By Cindy Jackson
April 17, 2020
” . . . there is the unknown of what the Corona pandemic will ultimately cost the County, Megan Diehl, OMB Director, reminded Commissioners that there is also the loss in sales tax revenue that needs to be considered and noted that the County could face a budget shortfall of between $5 million – $8.5 million as a result.”
At the April 15, 2020, meeting of the BOCC (Board of County Commissioners), Nassau County Attorney/County Manager Mike Mullin spoke at length on a variety of subjects relating to providing relief for local businesses as a result of the Corona Virus.
One such item was a proposal put forth by the Nassau County Chamber of Commerce. Chairman Leeper, at the very start of the BOCC meeting, expressed his disdain that the Chamber had inaccurately reported to its members that the BOCC had rejected outright the Chamber’s proposal to provide loan and grant relief to small businesses in Nassau County.
While Mullin applauded the enthusiasm of Chamber Executive Director Regina Duncan, he underscored the fact that Nassau County, along with most local governments in the State of Florida, are not in the business of making loans or grants but he understands the need. In fact, according to cursory research conducted by Mullin and staff, of Florida’s 67 counties only three have any loan or grant programs in place.
One such locale is Duval County — home to the Jacksonville Electric Authority (JEA) which pumps a lot of money into that county’s economy. The other locales providing some such program are Daytona Beach and Leon.
As per the Chamber’s proposal, approximately 2,687 businesses (of a total 3,342) in Nassau County would meet the qualifications for participation in the program. As drafted, requirements would include these items:
• must have been in operation for at least one year
• must have between 2-50 employees
• must provide most recent tax returns for both business and owners
• must provide a personal guarantee from all business owners
A minimum personal credit score of 720 would be waived. One option outlined by the Chamber would cost the County an estimated $4.5 million and a second option, with a lesser amount of money provided to each business would carry a price tag of some $2.8 million. Both options envisioned a participation rate of 40% or 1,074 local businesses.
After a lengthy discussion of Chamber’s preliminary proposal, and while no vote was taken, Chairman Leeper’s comment that “we have more questions than answers” seemed to resonate with every Commissioner although all also expressed a desire to “do something.”
Mullin went on to explain that for the most part, local governments, (like Nassau County), are not set up to be a bank adding that, by law, local governments cannot loan money to individuals/businesses. “Government is not equipped to do that. They don’t have the staff to do that, they don’t have the funds to do that,” said Mullin.
At the current time, Nassau County does not have adequate reserves set aside to provide any sort of relief to private businesses.
What Nassau County does have is:
• an Emergency Disaster Reserve of about $8 million. Hurricanes Matthew and Irma cost the County well over $6 million for which the Federal Emergency Management Agency just recently reimbursed. (During the discussion of the Emergency Reserve, Mullin reported that the State Emergency Management Association has forecasted four hurricanes for our area and that season begins June 1).
• a Capital Improvement Projects reserve of $4 million but that money is earmarked for specific road and bridge projects long since planned and approved.
• a reserve for the Minimum Fund Balance to cover two and a half months of County operations for $10 million (the minimum standard); and
• a Contingency Reserve of $1.8 million. That fund, explained Mullin, is designed to provide the County with funds for emergencies. For instance, the Corona pandemic has created the need for more gowns for first responders and sprayers to decontaminate equipment. Those expenses are something no one ever anticipated.
In addition to concerns about damages from potential hurricanes, there is the unknown of what the Corona pandemic will ultimately cost the County, Megan Diehl, OMB Director, reminded Commissioners that there is also the loss in sales tax revenue that needs to be considered and noted that the County could face a budget shortfall of between $5 million – $8.5 million as a result.
What the Board of County Commissioners did approve was that a letter be sent to Congressman John Rutherford and Senators Marco Rubio and Rick Scott with regard to C.A.R.E.S. (the Coronavirus Aid, Relief, and Economic Security Act), that was signed into law by the President back in March.
As detailed on the website for United States Treasury Department, The CARES Act [among other things] established the $150 billion Coronavirus Relief Fund. Treasury will make payments from the Fund to States and eligible units of local government. . . with a population that exceeds 500,000.”
The County would like to see that threshold be reduced to 50,000.
Also included in the C.A.R.E.S. Act is the Paycheck Protection Program “which provides small businesses with the resources they need to maintain their payroll, hire back employees who may have been laid off, and cover applicable overhead.” It authorized up to $349 billion toward job retention and other expenses.
Another popular economic relief program sponsored by the federal government is the COVID-19 Economic Injury Disaster Loan (EIDL), which provides provides economic relief to businesses currently experiencing a temporary loss of revenue. Referred to as “an advance,” it will be forgiven if spent on paid leave, maintaining payroll, mortgage, and/or lease payments. However, both of these programs have exhausted their current funding and no applications are being accepted at this time.
As indicated by Commissioner Leeper, the BOCC hopes to compile a list of all resources and programs (state, federal and local) available to help small businesses suffering as a result of this global pandemic. “Our primary goal is to meet the needs of our citizens.”