Small Business Relief for NYC
William and Tatiana had worked for years to open Social House Cafe on Broadway in Williamsburg, New York. As the name implies, it was meant to be more than just a coffee shop, but to be a gathering place, a part of the community. While their planning was great, their timing couldn’t have been worse. They signed their lease in November 2019 and planned on opening in March 2020. When COVID hit, all plans were stopped in their tracks and Social House Cafe was unable to open.
I first spoke to William after his landlord had sued them in state Supreme Court for back rent owed during the time when his shop was legally forbidden from opening their doors. We spoke for a while but the situation was grim. The laws in the city and state heavily favored his landlord, and there was no long-term assistance from the federal, state, or city government to cover his debts. Coffee and pastries were not going to make up for the months when they owed full rent but had no income. Nothing in the law was on their side.
That is why I am proposing a multifaceted plan to save our small businesses across our district and our city, crafted by and for their owners:
- Provide relief for small business who are in debt for months they couldn’t stay open funded through COVID-19 Bonds.
- Implement a small business legal aid and social worker program and give local businesses the tools to navigate city bureaucracy.
- Require commercial rental agreements to forgive a tenant’s obligation to make lease payments when unforeseen circumstances like terrorist attacks, hurricanes and pandemics occur.
- Centralize small business licensing so owners don’t have to run around to different agencies.
- Finally pass the Small Business Jobs Survival Act to protect businesses from massive rent increases in lease renewals.
- Create a NYC public bank to provide loans to new businesses and businesses looking to expand, with a focus on assisting women and minority owned businesses access capitol.
- Ensure the state’s $800 million small business relief grants go to local businesses that need the support the most.
With cases down and shops permitted to open with limited capacity, things have started to turn around. However, nearly 3,000 businesses in New York did not make it through the past year. When the pandemic hit our city made a choice to not protect local stores. There were no rent freezes, little support, and minimal guidance on how to navigate these difficult times.
Walking through District 33, you would have no idea that the economy was recovering. Despite a market that is supposedly booming, many beloved local businesses have closed. Storefronts that once housed pillars of our community remain empty with for-lease signs hanging in the window. If you walk into one of the remaining businesses, like one of my favorite lunch spots Lite Bites on Manhattan avenue, or a great local bar like The Springs, you’ll hear a similar story: Despite surviving the economic hardship of the pandemic, these businesses owe tens of thousands of dollars. Even those that are still open may not make it through the next few years.
In every conversation with business owners, it was clear that one of the most important things was to provide debt relief for months they couldn’t stay open. This rent burden hangs over the head of many business owners, and makes them susceptible to eviction at a moment’s notice. I’m proposing that the city release COVID-19 Bonds, similar to war bonds, to help avert this small business crisis and alleviate the rent burden that weighs on many local shops across our communities. While the stock market soars, small businesses are struggling. We can use the market investment to give back to these neighborhood institutions without putting the burden on small, community landlords. With the state passing a budget that includes over $800 million for small business, I want to make sure that money goes to those that need it the most, and is administered clearly and justly.
Throughout these processes, many businesses cannot afford the high cost of lawyers, especially if they are taken to court. I’m proposing a small business legal aid program to give local stores the tools to navigate city bureaucracy, negotiate leases, and defend themselves in court. Many businesses enter into contracts not fully aware of the legal technicalities of the documents, and without the resources to hire lawyers. Businesses that have better representation on the front end will create a more robust and durable commercial community.
The next City Council needs to pass legislation requiring all force majeure clauses in commercial rental agreements to forgive the tenant’s obligation to make lease payments. A force majeure clause is a contractual clause that assigns responsibility for unforeseeable events that would shutter a store. These are supposed to be very rare, but seem to occur every decade in New York — from terrorist attacks, to hurricanes to pandemics. When it is dangerous or impossible for a place to stay open, and earn revenue, the burden of that risk should fall on the landlords. Since they have equity in the property, they are much better able to pay for insurance against such risks. The City Council needs to finally pass the Small Business Jobs Survival Act to protect businesses from massive rent increases in lease renewals.
Finally we need to make it easier for entrepreneurs to navigate the administrative process and access capital. This starts by creating a small business social worker program to help starting businesses applying for loans and get the support they need. The city can also centralize small business licensing so owners don’t have to go between different agencies. We must also create a robust NYC public bank to provide loans to new businesses and stores that are looking to expand, with a focus on assisting women and minority owned businesses in the process of accessing capital. All too often, business owners are asked to take out personal loans or put their homes up as equity — risking everything with little support.
This plan was assembled with the input and guidance of business owners across the district. From local restaurants to innovative startups, everyone who has embarked on a commercial endeavor felt the effects of the last year. It is clear that the road to economic and commercial stability in the wake of the pandemic will not be easy. The folks across District 33 who have invested their lives in creating centers of community and hubs of innovation need the full fledged support of our next City Council. It will be the honor of a lifetime to stand as their ally.
This plan was crafted and endorsed by businesses across District 33 including:
- Shattered Prism
- The Karcher
- P & P Shipping
- The Springs
- Lite Bites
- Natural Cleaners
- KK Fashions
- Social House Cafe
- Faruque’s Gift Shop
- Gleason’s Gym
- Grace and Grit Flowers.
Learn more at Stu2021.com