May 14, 2020
If the global health pandemic, economic crisis, and soaring local unemployment weren’t giving you night sweats yet, the heatwave and red tide stench might have done the trick. However, there may be some light at the end of the coronavirus tunnel. Governmental leaders are all looking at a phased reopening, creating an important window for businesses to provide feedback for suggested ways to make that reopening stable, safe, and successful.
UCSD made a major announcement regarding testing as part of its plan to bring students back for the Fall, demonstrating capacity and ability to test which will be critical to larger strategies of reopening.
While the challenges and confusion of the Paycheck Protection Program and the EIDL loans are well documented, there are new questions for those who have received funds who are concerned about adhering to vague guidelines. Additionally, a recent study from Paychex highlights uncertainty from the business community members who have been awarded funds, but not received, and/or their plans for spending.
New guidance has been published for state and local governments clarifying that CARES Act money allocated to them can be used for rental assistance, among other things.
Congress had begun debating what will be included in the next round of federal legislation. Having already passed four COVID-19-related packages totaling nearly $3 trillion, it is likely that this next phase will be the most contentious, as congressional Republicans and Democrats continue to disagree. Policy priorities that are being considered in the next stimulus bill include assistance for state and local governments, expansion of refundable tax credits, liability protection for businesses, green energy tax credits, and reversing IRS guidance to allow businesses to claim tax breaks if they continue to pay health benefits for furloughed workers.
Baja’s Secretary of Health has issued a ‘Manual for Creating COVID-19-Free Work Spaces’ (available here in Spanish) with clear protocols for businesses to implement in order to protect their workforce while ensuring continuity of operations. In addition, state officials continue to work with business organizations including the Chamber to obtain requests from essential businesses seeking to remain open. If you are an essential business and are seeking authorization to remain open, please contact Paola Avila (email@example.com) or Kenia Zamarripa (firstname.lastname@example.org).
U.S. Customs and Border Protection revised their operational hours for SENTRI/Global Entry lanes at the Otay Mesa port of entry. New operating hours for SENTRI/Global Entry vehicle lanes will be 6:00am to 10:00pm. Please note that Otay Mesa border crossing remains open 24 hours per day and SENTRI/Global Entry members are able to use the Ready Lanes, designated for travelers with RFID-enabled documents when crossing at other hours. Please visit the official DHS web and social media pages for updates on port operations.
Cross Border Xpress (CBX) northbound operations will no longer be available between midnight and 8:00am daily starting May 10. CBX will continue its southbound operations as normal, open 24 hours a day. For more information, visit the CBX website.
In Tijuana, the Zonkeys basketball arena was transformed into a COVID-19 hospital with the help of local authorities and nonprofits. Baja’s Secretary of Health, in collaboration with Doctors Without Borders, oversee operations. The facility is equipped with 50 beds, bathrooms, a special care section, and a sanitation area to ensure medical staff and patients are protected. Counseling services are also offered to family members at a designated space outside of the hospital.
The Mexican federal government designated the Los Pinos cultural complex, former official residence and office of the President of Mexico, as housing for medical personnel working in local hospitals that have been the most affected by COVID-19 cases. Los Pinos has been outfitted with all necessary supplies services including food, laundry facilities, and transportation to and from these hospitals.
On Monday, the Governor announced that California will be prepared to move into the early phase of Stage 2 of reopening this Friday. Stage 2 includes the gradual reopening of lower-risk workplaces such as retail, including clothing stores, toy stores, sporting goods stores, bookstores, and florists (just in time for Mother’s Day on Sunday). Other sectors that are considered part of the Governor’s Stage 2 announcement last week, like offices and dine-in restaurants, will be part of a later reopening. Here you can find guidance on how Stage 2 businesses can reopen, divided by industry. The Governor also announced that counties can move more quickly through Stage 2 if they can prove their jurisdictions have met the state’s readiness criteria, which will be announced by the State Public Health Department next Tuesday.
Governor Newsom issued an Executive Order this week that provides the assumption that a worker who contracted coronavirus did so while working (if doing so from their place of work), making them eligible for worker’s compensation claims. This continues friction between some business groups, insurers, and labor as costs are expected to be significant.
The state legislature has changed a number of its timelines due to the coronavirus. The policy deadline that was April 24 is now May 29. The Fiscal deadline that was May 29 is now June 19. The House of Origin deadline is now June 26. The Senate plans to take one week of recess from July 3- July 12 and will return to session on July 13. All revised dates are proposed and require formal approval. The Assembly House of Origin deadline will be June 19. The Assembly will take a three-week recess beginning June 19 and continuing through July 12, returning on July 13. After July 13, the calendars for both the Senate and Assembly will be aligned.
You’ll recall that state budget timing and process have adjusted, however, early reports indicate that the state budget deficit will be even higher than projected – possibly reaching over $50 billion. The Department of Finance issued a budget update on May 7 (which includes very concerning data points including personal income tax being less than 25% of January’s prediction, and sales and use taxes being less than 27% of the prediction).
On Tuesday the County Board of Supervisors unanimously approved the Reopen San Diego Business Safety Framework, which includes a provision to request complete local control of the reopening process from Governor Newson. Per Governor’s early Stage 2 reopening guidelines, businesses that are allowed to reopen must create and publish a Safe Reopening Plan. A sample plan template provided by the County can be found here.
The Board also approved a proposal to allocate $5 million for childcare vouchers for essential workers (using funding from the federal government via CARES Act), with the caveat that the City of San Diego also contribute $5 million for the same effort (also using CARES Act funding).
The City of San Diego also looks to move closer to opening in coordination with the County and in consultation with the RECOVER task force that the Chamber participates on. The San Diego Ready strategy can be reviewed in full here.
This week, the City has held (virtual) budget hearings. There is general concern regarding how best to absorb the need for significant reductions city-wide. Another important factor is federal CARES money that has been allocated to local governments. The City of San Diego’s allocation is $248 million, but that comes with limitations and many questions. For a full review of the proposed budget from the Office of the Independent Budget Analyst, visit here.
The agenda for the May 12th City Council meeting may be accessed here.