Houston Loper lives in Raleigh and is the owner of HL Catering. This letter was shared with the permission of Mr. Loper.
Members of Congress:
I know you all are working to determine the best response to help those negatively affected by COVID-19. I continue to hear that $1,000-$2,000 will be paid out to every person in the U.S. below a certain income level. As a small business owner, however, I feel the more prudent response would be to provide immediate payroll relief to small businesses so I can actually keep my business open and my employees paid, which will keep them from needing the relief. Otherwise, I will be forced to let them go, increasing the unemployment rate and affecting overall confidence in the economy.
These proposed payments are the wrong decision for the following reasons:
- They will not keep small businesses from letting employees go. In fact, businesses will be quick to feel the employees will be taken care of by the relief funds and feel the best move for their business is to let workers go so the business has enough cash flow to rehire them when the crisis is over.
- Not everyone is being let go. Many companies these days are still able to function remotely, such as law firms, IT companies, consulting agencies — really any company that relies on the internet and computers to get the job done. Therefore, NOT EVERYONE needs this relief at this moment. The funds would be better used toward helping companies directly affected keep their employees on payroll. This will in turn reduce the number of those unemployed and needing government assistance.
- The country will be taking on a considerable amount of new debt by making payments to all instead of focusing on the businesses and people who are directly affected.
- The goal should be to keep as many people employed and businesses running as possible. This pay-out decision would cause businesses to close and more people to be unemployed and reliant on government assistance. If the government helped small businesses first, fewer people would be out of work.
I believe the following steps would be more beneficial and would ensure I can keep my business’s doors open and my employees paid:
- Release immediate funds using unemployment insurance for small businesses to cover payroll expenses for the next couple of months. The government has access to our 2019Q4 payroll expenses to determine the amount needed to plan for our employees. Any company that receives these funds and does not use them to pay their employees should be fined significantly or have criminal charges brought against them. These funds should be available to those who have already let people go so they can rehire their workers and keep their team intact until this crisis is over.
- Additional funds to cover several months of fixed operating expenses such as rent, insurance, loan payments, etc. should be released to small businesses immediately. This would be a 20- to 30-year loan at a very low interest rate. I realize the Small Business Administration is offering loans. However, many small businesses do not have the bandwidth, team of lawyers, nor time to file for and wait for an SBA loan and need the funds as quickly as possible.
- Two months from now, the government should re-evaluate whether more funds are needed based on whether the crisis is over or ongoing.
As a small business owner of a catering company, my business was thriving two weeks ago. I have an amazing team, which I would like to keep intact instead of making the difficult decision to let people go so they can collect unemployment and so I can save the business. If you focus relief funds on small businesses, especially in the hospitality sector, which cannot function normally under quarantine, then you will find fewer people out of work needing assistance. People would rather keep their jobs than be unemployed and receive a monthly check that doesn’t cover their bills.
I appreciate your consideration of my recommendations as a small business owner who has been directly affected.
Kind regards,
Houston L. Loper
Owner, HL Catering Company