“You are the engine that will drive our recovery,” State Sen. John Brooks told a group of small-business owners at a webinar on July 16, as he introduced a panel of experts he had invited to offer tips and discuss programs and new legislation designed to aid local businesses in the coming weeks and months.
The Seaford Democrat did not understate the importance of small businesses to local communities. According to Nassau County Comptroller Jack Schnirman, sales tax accounts for roughly 40 percent of the county’s annual revenue. And in a report released last month, Schnirman said that losses for the current fiscal year could be as much as 12 percent of Nassau’s $3.2 billion budget — or more than $380 million — as a result of coronavirus-related sales tax losses.
By the end of next year, losses could total as much as $1 billion, Schnirman said.
As primarily residential communities, Seaford and Wantagh depend heavily on property taxes to finance schools and libraries. Before the pandemic, the two school districts’ property taxes accounted for more than 70 percent of the schools’ revenue, the largest portion of which was residential taxes. Sales tax revenue provides the only significant relief for local property owners.
A majority of businesses in the two communities are in the service or hospitality sectors — the two sectors hardest hit by the virus. According to a report released on July 16 by Nassau and Suffolk County Executives Laura Curran and Steve Bellone, the counties have lost more than 80,000 jobs in the hospitality sector alone since the beginning of March. They lost another 59,000 jobs in health care, and 52,000 in retail.
Curran de-scribed the past four months as the “the fastest rise of unemployment on record, leading to a complete fall-off of economic activity.” Minority-owned businesses and jobs at the lower end of the spectrum have been hit hardest, with 68 percent of lost jobs paying less than the county’s $61,600 average salary.
Many jobs are expected to return as the communities slowly reopen. But even if Seaford and Wantagh eventually return to pre-pandemic levels of prosperity, the recovery up to this point has been slow.
The panelists at last week’s event included Robert Piechota, regional director of the Small Business Administration; Huey-Min Chuang, senior executive for business development at Empire State Development Corp.; and Lauren Linakis, a small-business development officer at SUNY Farmingdale.
Linakis said her office has helped more than 33,000 small businesses since it opened in 1985. Besides helping local businesses tap the full range of available coronavirus recovery resources, she said her team can help analyze how businesses can reposition themselves for the “new normal” — the post-Covid world, which will require a much more robust internet presence, including the ability to leverage social media and capture customer information.
Linakis also emphasized networking with local chambers of commerce.
Marilynne Rich, second vice president of the Wantagh Chamber of Commerce, agreed, saying that her organization’s membership had grown by about 30 percent during the lockdown. A social media consultant, she said that members were contacting her as they looked for new ways to grow their businesses.
“Businesses can reach out quickly through social media,” Rich said. “We did almost all of our advertising for [last year’s] St. Patrick’s Day Parade on social media.” The event drew more than 50,000 spectators, despite fewer than eight weeks of lead time. And tickets for the chamber’s free summer drive-in movie series in Wantagh Park, which was set to begin on Wednesday, after the Herald-Citizen went to press, were gone within an hour of being offered on the chamber’s Facebook page. “That’s just a small example of the power of social media,” she said.
“I think people will definitely return to brick-and-mortar stores once this is over,” Rich said. “People like to shop in person. They like to try things on, to talk with the people they’re buying from.” She sees social media as a new avenue for businesses, rather than as a substitute or replacement for traditional approaches.
And as larger companies reduce their social media presence because of this summer’s controversies, such as Twitter’s refusal to publish all of President Donald Trump’s tweets, as well as Facebook’s blocking of some racist remarks following the murder of George Floyd in May, Rich believes that will create more opportunities for small businesses.
Piechota’s presentation, outlining SBA programs that are available to small businesses, inadvertently highlighted some of the problems that have plagued recovery and stimulus programs from the start. Much of the initial $359 billion Payroll Protection Program went to larger, publicly traded companies, according to news reports. As a result, Congress had to authorize an additional $350 billion for small businesses.
But changes in protocols stymied many local businesses as well. During the initial stages of New York’s four-phase reopening, for example, even businesses that appeared to meet the state’s guidelines for reopening were hesitant to do so. “We weren’t sure,” said Christine D’Angelo, co-owner of D’Angelo’s Sporting Goods in Wantagh. Although the business she owns with her husband, Mike, appeared to meet all the Phase 1 guides, “We decided to wait another couple of weeks, until the rules were clearer,” Christine said.
The D’Angelos did not apply for funds under the PPP program, because the business has no employees. But Tony Smith, owner of SAS Realty in Wantagh, said he relied on his financial institution for assistance with both the PPP and Economic Injury Disaster Loan programs, because of the complexity of the rules and changes as the program progressed.
In addition to small businesses, PPP is available to nonprofits and landlords, Piechota said. Many landlords have experienced serious cash-flow difficulties as rent freezes and moratoriums on evictions have reduced rental income. And nonprofits, many of which operate critical services, such as food pantries, have seen monetary contributions plummet during the pandemic, he said. A percentage of PPP has been allocated to both nonprofits and landlords, with different protocols for each.