The sandals arrived Thursday, another reminder of what “business as usual” once meant.
Mary Langen, the owner of the Silver Fox boutique on Ingersoll Avenue, had thought they would sell quickly as spring arrived. She ordered 25 pairs of them, flats by Papucei, with a variety of flourishes: polka dots, stripes and flowers.
She envisioned her customers — women over 40, mostly — welcoming the warmth with a few splurges. But on Thursday, the front door of the Silver Fox remained locked. Langen, 59, didn’t bother to switch on the lights in the showroom or dressing room.
Amid Gov. Kim Reynolds’ declaration of a public health emergency over the spread of COVID-19, Langen had told her 10 part-time employees to stay home this week and allowed a handful of customers in, one at a time, by appointment. She has also sent boxes of clothes to some of her regulars, charging their accounts and asking them to mail back whatever items they didn’t want.
But business, for the most part, was dead — though her orders of new clothes kept arriving every morning. Before the pandemic hit, she had signed contracts with vendors out of Chicago for shipments through June.
“I find myself praying,” she said. “And I try not to worry. Have I wrapped my head around what the financial implications of this could be? It could be — it could be horrible.”
Small business owners around Iowa are running the same calculations as Langen. How long can they stay open? Keep staff? Sustain their regular flow of expenses with just a small percentage of their usual revenue?
The state and federal governments are scrambling to assemble resources to help business owners through the economic shutdown. Here is some of the aid that’s available:
Disaster assistance loans
The U.S. Small Business Administration has relaxed some of the rules for how businesses qualify for the loans, which normally go to communities that have suffered from hurricanes, tornadoes or flooding.
The SBA will allow entire states to be considered disaster zones in the wake of the coronavirus pandemic. However, county governments must submit to a stage agency proof that businesses have been impacted. The states, in turn, must submit an application to the SBA.
The Iowa Economic Development Authority hosted a teleconference with local governments, tourism groups and chambers of commerce on Tuesday morning, asking them to gather the necessary information. The state submitted its request to the SBA Tuesday evening, said Economic Development Authority spokeswoman Kanan Kappelman.
The federal agency was still processing the request Friday and had not designated Iowa a disaster area yet. But businesses in eight eastern Iowa counties are already eligible for disaster assistance loans. That’s because the SBA designated Illinois as a disaster area on Thursday, which allows some “contiguous counties” to also get covered. In Iowa, those border counties, lying along the Mississippi River, are Clinton, Des Moines, Dubuque, Jackson, Lee, Louisa, Muscatine and Scott.
Businesses interested in receiving the loans have to apply to the SBA and show how the coronavirus has impacted their revenues. The terms and conditions of each loan will vary, with some parameters: The SBA will loan no more than $2 million to a business, the length of the loan will be no more than 30 years, and the interest rate will be 3.75%.
Jayne Armstrong, district director for the SBA’s Iowa District Office, said her staff is fielding hundreds of calls a day from business owners who think the disaster loans are already available.
Armstrong said the SBA will alert businesses as soon as Iowa is declared a disaster area. She said the state’s Small Business Development Centers and Women’s Business Center are looking for volunteers who can help applicants fill out the paperwork for the loans.
“We’re going to be inundated,” Armstrong said. “We’ve never seen anything like this in the country. We’re going to need as much help as we can get.”
Some government agencies have amended rules to give some small business owners relief. They include:
Unemployment insurance waiver. On Monday, Iowa Workforce Development waived a rule about unemployment insurance that should save businesses money in future years.
Businesses pay an annual rate to a state trust fund for unemployment insurance. Usually, Iowa Workforce Development sets that rate based on the number of a business’ laid-off employees who received unemployment benefits. But under the waiver, any coronavirus-related layoffs will not impact that rate.
Tax payment extension. At the federal level, the Internal Revenue Service has granted an extension for when corporations have to pay their taxes. They can defer up to $10 million through July 15.
Facebook grants; state survey
Facebook, meanwhile, is promising $100 million in grants for small businesses in more than 30 countries. The company is not accepting applications yet, but business owners can sign up for email updates at facebook.com/business/grants.
To prepare for any other state or federal recovery money, the Iowa Economic Development Authority is surveying business owners across the state about how coronavirus has impacted them. The survey will remain open until Monday at 5 p.m.
As of mid-afternoon Friday, about 9,700 people had responded to the survey, including about 1,200 in Polk County, according to the authority.
Around the Des Moines metro, small businesses were taking their own, often difficult measures to survive the pandemic.
Jennifer Kathryn King, the owner of Invictus Media, a marketing company, said she had asked her three full-time employees to cut back their hours. Some clients the company was courting have fallen through — for now, at least. King said she worries Invictus will run out of work if the staff continues to put in a normal, 40-hour week.
Abbie Monk, the co-founder of the Women’s Barbell Classic, has had to cancel the weightlifting competition scheduled for April 25. Between lifters, vendors and spectators, she expected the event to draw about 1,000 people and generate about $30,000 in revenue.
Monk hoped the money could be used for another mission of the nonprofit: an after-school female weightlifting program the group runs at East Side High School. Monk wants to hire a full-time employee and expand the program to every Des Moines high school.
“It kind of shut us down for the rest of the year,” she said.
In the East Village, 38-year-old Sumon Hoque laid off about 15 full-time employees at HoQ, his East Fifth Street restaurant after Gov. Kim Reynolds shut down all table service. He has kept three people in the kitchen and a manager to handle take-out orders.
Some regulars have bought gift cards to show their support, Hoque said. But only six people ordered from the business on Thursday. On a normal day, between lunch and dinner, he said, he would serve about 60 diners.
Losing dinner service is a particularly big hit. As with many restaurants, alcohol sales are the source of HoQ’s greatest profit margins. The restaurant has offered a limited carry-out menu, with burgers, grilled cheese and bowls of falafel and roasted vegetables.
On Friday night, Hoque said he would try something a little more upscale, such as a wild Alaskan salmon with a salad. Still, without the in-person dining experience, he expects to sell it for half the usual price.
“I’m pretty good for this week, next week,” he said. “But if it keeps going on for months, I don’t know if I can stay open.”
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