Tuesday, October 04, 2005


Local businessman proposes good solution

I think this is crucial. Knowing most of the people that I have dealt with who are small-business owners, they are in desperate need of this assistance, as they struggle to find a way to keep what they have worked so hard for, and to continue to provide jobs for their employees.

The bill’s salient feature is that it would extend federal money — perhaps beginning with a fund of $10 million — to qualifying businesses in the form of short-term, no-interest loans. The loans would cover payroll and operating expenses for a specified period to enable the company to stay open until business improves to a more normal level. At the end of the stipulated period, assuming the business had lived up to its commitments, the loan would be forgiven.

“It’s a bridge,” Johnsen said. He said the measure’s goal is to help owners stay on their feet long enough to get their businesses rolling again. While a host of proposals have surfaced that would offer relief to damaged businesses in the form of tax breaks, low-interest loans and the like, Johnsen said his concern is that many companies won’t survive long enough to take advantage of those measures. “I’m afraid the short term is being overlooked for the long term, and if we don’t do something for the short term, we don’t need the long-term (measures),” he said. He admits his proposal is, basically, a grant program, except that it does include requirements to ensure that the “borrower” applies the money to keeping business alive.

Johnsen said his fear is that with many companies, small and large, struggling to continue meeting payroll after their revenue streams were disrupted, a host of bankruptcies lies ahead.

“It scares me,” he said. “Every (business owner) that I talk to is concerned about how they can cover their losses.”

Full story here

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