It’s no surprise that small businesses are being hit—hard—by social distancing policies. Many have announced closures, while others have tried to transition to virtual models of their product. Some restaurants are temporarily shuttering, others are trying to lean on take-out and delivery—perhaps even for the first time. But a common thread throughout all of these efforts is the community’s desire not to give up. And it’s this desire—to organize, to collect data, to lobby for each other—that is embodied by the Grassroots Relief for Main Streets project, spearheaded by main streets and district associations across the region.
The Grassroots Relief for Main Streets is an expansion of the District Impact Study published by the Central Square Business Improvement District (BID), which also includes data from East Cambridge and Union Square. The surveys work to assess the damages done to the neighborhood businesses by the outbreak of COVID-19 and to push the state to consider a set of recommended relief measures for small businesses.
Collaborating Across Neighborhoods
The idea for these neighborhoods to collaborate was inspired by Nina Berg, who is the communications and creative director for the BID, according to Zachary Baum—a co-owner of Bow Market in Somerville who is one of a few people taking a leadership role in the Grassroots Relief study.
“Nina, I would say is connecting the dots between us,” Baum says.
“We were reaching out to other business associations to compile more testimonials and data,” Berg says. “Partners at East Cambridge Business Association, Bow Market, and Union Square Main Streets (USMS) in Somerville helped strengthen the argument that emergency relief is needed urgently. Within days, the data points went from sales decline to layoffs.”
Baum and his business partner Matthew Boyes-Watson have worked closely with Berg before on issues related to small businesses, and she has also previously worked with Jason Alves of the East Cambridge Business Association (ECBA). Jessica Eshlemen and Michael Monestime, executive directors of USMS and the BID, respectively, are also key members of the team.
The BID presented their original impact survey to the City of Cambridge on March 15, following two days of data collection. After Berg got Baum, Boyes-Watson, and Alves involved, they got to work adjusting the BID’s original questions and collecting their own data. The data collection period ended at midnight on March 17, Baum says, and the next day was spent compiling and organizing the data.
Similar to the BID’s individual study, the regional impact survey catalogues reactions from business owners, and lists their respective number of years in Central Square, number of hourly employees, and the perceived nature of impact.
The various natures of impact include drops in sales, staffing issues, reduced hours, closures, layoffs, event cancelations, and decline in philanthropic giving, among others.
“We were hearing from our local community that foot traffic was down, sales were down, events and bookings were being cancelled,” Monestime says. “Our office is in the heart of Central Square, so we could see that, just walking down the street. We knew we had to move quickly.”
The data from each section conveys a dire situation for local businesses. In Union Square alone, less than 37 percent of business owners reported that they could stay in business through April 7—the current end to the existing Massachusetts state of emergency. If the state of emergency is continued through May 31, then only 10 percent of owners believe they could stay afloat.
“The word on the street in Central Square is devastating,” Monestime says. “Right now, there are mass layoffs of wage workers; businesses will soon be defaulting on loan and rent obligations; many may never open again.”
“We will need massive investment from all levels of government to recover,” writes Jason Alves, ECBA executive director, in a letter preceding his neighborhood’s data.
Recommended Relief Measures
The data communicates a need for an urgent response, which led to the grassroots team compiling a list of recommended relief measures that they are currently trying to get in front of state representatives.
Their new set of recommended relief calls on the state to: establish an emergency relief fund for small business grants; require insurance companies honor business interruption insurance policies; waive state and local sales tax, meals tax, and payroll tax; enable municipalities to provide tax credits for rent rebates; mandate immediate mortgage relief to support small businesses; expand unemployment insurance to support all workers; and suspend evictions for small businesses.
The two most urgent needs among business owners across Union Square, Central Square, and East Cambridge—as determined by Baum, Boyes-Watson, Eshlemen, Monestime, and Alves, based on the data collected—are rent relief and cash flow. These two needs informed the list of recommended relief measures, says Baum.
The group took issue with relief measures put out by the state that focused on loans, according to Baum, because they could be a hindrance to business owners in the long-term.
