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Coronavirus Resources for California Tourism Industry

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Congress approved the $2.2 trillion CARES Act to provide relief for businesses and employees hit hard by the coronavirus outbreak. In addition, California Gov. Gavin Newsom and California state government have taken immediate action help small businesses defer some sales tax payments and get loans.

Here are brief descriptions of the main components of state and federal programs, with links to more detailed documents provided by the U.S. Small Business Administration, Senate Committee on Small Business and Entrepreneurship, the U.S. Travel Association, and the California Governor’s Office of Economic Development.

Economic Development Administration Grants
Available grant funding from the U.S. Department of Commerce asks applicants to explain how their project would "prevent, prepare for and respond to coronavirus" or respond to "economic injury as a result of coronavirus.” The grant specifically includes travel and tourism marketing campaigns.
Eligibility: Applicants include a variety of government organizations and any “public or private non-profit organization or association acting in cooperation with officials of a political subdivision of a State.” Individuals and for-profit companies are ineligible.

Read more in the EDA official Notice of Funding Opportunity or the EDA’s FAQ.

Coronavirus Economic Injury Disaster Loans/Grants
This program allows small businesses to borrow up to $2 million with a maximum 4 percent interest to make payroll or most operating expenses. The loan advance part of the program has been discontinued.
Eligibility: Self-employed businesses with fewer than 500 employees (and those with more if they meet these SBA standards) and all non-profits.
Read more from Senate Committee on Small Business and Entrepreneurship (Page 7) or U.S. Travel.

Business Interruption Loans (Paycheck Protection)
This gives 100 percent guaranteed loans of up to $10 million at maximum 4 percent interest to cover payroll, rent, mortgage, utilities and other costs of doing business. Congress extended the period by which a loan recipient must use the proceeds to be eligible for forgiveness – to 24 weeks from the date of the loan or Dec. 31, whichever is earlier. 
Eligibility: Self-employed, businesses with 500 or fewer employees, with some exceptions, some non-profits. Program expired August 8, 2020, but Congress is considering an extension.
Read more from U.S. Travel and the Senate Committee on Small Business and Entrepreneurship.

Small Business Debt Relief
This allows small businesses with outstanding SBA 7(a) loans, new SBA 7(a) loans, 504 loans (for purchase or improvement of capital assets) to have all principal and interest covered for six months.
Eligibility: Any business with a SBA 7 (a) or 504 loan issued before September 27, 2020.
Read more from the Small Business Administration, Senate Committee on Small Business and Entrepreneurship (Page 6) or U.S. Travel.

SBA Express Loans
Raises the limit for express loans from $350,000 to $1 million through 2020. Interest is capped at 9.5 percent for loans more than $50,000.
Eligibility: Small businesses with 500 or fewer employees or $7 million or less in annual receipts. Must have been in business for at least two years. Non-profits and marketing organizations are ineligible.
Read more from U.S. Travel.

Business Tax Relief
Several tax provisions will help small businesses, including:

- Net operating losses from 2018, 2019 and 2020 can be carried back for five years.
- Employers can defer all of their Social Security payroll taxes for 2020, repaying half by the end of 2021 and the other half by the end of 2022. The credit is not available to employers receiving assistance through the Paycheck Protection Program.
- Employers, including non-profits, whose operations have been disrupted by government orders limiting group travel and meetings or whose quarterly receipts are half what they were year over year are eligible for tax credits for 50 percent of wages paid to certain employees. The credit is not available to employers receiving assistance through the Paycheck Protection Program.
Read more U.S. Travel and Senate Committee on Small Business and Entrepreneurship (Page 11).

Exchange Stabilization Fund
Nearly half a trillion dollars was allocated to the U.S. Treasury Department to develop loan programs through the Federal Reserve to benefit an array of impacted businesses.

The Main Street Lending Program – Allows U.S.-Based businesses with 15,000 or fewer employees and non-profits to refinance existing loans or obtain new loans through banks or credit unions. The five-year loans included deferred principal for two years and deferred interest for one year.

Municipal Liquidity Facility – Allows eligible states, cities and counties to issue bonds to cover lost tax revenue. DMOs are eligible, but only one participant per government entity can apply.
Eligibility: All U.S. businesses, non-profits, states, local governments, including DMOs, although Treasury and the Federal Reserve can determine further eligibility.
Read more from U.S Travel

California Disaster Relief Loan Guarantee Program
This provides access to loans up to $1 million for small businesses otherwise unable to qualify for federal disaster relief programs. The money can be used for rent, payroll and other costs of doing business. The state’s guarantee can last up to seven years, and interest is negotiated with private lenders.
Eligibility: Businesses with fewer than 750 employees and some non-profits.
Read more from the Small Business Resource Center.

California Business Tax Relief
Small businesses with less than $5 million in taxable sales can defer up to $50,000 in sales taxes, interest free, for up to 12 months.

A small business can claim 2020 tax credits of up to $100,000 if certain circumstances apply. Each business can qualify for $1,000 for each employee hired between July 1 and Nov. 30 if, among other requirements:

The business had 100 or fewer employees on Dec. 31, 2019.
- The business experienced at least a 50 percent decrease in gross receipts between April 1, 2020 to June 30, 2020 compared to the same period in 2019.

A business can claim a $1,000 per employee credit based on a net increase in the average monthly number of employees from July 1 and Nov. 30 compared to April 1 and June 30. Businesses can apply for the credit to the California Department of Tax and Fee Administration between Dec. 1 and Jan. 15 and claim it against either income tax or sales and use tax liabilities.

General resources: