COSE small business members, policymakers in our state’s capital learned more about the critical challenges and opportunities facing small businesses. The day also served as an opportunity for business owners to hear directly from state legislators about their priorities.

    Speakers included Governor Mike DeWine, House Minority Leader Emilia Sykes, Senate President Matt Huffman, and a panel discussion featuring Peter Voderberg, Chief of BroadbandOhio, Sheryl Maxfield, Director of the Ohio Department of Commerce, and John Logue, Interim Administrator of the Ohio Bureau of Workers’ Compensation.

    In addition, five state leaders received Small Business Advocate of the Year Awards. Speaker of the Ohio House Bob Cupp, State Senator Sandra Williams, State Representative Stephanie Howse, Ohio Department of Health Director Stephanie McCloud, and State Treasurer Robert Sprague each received the award, which recognizes those who have sponsored, endorsed, supported, or drafted legislation or led initiatives to advance small business growth throughout Ohio.

    Special thanks go to the event sponsor, Taft Law.

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  • Next up: Urge the U.S. Senate to Extend the PPP Deadline

    Urge the U.S. Senate to Extend the PPP Deadline

     

    The American Rescue Plan Act – a $1.9 trillion bill – was recently signed into law by the President.  Key provisions were included that will aim to support broadband services, public transit, and small businesses.  Ohio is expected to receive more than $5.4 billion from the American Rescue Plan.

    Meanwhile, and as taxpayers await possible further guidance on the Paycheck Protection Program (PPP) loan, a bill to move the PPP application deadline from March 31st to May 31st was approved by  the U.S. House of Representatives, passing in a 415-3 vote.  The legislation now moves over to the U.S. Senate for consideration.

    The nearly unanimous vote came after several dozen business groups endorsed the PPP Extension Act of 2021, H.R. 1799, which extends the filing deadline for PPP applications by 60 days and provides an additional 30 days for the U.S. Small Business Administration (SBA) to finish processing applications received by May 31st.

    Our partners at the National Small Business Association (NSBA) are among the groups that have endorsed the legislation.  Please click here to take a moment and urge your U.S. Senators to support this legislation.

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  • Next up: What did the American Rescue Plan Include for Small Businesses?

    What did the American Rescue Plan Include for Small Businesses?

     

    The American Rescue Plan (ARP) is a $1.9 trillion economic stimulus bill passed by the 117th Congress and signed into law by President Biden on March 11, 2021. The measure contained several aid provisions for small businesses, including restaurants and minority firms. Here’s a rundown of what the ARP included for small businesses. 

    Paycheck Protection Program
    The measure will increase funding and expand eligibility for the Paycheck Protection Program and will allow forgiveness for additional expenses.

    Program Funding: The measure will increase the program’s lending authority by $7.25 billion, to $813.7 billion, and appropriate the same amount for the Small Business Administration (SBA) to guarantee additional loans.

    Tax-Exempt Groups: The measure will expand the eligibility rules to cover more tax-exempt groups, including 501(c)(5) labor organizations, 501(c)(7) social and recreation clubs, and 501(c)(8) fraternal benefit societies. Religious educational groups that might otherwise be barred under SBA rules would be permitted. 501(c)(4) social welfare groups, such as AARP, the ACLU, Americans for Prosperity, and the National Rifle Association, will still be prohibited. The additional tax-exempt groups cannot employ more than 300 employees per location or spend more than $1 million annually or 15% of their time on lobbying activities.

    Larger Nonprofits: Some nonprofits that currently qualify for PPP loans, such as 501(c)(3) groups, cannot have more employees than the SBA’s size standards for the relevant industry and are subject to the agency’s restrictions for affiliated entities. The measure will replace those rules, allowing 501(c)(3) groups with as many as 500 employees per physical location to participate without further restrictions.

    Online News Publishers: Internet-only news publishers that were previously ineligible can receive PPP loans if they have 500 or fewer employees or a size set by the SBA per location. They must certify that the funds will be used to support local news. SBA affiliation rules and a ban on publicly traded companies will be waived for online news outlets seeking loans.

    Loan Forgiveness: The measure expands PPP loan forgiveness to include payments made for premiums on behalf of individuals who qualify for COBRA health insurance continuation coverage. The change applies to loan forgiveness applications received following the measure’s enactment.

    Restaurant Grants

    The measure provides $28.6 billion for a Restaurant Revitalization Fund to be administered by the SBA. Eligible recipients include restaurants, bars, food trucks, and caterers, including businesses in airport terminals and tribally owned entities.

    Disqualified businesses include those run by state or local governments, companies that manage more than 20 locations including affiliates, live venues seeking grants under the year-end Covid-19 relief package, and publicly traded companies.

    For 60 days following the measure’s enactment, $5 billion will be set aside for eligible entities with gross revenue of $500,000 or less in 2019. The SBA will also prioritize awards for small businesses owned by women, veterans, and socially or economically disadvantaged individuals during an initial 21-day award period. Other grant funds will be awarded on a first-come, first-served basis.

    Grant amounts will cover the difference between an entity’s revenue in 2020 compared with 2019. Awards will be reduced by amounts received through the Paycheck Protection Program. Aggregate awards made to an entity and its affiliates cannot exceed $10 million and would be limited to $5 million per location. Eligible expenses generally include payroll costs, mortgage and rent payments, supplies, normal food and beverage costs, and paid sick leave. Funds can be used through Dec. 31, or a date set by the SBA that is no later than two years after the measure’s enactment.

    Disaster Loans

    The measure would provide $15 billion for additional advance payments to eligible entities under the SBA’s Economic Injury Disaster Loan (EIDL) program. The SBA will allocate $10 billion to covered entities that did not receive their full eligible advance payments under the year-end relief package. Those entities include recipients with 300 or fewer employees and economic losses of at least 30% over eight weeks compared with a similar period before the pandemic.

    The remaining $5 billion will be set aside to make new supplemental payments of $5,000 to covered entities with 10 or fewer employees that had economic losses of more than 50% during the covered period.

    State Initiative

    The Act provides $10 billion for the State Small Business Credit Initiative. The Treasury Department will set aside:

    $1.5 billion for states to support businesses owned by socially and economically disadvantaged people.
    $1 billion for an incentive program to boost funding tranches for states that show robust support for such businesses.
    $500 million to support small businesses with fewer than 10 employees.

    The department can set aside an additional $500 million for states to provide legal, accounting, and financial advisory services. It can also transfer the funds to the Commerce Department’s Minority Business Development Agency to provide similar technical assistance. The department must complete all disbursements by Sept. 30, 2030. Any remaining amounts would be rescinded.

     
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