“If an organization or a business were taking out a loan now, that might help in the short-term, but it actually could put them in a worse shape in the future,” Baum says. “They’d be having to service that debt, along with their normal cost of business. Small businesses run on razor thin margins as it is.”
Emergency Relief Rent Rebate Tax Credit
This report also introduces a municipal relief program—the “brainchild of Matthew Boyes-Watson,” says Baum—meant to help both small businesses and their landlords. According to its overview in the report, if permitted by the state, “the program would allow municipalities to offer credits against future real estate taxes to landlords who provide rent rebates to eligible tenants impacted by COVID-19.”
If the state of Massachusetts were to approve this program and a municipality were to adopt it, then landlords would be able to receive credits for the amount of rent rebated to eligible tenants—with limitations, such as the total amount of credits not permitted to exceed the previous fiscal year real estate taxes.
“This is a mechanism to ensure that renters that need it are able to get rent relief from someone,” Baum says. “The basic thinking goes like this: Property taxes are one of the largest sums of money that commercial businesses pay to the city in a given year. … What our recommendation does is incentivize property owners to pass that relief on to lease holders.”
Unlike a moratorium on mortgage payments, which primarily helps property owners but does not necessarily protect renters, this program takes into account both the landlord and the tenant.
“This is a way for the cities to incentivize landlords to give rent relief to their tenants, while giving landlords the relief that they would also need from not getting that rental income,” Baum says.
However, because property taxes are an important revenue source for municipalities, Baum says the team is “looking at different opportunities to backfill that loss tax income” in the case that the program is adopted by a city.
“Some municipalities may say, ‘Yep, we can do this,’ and some may say, ‘No, we can’t afford this.’ And our hope is to find additional funding sources so that more municipalities would go for it.”
The current challenge is getting the report on the right desks at the statehouse.
The first step has been coordinating with municipal officials. In Somerville, the team has been focusing on communication with the Economic Development Department and the City Council, according to Baum. The feedback that the group has received from the City so far led them to refocus their attention onto the state, he says.
“Some of the feedback we got really early on, even two weeks ago, is that the amounts of money that the state and the national government would be able to pay to this just dwarfs what the City could do—and to sort of turn our attention that way, and use the City to try to strengthen arguments where they could and get specific support,” he says.
“We sent the report and emergency measures to state electeds, recognizing the City had limited ability to act,” Berg echoes. “That said, Mayor Siddiqui was the first in Cambridge to sign in support and has stayed in close communication about our progress. Rep. Connolly’s office was extremely helpful in directing our efforts.”
As of March 26, Berg says they are working closely with Rep. Jay D. Livingstone, who represents parts of Boston and Cambridge. Livingstone is helping to connect the team further with his colleagues in the state legislature.
A few days prior, Massachusetts, State Senator James B. Eldridge filed a bill entitled “An Act Concerning Business Interruption Insurance,” which, if enacted, would be a step in the right direction for small business owners. This bill would require insurers to pay policy owners who had their business interrupted by the viral outbreak.
A Grassroots Effort
The report has been undersigned by 63 different organizations, business owners, and officials across Somerville, Cambridge, Medford, Boston, Malden, Chelsea, Woburn, Brookline, and Ipswich.
This was accomplished by “calling everyone we know,” Baum says. “We were just calling and emailing folks that we knew would get behind something like this.”
“We’re in go mode on many fronts,” Berg adds. “Organize, advocate, mobilize, repeat.”
Baum is proud to call this a grassroots effort, with so many constituents stepping up to collect data, signatures, and leverage their networks to help this report reach state legislators.
“Senator Warren put out her call for the stimulus and these bailouts to be grassroots-based, and we think that is what we’re putting forward,” he says. “What we realize at this point is that we’re not looking for each individual organization or city councilor to support these entirely at face value, but we’re hoping that they could support them as the relief efforts that their constituents have come up with… Even if they don’t support all of the content, they support the grassroots efforts that went behind collecting them and presenting them.”
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