IN THE LOOP
The latest from the folks across the street from the Capitol

From Paddi's Desk
by Paddi LeShane

Knowledge is telling the past. Wisdom is predicting the future.

It's been another week of tense and stressful living in these United States. The seemly never ending barrage of media stories about the public health emergency facing us all and the minute by minute actions by federal, state and local governments have all of us swirling.

Historically, questions for this week in our lobbying firm would have been: What's on the agenda in the XYZ committee? Does it have substitute language, and what does it do? Are there enough votes to pass/kill the bill? What's the next step if it gets out of committee?

Not one of those questions were heard in Sullivan & LeShane or in the halls of state government. Our team has been busy helping clients access the resources they need to keep their shops and doors open, to retool their operations to fill voids and to turn the vulnerabilities they face into an opportunity to do good things. From childcare providers to manufacturing, physician practices to power generators, telecommunication to technology services, we've been connecting the dots and making things happen.

After last week's announcement by the Governor of a de facto shutdown of in-office businesses/workplaces, employers were faced with how to keep employees safe but engaged so their businesses could continue to do business. Unfortunately, many have not been able to find that balance. Well over 100,000 employees have been laid off while many others are using their leave time to cover their absences from work with little knowledge of when this all will end.

What we know for sure is that normal will never be normal. Down the road, the new normal will be a smaller business community and a government that has made enormous accommodations in regulatory operations, policies and general operations in order to keep the doors of industry open.

In another story in this newsletter, we update you on the top line of both CT's new economic package for businesses and municipalities as well as the just approved federal plan for stimulating a variety of sectors like healthcare, manufacturing, education and large and small businesses. So, I'll stay away from that.

I did want to bring attention to the forgotten folks who are trudging away in the state, town and city halls, struggling to balance the need to keep their community safe, provide the support where ever possible but also to figure out how they are going to pay for the immediate needs to meet all those requirements. With folks out of work and the second half of local property taxes due in July 1 st, town leaders are thinking about how to secure the approval of their town budgets, float the increased education costs as well as develop a long-term plan for keeping their town's business and industry alive until better days.

Then there's the state elected and appointed officials who for the past three weeks have been working 24/7. They've been on the front lines gathering information, assessing and making tough recommendations on how to create a stable base to start rebuilding. With no ability to predict when the self-isolation and social distancing restrictions can be lifted, many are talking about when it's appropriate to pivot to what's next - creating the new normal.

Now, my last observation from this week. With fall elections coming up in eight months, we're starting to see long-time, respected members of the General Assembly announce their plans to retire and not seek re-election. It would not surprise us if we see an unusually large group of legislators who announce their departure in the next three to four weeks. With the looming budget issues of FY2021-22 as a result of already baked in deficits in the state budget and now the expectation of a drain on the rainy day fund as well as the significant drop in state revenues, many see this as the time to hang up the shoes.

For them, the race is about to end. We'll keep you posted.
 

CT Agency Corner
Federal and State Relief Packages 101
by Michael Johnson

This week, both federal and state government officials introduced new economic relief programs for businesses, hospitals, non-profits and others to take advantage of during this period of economic duress.

The first program outlined is the $2 trillion federal stimulus package which passed the U.S. Senate Wednesday night and passed the House earlier this afternoon.

In short, businesses are able to take advantage of the following programs once implemented:
  • There's a provision in the package  that would allow businesses of 250 employees or less (pending final legislation) to apply for a loan forgiveness program for maintaining current employment numbers over a certain period of time. The loan is administered directly by a private financial lender rather than the U.S. Small Business Administration (SBA), but keep in mind a personal guarantee or other securitized collateral is required.
  • The CARES Act also includes $349 million for the SBA to guarantee loans through its 7(a) loan program. The SBA is also offering Economic Injury Disaster Loans for qualifying small businesses which are 2.75% for non-profits and 3.75% for businesses. The terms are potentially as long as 30 years for small businesses and nonprofits and you can apply for an SBA loan through its site.
  • The Federal Government and private financial lenders are working on additional programs that are set to launch as soon as the bill is signed into law. Here is a link to all of the programs expected to be made available upon passage for each of the FDIC insured institutions. 
The state of Connecticut has also instituted a zero-interest rate bridge loan program titled "Bridge to Recovery". Here are the conditions of that loan:
  • Loans were made available for 18 months (one year first, then a six month extension after additional DECD approval).
  • Approval of these loans is contingent upon a business being profitable prior to March 10, 2020 and no adverse personal credit reports 60 days past due in the last six months.
  • Personal guarantee and credit score required.
  • Ineligible companies include those involved in real estate, multi-level marketing, adult entertainment, cannabis and firearms.
 

