What does the 'CARES Act' mean for business owners?

Businesses can now access $2.2 trillion worth of assistance thanks to act passed last week

Posted: Apr 2, 2020 2:34 AM
Updated: Apr 2, 2020 6:31 AM

MASON CITY, Iowa - Virtually every facet of life is being affected in some way due to the pandemic.

Businesses are not immune from this, with reductions in staff and pay cuts becoming the new unfortunate norm. But thanks to legislation passed last week, it may be able to protect workers and business owners during this time of uncertainty.

The 'CARES Act', short for Coronavirus Aid, Relief and Economic Security, which was passed and signed into law last week, allocates more than $2 trillion in support for individuals and businesses as they're working to navitage through these stormy waters through things like unemployment insurance, payroll taxes, 401K loans and small business relief, among others.

Paul Mixdorf is not only a CPA with FFC Advisors, he's also the President of Eternity Wireless, a cellphone accessory distributor. He's been working with clients, namely small businesses that are feeling the brunt of the pandemic, on what owners should do.

"Should I lay off people? Should I keep them at 50%? How do they file? Every business is unique."

He's also had to balance some issues at his business.

"I have had to cut back on some hours. We base off of how busy we are by the number of orders."

During a teleconference with Mason City Chamber members Wednesday morning, he heard what options are available through the act.

"We're doing our best to plan with our clients to make sure they are getting the necessary help they can get that's available to them."

John Kirchner oversees the Midwest branch of the U.S. Chamber of Commerce, and has heard from business owners on what they're facing.

"A lot of primarily small business owners have had to make really tough decisions on 'how do we keep our doors open?'"

One piece of the act that would have the widest reaching impact is the Paycheck Protection Program. It provides federally guaranteed loans to small businesses that maintain payroll during this time of crisis, and can be forgiven if they do so.

"If you get, say, a $10 million dollar loan for your business, and spend $8 million on payroll, rent, interest, mortgage and utilities, that $8 million portion turns into a grant. It doesn't have to be repaid."

He's upbeat about what these programs can mean for those in this situation across the country.

"There's a lot of distress in the economy. But I think these programs and some of the other lending through the federal reserve that we're going to get close to spending every bit of that."

Without the passage of the CARES Act, Kitchner predicts more businesses would inevitably shutter.

"I think that impacts to small businesses and businesses across the board would be catastrophic by the time we come out of this. This is trying to get us through the next couple of months, and hopefully that we're through the worst of it." 

So what if the pandemic lasts longer than 90 days? Kirchner says there already is talk in Washington, D.C. about what a 'Phase 4' plan would look like.

Minnesota Coronavirus Cases

Data is updated nightly.

Cases: 483790

Reported Deaths: 6543
CountyCasesDeaths
Hennepin1003791583
Ramsey42945800
Dakota36091387
Anoka33200384
Washington21986254
Stearns18703200
St. Louis14746262
Scott13209107
Wright12489115
Olmsted1176188
Sherburne869772
Carver765240
Clay688887
Rice667191
Blue Earth591035
Kandiyohi578474
Crow Wing518381
Chisago496844
Otter Tail481370
Benton444890
Winona416649
Mower402731
Douglas392268
Nobles386547
Goodhue384468
Polk342262
McLeod338349
Beltrami336751
Morrison323547
Lyon312444
Itasca311646
Becker309941
Isanti305354
Carlton299848
Steele299211
Pine281916
Freeborn279823
Nicollet256041
Todd246330
Brown243537
Le Sueur233920
Mille Lacs226747
Cass219124
Waseca208617
Meeker206934
Martin188228
Wabasha18613
Roseau179617
Hubbard160640
Houston157114
Dodge15154
Renville149040
Redwood146527
Fillmore13708
Chippewa135935
Cottonwood134520
Pennington131816
Wadena130220
Faribault122716
Aitkin118733
Sibley117110
Watonwan11708
Rock115614
Kanabec107319
Pipestone101424
Yellow Medicine97617
Murray9438
Jackson93310
Swift87918
Pope8025
Marshall77615
Stevens7398
Lake73518
Clearwater71914
Lac qui Parle68216
Wilkin66910
Koochiching61711
Big Stone5163
Lincoln5052
Grant4908
Norman4768
Unassigned44568
Mahnomen4417
Kittson40821
Red Lake3625
Traverse3025
Lake of the Woods2161
Cook1180

Iowa Coronavirus Cases

Data is updated nightly.

Cases: 361499

Reported Deaths: 5412
CountyCasesDeaths
Polk58007549
Linn20606312
Scott18279207
Black Hawk16223290
Woodbury14924211
Johnson1380473
Dubuque13522194
Dallas1132690
Pottawattamie10762143
Story1018945
Warren553474
Clinton542484
Cerro Gordo532781
Webster517687
Marshall495572
Sioux493469
Buena Vista472736
Des Moines457061
Muscatine450691
Wapello4314108
Jasper416266
Plymouth394277
Lee374752
Marion358469
Jones294354
Henry293037
Carroll285348
Bremer279154
Crawford273435
Boone259130
Washington253747
Benton252054
Mahaska223846
Jackson221138
Dickinson217238
Tama212965
Kossuth208154
Clay193125
Hamilton191942
Delaware188639
Winneshiek188427
Buchanan184629
Fayette184335
Page182619
Hardin180839
Wright179531
Harrison179469
Cedar177023
Clayton168053
Butler165831
Mills162820
Floyd162740
Madison154018
Poweshiek153630
Cherokee153535
Hancock146729
Lyon145941
Allamakee144946
Iowa144223
Grundy138830
Appanoose138647
Jefferson138232
Winnebago137730
Calhoun133311
Cass133351
Mitchell130640
Louisa128341
Union126331
Chickasaw124813
Sac124218
Emmet120940
Shelby120433
Franklin118419
Humboldt117225
Guthrie116228
Palo Alto104921
Montgomery103936
Howard102821
Clarke100320
Unassigned9850
Keokuk97829
Monroe93128
Adair91928
Ida90832
Pocahontas85219
Davis82523
Monona81527
Greene76910
Lucas73221
Osceola70314
Worth6947
Taylor66312
Fremont5869
Decatur5749
Van Buren56018
Ringgold51820
Wayne48721
Audubon4869
Adams3264
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