Will California’s restaurants survive an extended lockdown?
Slapfish Restaurant Group CEO Andrew Gruel weighs in on Gov. Newsom’s call to lengthen California’s stay-at-home orders and its impact on small business.
Ever since California went into lockdown to mitigate against the spread of COVID-19 last March, many of the state's "non-essential" businesses have taken their chances operating underground to try to stay above water.
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Dozens of businesses in Los Angeles alone have been charged with violating Mayor Eric Garcetti's "Safer at Home" order.
Los Angeles City Attorney Mike Feuer has charged dozens of businesses with violations, including car washes, tobacco shops, beauty supply stores, massage parlors, nail salons, pet groomers, and an Egyptian artifact store.
CALIFORNIA LOSES HUNDREDS OF THOUSANDS OF RESIDENTS IN 2020
The owners of one Bay area massage business made the decision to reopen underground after 93 days on no income, telling Cal Matters that it came down to either paying "the fine or we can’t pay our mortgage,”
Business owners who made the decision to go underground have turned to discreet measures to stay off the radar of authorities.
A California pet groomer told Politico in November that she meets clients in a back alley, then leads their dog through an entrance that reads "closed due to coronavirus."
A tattoo artist told Politico that he has reverted to appointment only in his parlor, and keeps the lights off and the curtains drawn when working with a client.
It's not just fines that these underground business owners face. The Los Angeles Mayor said in a recent "Safer at Home" decree that "individuals, businesses, and properties which fail to comply with this Order may be subject to having their utility services shut off by the Department of Water and Power."
CALIFORNIA'S CORPORATE RESIDENTS HIT THE ROAD FOR BUSINESS-FRIENDLY ALTERNATIVES
Small businesses have received some help from the government.
The Treasury Department just revived the Paycheck Protection Program nearly half a year after funding first ended. Businesses with less than 300 employees that suffered at least a 25% drop in quarterly revenue can borrow up to $2 million, and the loans can be forgiven if 60% of the money is used for payroll.
That aid only went so far for many businesses though.
“That amount of money came in and covered the costs of one month,” the massage business owner told Cal Matters. “With the PPP loan, you had eight weeks that you had to use those funds for payroll and utilities… It looked like I gave myself a big raise, but it just kept me afloat for those months that I was behind.”
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97,966 small businesses closed permanently last year due to COVID-19, according to a Yelp economic impact report.
More will close as the pandemic continues to ravage California and the rest of the country. California recorded 22,972 new cases and 593 deaths Friday, bringing the state's totals to more than 3 million cases and 36,361 deaths.
The Associated Press contributed to this report.
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