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Restart Mississippi - Mississippi Governor and Legislature Finalize Legislation for Fund for Small Businesses

Restart Mississippi - Mississippi Governor and Legislature Finalize Legislation for Fund for Small Businesses

Yesterday, the Mississippi Legislature finalized a bill to send to Governor Reeves to appropriate and administer a portion of the $1.25 billion federal allotment to the state as part of the Coronavirus Relief Fund (CRF) provision of the CARES Act. Part of that legislation includes a framework for a direct payment of $2,000 per business and the establishment of a grants program to use up to $300 million of the $1.25 billion federal allotment to Mississippi from the CR F established by the CARES Act. The purpose of the grant fund is to reimburse businesses for cost of interruption caused by forced closures or restricted operations for eligible businesses.

The name of the Act is the "2020 COVID-19 Mississippi Business Assistance Act", and it establishes the “Back to Business Mississippi Grant Fund.” The Act consists of two assistance packages: Direct Payment and Grant Application. The following are some keys provisions of the two packages:

A. Direct Payment

  • This assistance package allocates $60 million for direct payments (meaning no application is required) to eligible taxpayers in an amount of $2,000.
  • Eligible taxpayers must be a resident or have a permanent place of business in the state and have less than 50 employees. Ultimate qualifications are based on the NAICS Codes for each business and that are listed in the legislation. A few of the eligible businesses types include: Restaurants, Salons and Barber Shops, Clothing and Retail Stores, Gift Stores, Music Stores, Florists, Movie Theaters, Schools and Art/Dance Companies, Daycares, Furniture and Floor Covering Stores, and others.

B. Grant Application

  • This package allocates $240 million and provides for grants up to a maximum of $25,000 based on the following:
    1. a base payment of $1,500 per eligible business, and
    2. at the option of the eligible business one of the following:
      1. an additional $500 per full time employee, or
      2. itemized eligible expenses (as defined by the U.S. Department of Treasury).

       

  • Funds are available to for-profit eligible businesses with no more than 50 full time employees as of March 1, 2020, that were forced or voluntarily closed or had restricted operations due to COVID-19.
  • There are restrictions on eligible business under this package based upon whether the eligible business received federal aid (PPP or EIDL) or business interruption insurance proceeds due to COVID-19.
  • Eligible businesses may not lobby Federal or State officials.
  • Grant Application proceeds will be protected from creditors.
  • $40 million of the package is set aside for minority business enterprises with Mississippi owners.
  • The Mississippi Development Authority will administer the Grant Application package. More details for the grant program are being developed by the Authority and will be coming soon.

While these funds are designated as grants, there are requirements and qualifications which must be carefully followed. Small businesses are encouraged to carefully consider these two packages and to ensure the funds are used for eligible expenses. These programs are likely to have a positive impact on eligible businesses and on the economy in Mississippi.

Prepared by:

Buffington_Phil_hs

C. Phillip Buffington Jr.
phil.buffington@arlaw.com
Jackson
P: 601.292.0745

(MCBL&F Government Affairs Committee Chairman)

Jones_Scott_hs

M. Scott Jones
scott.jones@arlaw.com
Jackson
P: 601.292.0794
Memphis
P: 901.524.5318

Majure_Matthew_hs

Matthew Majure
matthew.majure@arlaw.com
Jackson
P: 601.353.3234

(not licensed to practice law) 

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