WHAT IS THE LAW?
Governor Newsom announced the creation of a $500 million COVID Relief Grant administered by the California Office of the Small Business Advocate (CalOSBA) for small businesses that have been impacted by COVID. Two rounds of funds will be awarded to selected intermediaries to distribute relief through grants ranging from $5,000- $25,000 to eligible small businesses, based on their annual revenue from their most recent tax return. Eligible small business must be an active business since June 2019, have yearly gross revenue of $2.5 million or less (but at least $1,000) & must currently be operating or have a clear plan to re-open the business. Owners of multiple businesses, franchises, locations, etc. will be considered for only one grant and are required to apply for the business with the highest revenue.
What can grant funds be used for?
Only those costs incurred due to the COVID-19 pandemic and the health and safety restrictions such as business interruptions or business closures. The following are the eligible uses of grant funds:
- All employee expenses, including payroll costs, health care benefits, paid sick, medical, or family leave, and insurance premiums
- Working capital, overhead (including rent, utilities, mortgage principal and interest payments, debt payments (principal and interest) incurred before March 1, 2020
- Costs associated with re-opening business operations after being fully or partially closed due to state-mandated COVID-19 health and safety restrictions and business closures
- Costs associated with complying with COVID-19 federal, state or local guidelines for reopening with required safety protocols, including but not limited to equipment, plexiglass barriers, outdoor dining, PPE supplies, testing, and employee training expenses
- Any other COVID-19 related expenses not already covered (for the same period) through grants, forgivable loans or other relief through federal, state, county or city programs
Grant funds may NOT be used for human resources expenses for state share of Medicaid, employee bonuses or severance pay, legal settlements, taxes, personal expenses unrelated to COVID-19 impacts, expenses for repairs already covered by insurance, reimbursement for donated items or services.
What Is The Rollout Timing?
First round application deadline opens on December 30, 2020 at 6:00 AM PST & closes January 8, 2021 at 11:59 PM PST. Approval notifications begin January 13, 2021. The second round application dates are still to be announced.
One complete application will qualify you to be considered for both rounds.
To apply for this grant & additional information:
Get tax and compliance assistance from RASI! Request a Demo here.