Did You Know?
This Month in CT History
March 16, 1977
Connecticut Chooses An Official State Song

In late 1977, temporarily setting aside the politics of a struggling national economy and election-year posturing, the Connecticut General Assembly took up the task of selecting an official state song for the state of Connecticut.  The request for a state song first came from then-governor Ella Grasso's predecessor, Thomas Meskill, who was reportedly sick of hearing Yale University's fight song, "Boola Boola," being played whenever he showed up at official functions as Governor.

After months of debate, Representative (and future governor) William O'Neill proposed replacing the word "girls" with "folks" in the chorus of "Yankee Doodle" in order to eliminate any possible hints of sexism the original song may have contained.  

O'Neill's proposal made "Yankee Doodle" palatable enough for the state House of Representatives to pass a motion making it Connecticut's state song on March 9, 1978.  After voting down a proposal by then-state senator Joseph Lieberman to include a reference to "Boola Boola" in the agreed-upon lyrics, the state Senate followed suit, voting to make "Yankee Doodle" Connecticut official state song on March 16, 1978.

In This Issue:

Municipal
Roundup
by Ryan Bingham

In this new era that we're all embarking on together, this week we wanted to focus our municipal roundup on what municipalities are doing to continue to function in different and unique ways. The show must go on, and we want to share how. 
 
The town of Vernon held a drive-up town meeting on Wednesday, a continuation during extraordinary times of a centuries-old staple of American democracy. "We've got to keep business moving," said Town Administrator Michael Purcaro. "Shutting down is not an option for us." Voters dialed into a virtual public hearing at 7:35 p.m., then motored up to the front of town hall to vote before 9 p.m. that night. With car windows closed, they showed their drivers' licenses to town workers in protective gear, then gave a thumbs up or down to the proposal, a shifting of about $3 million in town funds to eliminate internal vehicle leasing debt and avoid an adverse impact on the tax rate. Even though an executive order by Governor Lamont allows for municipalities to have flexibility in terms of requiring votes for referendums, town meetings and budget deadlines, Vernon chose to find a new way to keep the public in control of decision making for the town.
 
At least two city officials have turned to live social media platforms to expose residents to the inner workings of local government as a way to ensure transparency as well as encourage engagement. Middletown Mayor Ben Florsheim, 27, began reporting from his office in February about items on the Common Council's monthly meeting agendas. The videos, between 15-25 minutes in length, are made within the half-hour before Florsheim heads down to the session in council chambers. The idea originated from his visit a couple of months ago with New Britain Mayor Erin Stewart, 32, who took office in her mid-20s. "She is particularly good at social media, and constituent engagement using new technology and new platforms. This is a great thing for us to do, because I'm very orientated toward opening up city government, and making sure people know what's going on, and it's easy for them to find out what's going on," Florsheim said.
 
We will be keeping track of new and innovative ways that Mayors, First Selectmen and town leaders use engage with the public as we are all having to sacrifice our normal course of business to keep others safe. Kudos to those using chaos and uncertainty to find opportunities and innovation.

Executive Order Update
by Chelsea Neelon

As the nation has seen the spread of COVID-19 progress across all 50 states, Governor Lamont called has continued to use his power to create executive orders to ensure the overall public health and safety of CT's residents.

We want provide you a deeper dive into Governor Lamont's executive orders since last Friday, March 20th. Learn more below.

* Regarding municipal operations and availability of assistance and healthcare

* Clarifying Executive Order 7H regarding operations at nonessential businesses and providing for rapid state government emergency response. 

* Remote notarization, suspension of non-critical probate and workers' compensation operations, and various measures of public health. 

* Extension of school cancellation, municipal retiree reemployment, open fishing season and addtional public health measures. 

* Extension of agency administrative deadlines

* Increased distancing, expanded family assistance, and academic assessment suspension.