Bill Summaries: H1224 PANDEMIC EMERGENCY ASST.: RESTAURANTS/LODGING.

Tracking:
  • Summary date: May 27 2020 - More information

    Directs the State Controller to transfer $125 million for 2019-20 from the Coronavirus Relief Reserve to the Coronavirus Relief Fund. Appropriates $125 million in nonrecurring funds for 2019-20 from the Coronavirus Relief Fund to the Office of State Budget and Management (OSBM) to be used as provided in this act. Specifies that the funds remain available to expend as provided in the act instead of reverting at the end of the 2019-20 fiscal year.

    Allocates $50 million to one or more community development financial institutions (CDFI) selected by the Director of the Budget for the purpose of making loans to assist qualifying businesses with business needs during periods of economic hardship occasioned by the COVID-19 pandemic. Defines a qualifying business as a restaurant or similar establishment in North Carolina, (1) with the primary purpose of preparing and serving food subject to the taxes imposed by Article 5 of this Chapter (appears to intend GS Chapter 105) and (2) capable of showing economic losses in gross revenue of greater than 50% as a result of the State of Emergency (defined as Executive Order No. 116 and any amendments issued by executive order). Excludes restaurants with more than 25 locations. 

    Sets out requirements for the loan program, including the following. Requires prioritizing loans on the following bases: (1) the establishment is independently owned and (2) the degree to which the establishment is capable of showing greater economic losses as a result of the State of Emergency. Requires the program to be operated in two phases: in the eight-week phase one, loans may be awarded only to qualifying businesses with franchises or restaurants with fewer than five locations and with cumulative gross receipts from business activities for the taxable year of less than $10 million; in phase two, loans may also be awarded to qualifying businesses not meeting the eligibility requirement of phase one. Limits loan amounts to $50,000 per qualifying business, sets the loan interest rate at 3.5%, and prohibits the term of the loan from exceeding 120 months. Sets out conditions under which a part of the loan is to be forgiven, including when a portion of the loan is used to purchase specified products from a North Carolina small farm. Requires qualifying small businesses to certify that: (1) it will use a loan  for employee compensation, mortgage, rent, utilities, and other operating costs and expenses and (2) it has not and will not seek a duplication of benefits in the form of a loan for small business assistance authorized in SL 2020-4 and allocated to the Golden L.E.A.F. Inc. for business needs during periods of economic hardship occasioned by COVID-19. Requires working with specified entities to increase awareness of the program. Sets out requirements for the provisions to be included in the loan agreement, concerning how the loans are to be used, ensuring compliance, repayment of the loan, rejecting duplicate assistance, securing the loan, and providing for recapture of the loan. Ends the awarding of loans six months following the date that the State of Emergency ends.

    Requires OSBM to report every six months on the specified information on the program to the specified NCGA committee and division. The reporting duty ends after the submission of the report following when OSBM has remitted the entirety of the net loan funds to the Coronavirus Relief Reserve. Requires that six months following the date the State of Emergency ends and every six months thereafter, that each CDFI remit the net loan funds that have been received to OSBM to be deposited into the Coronavirus Relief Reserve.

    Requires that $75 million of the funds be allocated to one or more CDFI selected by the Director of the Budget to make loans to assist qualifying businesses with business needs during periods of economic hardship occasioned by the COVID-19 pandemic. Defines a qualifying business as a hotel, motel, or similar establishment located in this state with the primary purpose of providing temporary lodging at a per-night cost that is capable of showing economic losses in gross revenue of greater than 50% as a result of the State of Emergency (defined as Executive Order No. 116 and any amendments issued by executive order). Excludes vacation rentals by owner or other systems by which homeowners lease out space for short-term rentals using a facilitator.

    Sets out requirements for the loan program, including the following. Requires prioritizing loans based on the degree to which the business is capable of showing greater economic losses as a result of the State of Emergency. Requires the program to be operated in two phases: in the eight-week phase one, loans may be awarded only to qualifying businesses with cumulative gross receipts of less than $10 million; in phase two, loans may also be awarded to qualifying businesses not meeting the eligibility requirement of phase one. Limits loan amounts to $50,000 per qualifying business, sets the loan interest rate at 3.5%, and prohibits the term of the loan from exceeding 120 months. Sets out conditions under which a part of the loan is to be forgiven. Requires qualifying businesses to certify that: (1) it will use a loan for employee compensation, mortgage, rent, utilities, and other operating costs and expenses and (2) it has not and will not seek a duplication of benefits in the form of a loan for small business assistance authorized in SL 2020-4 and allocated to the Golden L.E.A.F. Inc. for business needs during periods of economic hardship occasioned by COVID-19. Requires working with specified entities to increase awareness of the program. Sets out requirements for the provisions to be included in the loan agreement, concerning how the loans are to be used, ensuring compliance, repayment of the loan, rejecting duplicate assistance, securing the loan, and providing for recapture of the loan. Ends the awarding of loans six months following the date that the State of Emergency ends.

    Requires OSBM to report every six months on the specified information on the program to the specified NCGA committee and division. The reporting duty ends after the submission of the report following when OSBM has remitted the entirety of the net loan funds to the Coronavirus Relief Reserve. Requires that six months following the date the State of Emergency ends and every six months thereafter, that each CDFI remit the net loan funds that have been received to OSBM to be deposited into the Coronavirus Relief Reserve.


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