COVID-19 Crisis: Highlights from “Understanding the CARES Act: Actions You Should Take Today” RSPA Webinar

by Jim Roddy, VP of Sales & Marketing at the RSPA

To help VARs and ISVs better navigate the CARES Act (Coronavirus Aid, Relief, and Economic Security Act), RSPA Legal Counsel Bob Goldberg hosted a webinar on Wed., April 1, to highlight key sections that apply to solution providers. The CARES Act is the U.S. government’s $2 trillion aid package designed to provide economic relief to businesses and individuals impacted by the COVID-19 pandemic.

I encourage you to watch the entire webinar (including lengthy Q&A session) on-demand as soon as possible – via the RSPA YouTube channel here or association members can download the slides and audio here. I tuned in live and came away with several notes that would apply to VAR and ISV executives.

As I previously stated in my blog post recapping the March 18 RSPA COVID-19 Communications Guidelines webinar, please use my highlights only for reference, not as a replacement for watching the webinar. View every minute and capture every detail that applies to your individual business situation. Don’t take shortcuts during this crisis; don’t be derelict in your duties to protect your employees, your customers, and your organization. First-rate leadership is required to successfully navigate your business through this unprecedented storm.

For additional questions related to the COVID-19 crisis, please lean on the RSPA community for guidance. Atty. Goldberg is available for member questions at Bob.Goldberg@SNFR.com and you can visit the RSPA COVID-19 Resource Center here.

  • Don’t be surprised if you hear something on Tuesday and then something different on Wednesday. It’s the rolling nature of these guidelines. This has still not been interpreted fully.
  • There are a number of drop-dead dates when these programs cease. But this is phase three and congress is already talking about phase four, so those dates could be extended.
  • The CARES Act is designed for you to keep your employees, even if they’re quarantined and work remotely.
  • The key provision is the PPP, the Paycheck Protection Program. The maximum loan is 2.5 times your average monthly payroll up to $10 million. That includes salary, commission, vacation/PTO/sick time, health insurance, severance, state/local taxes, but it excludes compensation over $100,000 and federal payroll taxes.
  • These loans are guaranteed by the SBA (U.S. Small Business Administration), but they are being administered by SBA-approved banks. You should be reaching out to these banks if you’re interested in the Paycheck Protection Program.
  • SBA is saying their turnaround time is 10-15 days on these loans. That’s pretty good.
  • The full amount of the PPP loan can be forgiven. If you have 15 employees in the period the loan covers, and you retain 15 employees in that time period, you would be eligible for 100% forgiveness. This is a very attractive program.
  • The Economic Injury Disaster Loan (EIDL) program is also attractive. If you’ve been injured by COVID-19 – and we have – you may be eligible. I think many of us will want to apply for this. The amount is attractive, and it may be helpful.
  • You may also file for an Economic Injury Disaster Grant. You had to apply for the EIDL loan in order to qualify for the grant – up to $10,000 to pay for payroll, healthcare, mortgage, rent, utilities, and interest. In some cases, you won’t have to pay that $10,000 back.
  • You have to speak to your accountant about the new tax credits that are available. These tax credits are complex. Talk to your accountant about what works best.
  • Independent contractors, self-employed, sole proprietors – people who normally didn’t qualify for unemployment benefits – do now under some of these programs.
  • It’s never too early or too late to start cross-training individuals in case someone on your team becomes unavailable.
  • Do a cash-flow projection for the next six months. That will help you determine which of the government programs you should try to take advantage of. Look at what you have, make adjustments, and proceed from there.

For additional details, review the CARES Act Section-by-Section Overview, a 35-page document Goldberg provided, that highlights important sections from the nearly 900-page law including:

  • Paycheck Protection Program
  • Entrepreneurial Development
  • Loan Forgiveness
  • Emergency EIDL Grants
  • Pandemic Unemployment Assistance
  • Financing of Short-Time Compensation Agreements
  • Employee Retention Credits for Employers

For additional questions related to the COVID-19 crisis, Goldberg is available for member questions at Bob.Goldberg@SNFR.com and you can visit the RSPA COVID-19 Resource Center here.

Jim Roddy is the Vice President of Marketing for the Retail Solutions Providers Association (RSPA). He has been active in the POS channel since 1998, including 11 years as the President of Business Solutions Magazine, six years as an RSPA board member, one term as RSPA Chairman of the Board, and several years as a business coach for VARs, ISVs, and MSPs. Jim is regularly requested to speak at industry conferences and he is author of Hire Like You Just Beat Cancer. For more information, contact JRoddy@GoRSPA.org.