North Dakota Department of Commerce novel coronavirus (COVID-19) update | April 3, 2020
Latest CARES Act Guidance
On April 2, the Small Business Administration released new information guidance on the Coronavirus Aid, Relief, and Economic Security (CARES) Act regarding the Paycheck Protection Program (PPP).
The new guidance included the application form and the lender’s portal, which officially opened the application process as of April 3.
The purpose of PPP is to help businesses avoid layoffs by providing them with loans to cover their payroll costs. The loan is available to small businesses with less than 500 employees, as well as nonprofits, sole proprietors, independent contractors and self-employed individuals.
A key component of this program is loan forgiveness under certain circumstances.
Businesses may be eligible for loan forgiveness up to an amount including expenses during the covered period (eight weeks after origination date).
The forgiveness amount can include payroll and other operating expenses incurred during the covered period. However, the new guidance released last night indicates that only 25% of the amount forgiven can be for non-payroll expenses. The recent guidance was established to ensure the purpose of the program - retaining employees - is achieved.
The PPP can be used in conjunction with the Economic Injury Disaster Loan (EIDL) if proceeds are not used for the same purpose. For example, if applying for the EIDL to pay April payroll, you cannot also apply for the PPP to pay April payroll.
These loans are first-come, first-serve and business owners are highly encouraged to consult with their accountants and lenders as quickly as possible to determine is one, or both, of these financial resources is best for you.
COVID-19 North Dakota Business Briefing
Gov. Burgum this week provided opening remarks to more than 2,200 individuals who called in for the COVID-19 North Dakota Business Briefing.
The goal of this week’s briefing was to provide guidance and updates on resources available for businesses, employers and employees with a strong emphasis on the CARES Act.
The briefing call is one of many methods bringing North Dakota leaders, businesses and employers together to discuss updates, information and resources pertaining to COVID-19.
The recent and previous COVID-19 North Dakota Business Briefing calls are available online for those who were not able to call in. Click on the video below to access the presentation.
Below is a brief recap of notes from the April 2 call:
Stimulus Package Overview
Commerce Commissioner Michelle Kommer provided a detailed overview on the federal economic stimulus package:
Since March 6, there have been three phases of the economic stimulus package. Phase I was the Coronavirus Preparedness and Response Act; Phase II was the Families First Coronavirus Response Act; and Phase III is called the Coronavirus Aid, Relief, and Economic Security Act, or “CARES Act.” There is speculation there may be a fourth phase focused on infrastructure.
- Signed into law by President Trump on March 6. The bill provides $8.3 billion in emergency funding for federal agencies to respond to the COVID-19 outbreak.
- The bill allocated $20 million in support for the Small Business Administration (SBA) to provide $7 billion in low-interest disaster assistance loans to small businesses financially impacted as a result of coronavirus.
- Provided $1 billion to build infrastructure for the nation’s unemployment insurance systems to handle the expansion.
- On March 18, 2020, the Families First Coronavirus Response Act also known as the FFRCA was signed into law.
- The Families First Coronavirus Response Act is a relief bill aimed to ease the effects of coronavirus on the nation’s economy and public health. Key provisions of this bill that would impact business include unemployment compensation, paid sick leave and paid family medical leave.
- This act went into effect April 1 and creates obligations for employers.
- On March 27, the president signed into law the Coronavirus Aid, Relief, and Economic Security Act – or the CARES Act. The CARES Act aims to address the economic disruption caused by the COVID-19 pandemic and authorizes up to $2 trillion in government spending to accomplish that goal.
- Provides nearly $350 billion for support for small businesses, $260 billion to expand unemployment insurance benefits and $300 billion in the form of direct benefits.
- Four components relating to business financing and individual benefits include:
- Economic Injury Disaster Loans (EIDL)
- Paycheck Protection Program (PPP)
- Expanded unemployment
- Direct payments to individuals
SBA EIDL and PPP
U.S. SBA District Director Al Haut provided key points about the SBA Economic Injury Disaster Loan and the Paycheck Protection Program:
- Loan includes a $10,000 emergency advance.
- Businesses can receive up to $2 million.
- Completely guaranteed by the federal government.
- May be used to pay for business expenses that cannot be paid due to COVID-19, such as payroll, accounts payable, equipment and machinery purchases, real estate payments and many other.
- The loan may be used for payroll support such as employee salaries, paid sick or medical leave, insurance premiums, mortgage payments or other debt.
- The loan may be forgivable upon meeting certain conditions.
- This program expands the Expands definition of small business to “not more than 500 employees.”
- Establishes loans eligibility for sole-proprietors, independent contractors and other self-employed individuals.
North Dakota Insurance Department
Insurance Commissioner Jon Godfread presented the following:
- Employers should not make rash decisions. Try to continue to offer benefits to employees, even if that means utilizing the PPP program outlined in the CARES Act.
- If a business is having trouble making premium payments, Godfread recommends that they work with their insurance company. Options are available:
- Extension of payment deadlines
- Built-in payment flexibility
- Ability to waive waiting period for the benefits of new employees
- Commissioner Godfread encourages businesses to use the furlough option if they must.
