COVID-19 Business Law Updates

maryland's roadmap to recovery and what it means for each county

On May 13, 2020, Governor Hogan announced that Maryland has entered Stage One of Governor Hogan’s Roadmap to Recovery.  Stage One lifts the Governor’s stay at home order and moves to a gradual reopening of low risk activities such as retail, manufacturing, houses of worship and personal services.  Retail and houses of worship may reopen up to 50% capacity.  Stage One continues to emphasize social distancing, good hygiene and limits gatherings to 10 or less persons.  Restaurants and bars remain open to carry out and delivery only.  Senior centers, fitness centers, malls and theaters remain closed. 

In addition, Governor Hogan’s Order provides a local community-based approach allowing each county to decide independently as to whether to reopen their local jurisdictions.  Most counties did move to Stage One in accordance with Governor Hogan’s Executive Order, with some counties choosing to remain closed.

Baltimore City, Charles, Montgomery and Prince George’s Counties elected not to move to Stage One. Anne Arundel, Baltimore County, Frederick and Howard Counties partially moved to Stage One. Stage One for each county is slightly different.  Anne Arundel County elected to have retail open for curbside pickup only; manufacturing, salons and barbershops open with safety measures; and no religious gatherings.  In Baltimore County, retail is open for curbside pickup only; manufacturing is open with safety measures; but no personal services or indoor religious gatherings. Frederick County has allowed curbside pickup at all retail; reopening of manufacturing;  limited retail at small businesses; and no personal services or religious gatherings. Howard County stated that retail is open for curbside pickup only; personal services and religious gatherings are open with strong safety precautions in place.

Stage Two of the Governor’s Roadmap to Recovery will be announced when Governor Hogan determines benchmarks for the safe rollout of additional openings of commerce and certain activities have been met. Stage Two, most likely the longest stage of the recovery, also allows county leaders to determine whether it is appropriate to resume certain activities and reopen businesses in their jurisdictions.  Examples of changes in Stage Two include:

  • Raising the cap on social gatherings
  • Indoor gyms and fitness classes
  • Childcare centers
  • Transit schedules begin returning to normal
  • Indoor religious gatherings
  • Restaurants and bars with restrictions
  • Elective and outpatient procedures at hospitals

The final stage, Stage Three, will involve the reopening of high risk activities. Examples of changes that could be implemented in this stage include:

  • Larger social gatherings
  • Reopening of high-capacity bars and restaurants
  • Lessened restrictions on visits to nursing homes and hospitals
  • Reopening of entertainment venues
  • Larger religious gatherings

There is no realistic timeline for each stage, however, in determining when to move to the next stage, Governor Hogan will continue to review data focused on rate of hospitalizations and the number of patients admitted to the ICU.  At each stage it is important for businesses to be aware of the Governor’s Executive Orders and interpretive guidance in reopening your business.  As each business reopens it is critical to develop a return to the workplace plan and communicate that plan to your employees.  If you need assistance in preparing return to the workplace policies, please contact us.

 

Main Street Lending Program Provides Relief to Small & Medium-Sized Businesses

On April 9, 2020, the Federal Reserve announced details of a $600 billion lending program to provide support for small and mid-sized businesses. The Main Street Lending Program uses funds allocated to it by the Coronavirus Aid, Relief and Economic Security (CARES) Act and is designed to provide some relief to small and mid-sized businesses impacted by COVID-19.

Who qualifies for a Main Street loan?

Businesses with up to 10,000 employees or up to $2.5 billion in 2019 annual revenues may be eligible for a Main Street loan. Eligible borrowers must be created or organized in the United States and have a significant portion of its operations and the majority of its employees based in the United States. Borrowers participating in the Main Street program may either borrow a new loan or borrow more under an existing eligible loan, but not both. Borrowers who participate in the Primary Market Corporate Credit Facility program (a lending program aimed at large employers) are also not eligible for a new loan under the Main Street program. Loan proceeds may not be used to refinance or pay down any of the Borrower’s existing loans. 

Where can I apply for the Main Street loan?

Applicants for Main Street loan can apply with a U.S. insured depository institution, U.S. bank holding company or U.S. savings and loan. 

What is the maximum amount of the loan?

Loans of a minimum of $1 million up to a maximum of (i) $25 million or (ii) up to four times the Borrower’s 2019 earnings before interest, taxes, depreciation, and amortization (when combined with the Borrower’s existing outstanding undrawn debt) are available with a 4-year maturity at a variable rate of interest. Loan payments will be deferred for one year.