- If businesses have to lay off employees, let them know what options they have available to them:
- Special ACA enrollment period
- Short-term limited duration plan
Executive Director of Job Service North Dakota and Workforce Safety Insurance Bryan Klipfel's key points adds:
- The CARES Act provides three primary changes to account for the broadest groups of people possible:
- Pandemic Unemployment Assistance (PUA)– For individuals not eligible for regular, extended benefits, or Pandemic Emergency Unemployment Compensation (PEUC), including independent contractors, self-employed, gig workers, etc.
- Pandemic Emergency Unemployment Compensation (PEUC) – Provides 13 weeks of additional benefits for those individuals that may have exhausted all rights to state unemployment insurance. This will primarily assist those individuals who are seasonal workers laid off in the fall who have used up all of their benefits but due to the pandemic are not being called back to work.
- Federal Pandemic Unemployment Compensation (FPUC) – This program provides for the addition of $600 to each unemployment insurance benefit payment made to an individual, whether on the regular unemployment insurance program or any of the new programs within the CARES Act.
- Job Service North Dakota is awaiting guidance and rules from the U.S. Department of Labor in order to program its mainframe to accept PUA and PEUC claims. (FPUC will happen automatically, with no action needed from the claimant, as soon as the system programming is in place.)
- Employees who do not fall under the employee types noted for PUA and PEUC can file an unemployment insurance claim immediately. We are asking those who do fall under the PUA and PEUC programs to wait to apply until our system programming is in place.
The U.S. Treasury released the Interim Final Rule for the Paycheck Protection Program (PPP) on the evening of April 2 and additional guidance is expected in the near future. Join us next week for an overview of provisions of the CARES Act with recently released guidance and other implementation updates, along with hypothetical scenarios to illustrate how the EIDL, PPP and expanded unemployment provisions of the CARES Act that can assist your business in navigating the business disruption caused by COVID-19.
This call will be recorded for later access and posted, along with reference materials, on the employer page of NDResponse.gov.
Local businesses expand production in response to COVID-19
Fargo's Proof Artisan Distillers announces it will soon produce hand sanitizer
Proof Artisan Distillers in Fargo announced March 19 that it is gearing up to make hand sanitizer - a much sought after commodity as worries over coronavirus transmission has led to buying that’s cleared the shelves of area stores.
Fargo tech company, University of Minnesota team up on emergency ventilators
Fargo-based Appareo Systems will make low-cost ventilators developed at the University of Minnesota to be used as emergency back ups.
Main Street Initiative
Commerce wants to better understand how the COVID-19 pandemic is impacting businesses across our state. By tracking survey information collected below, we hope our agency and partner organizations can identify additional resources we may be able to leverage to support North Dakota businesses during this challenging time.
This survey asks about experiences since March 13, 2020 (when Gov. Burgum declared a state of emergency in response to the pandemic) and within the next 30 days. The MSI team plans to reissue the survey again in the near future to identify trends in business impact over time.
Commerce has received more than 1,000 survey responses. The survey will stay open until April 11 or 12 and will reissue the survey 30 days.
In addition to the survey, the MSI team has been reaching out through webinars.
The webinar Support for Community Organizations was hosted April 3. Megan Laudenschlager of Strengthen ND and Scott Holdman of Impact Foundation joined the webinar to present to the 50 participants.
The next Main Street webinar Using Technology to Engage Community and Hold Public Meetings will be held next week. For questions, email Brett at firstname.lastname@example.org
Around 50 Tourism business and promoters joined the weekly tourism chat last week to discuss how to assist efforts to curtail the spread of COVID-19 and to position North Dakota as the place to visit once we are in recovery mode.
The North Dakota Tourism Division will be hosting its third tourism industry online chat on Monday, April 6, at 2 p.m. CT.
The weekly conferences are designed to share information and best practices for those in the travel and tourism industry affected by the novel coronavirus health crisis in North Dakota.
The session will present valuable information that the industry needs in these challenging times. Tourism Division Director Sara Otte Coleman will lead the briefing that will include updates on how North Dakota Tourism has adapted to the changing landscape to be a source of trusted, pertinent information for those looking for answers.
How to join the meeting:
- Click the Join Microsoft Teams Meeting link.
- Open Teams on the web or download the program.
- Enter your name and choose your audio and video settings. (Video enable if possible, but please mute while others are presenting).
- Click the Join Now button to be admitted into the meeting.
This week, Gov. Burgum announced the activation of North Dakota’s Workforce Coordination Center (WCC), which is a cross-agency collaboration assembled to serve emergency workforce needs in support of health care providers, industries and agencies affected by COVID-19.
The WCC is seeking individuals willing to help with the COVID-19 situation who have experience in the following sectors:
- Health care and public health
- Law enforcement, public safety and first responders
- Emergency shelters, congregate living facilities, drop-in centers
- Child care
- Food and agriculture
- News media
- Water and wastewater
- Critical manufacturing
Those who are out of work, retired or just want to help are asked to consider volunteering during this emergency situation. The WCC is seeking both volunteers and paid staff. Applicants will be matched with a business or agency that needs their help. The WCC also will facilitate businesses’ need for workers for COVID-19-releated services. North Dakota businesses that have a workforce need related to the COVID-19 situation are encouraged to contact the WCC. The WCC will work to connect businesses with the volunteers and workforce they need to fit their needs for these critical skill sets.
To sign up to lend your skills or to submit a request for assistance at your business, go to https://belegendary.link/WCC