The recent restrictions remind us that the coronavirus is not going away soon. Let's all do our part to stay safe and to help make safe environments for others!
-- Brenda Rees, Biz Buzz Editor
Contact me at brenda@TheEastsiderLA.com
Time to read the fine print on your lease
Small business owners have a lot on their plates these days. On top of wearing a multitude of hats, owners are navigating through the COVID-19 landscape and new operational guidelines.
Local Los Angeles organizations that have offered free legal advice for decades are being overwhelmed with strikingly similar questions from small business owners.
“We have seen a dramatic shift in questions,” says Rachael Ettinger, a staff attorney with Bet Tzedek Small Business Team. Before COVID, common issues involved business formation, employment law, intellectual property and trademark questions.
Leases & Landlords
“The number one question today is about commercial leases,” says Ettinger. “So many say, ‘I’ve been shut down for so long, what happens if I can’t pay their rent?’ ‘How long are protections in place?’”
This is the time, instructs Will Watts, managing attorney with the Legal Aid Foundation to “dust off your leases and make sure you know what you signed years ago.” (It’s the same for insurance policies, he adds.) Often lease agreements with landlords are pretty standard with a common boiler plate. “But leases can vary, some bigger landlords augment a standard lease,” he explains. “Smaller land owners often use agreements that don’t come with a lot of bells and whistles.”
Many times, owners don’t realize they can negotiate their lease, says Watts. “We let them know what their lease says and point out how to open a dialogue with your landlord. Maybe you two have some horse-trading opportunities.”
Leases spell out the terms with rent is due, ways to pay the rent, how rent is calculated and often what common area expenses you will contribute, continues Watts. Leases also describe what constitutes a notice for default and what situations will excuse your rental obligations, better known as the force majeure (act of God) clause.
The legal world is still fuzzy if a pandemic is indeed a force majeure, says Ettinger. “My understanding is that it’s like an old lawyer’s saying: ‘It depends.’ Sometimes it is, sometimes it isn’t.”
Lease questions often go hand-in-and with eviction queries, says Watts. Even with the recent extension of the eviction moratorium for both residential and commercial properties, there is a lot of confusion, he said.
“One big reason is that Los Angeles County has one directive and then LA City has its own ordinances, and these two can be very inconsistent with messaging, especially for those on the commercial side.”
Also confusing for many owners is what kinds of loans are available specifically to them, says Ettinger. “We don’t assist them with getting the loans, but help them understand if they are eligible for what is out there,” she says.
Additionally, employment and PPP questions are also common, especially now as that program starts to wind down.
Above all, Ettinger says pro bono lawyers are called to translate legalese into everyday language. “There is a level of fear that they don’t understand what it all means,” she says. “So many worry that ‘I’m getting it all wrong!’ We try to calm those fears.”
The Bet Tzedek Small Business Team and LA Represents are helping owners find legal help related to coronavirus-related issues. Go here for more information.
Persons who need legal assistance can also apply for free legal help from the Legal Aid Foundation by calling (800) 399-4529 or visiting LAFLA.org.
Poll: How has your landlord responded to the pandemic?
Deadline for Small Biz Disaster Assistance Loans
Small businesses in Los Angeles County that were affected by recent civil unrest have less than a month to apply for a Disaster Assistance Loan from the U.S. Small Business Administration.
Businesses that experienced physical or property damage from incidents that began on May 26, 2020 have until August 17 to file an application for property damage. Businesses of all sizes and private nonprofit organizations may borrow up to $2 million to repair or replace damaged or destroyed real estate, machinery and equipment, inventory and other business assets. These SBA low interest loans can also help with improvements that can protect, prevent or minimize possible future disaster damages.
Applications for SBA's economic injury loans are due March 17, 2021.
R2D2 on aisle four?
The future may be robotic – and most people will be fine with that.
Global consumers say they are comfortable with robots being part of their in-store shopping experiences and at-home delivery services, according to Euromonitor International’s recent 2020 Digital Consumer Survey. The openness for robot interaction could be driven by the pandemic’s emphasis on contact-less engagements that means less one-on-one human time.
The survey conducted from late March to early April revealed that 45% of consumers are comfortable with robots guiding them to products within a store, and 44% say they would welcome a delivery directly from a drone or robot.
There are non-robot friendly areas. Only 27% were OK with companies automatically reordering products on their behalf; and only 33% of consumers were keen on robots preparing an entire meal while dining out.
More close-knit neighborhoods, less cars and more bike lanes.
Wanting to avoid economic disaster, urban leaders from around the world recently put down a series of recommendations on how cities can fight climate change and address racial inequalities – even in this pandemic era.
The Mayors’ Agenda for a Green and Just Recovery emphasizes that cities need to invest in their own resilience through green solutions, safe and reliable mass transit, create and fund more just and inclusive communities. Some solutions are already being implemented in many cities around the world.The Agenda was released by the C40 Global Mayors COVID-19 Recovery Task Force, established at the direction of C40 Chair and L.A. Mayor Eric Garcetti, and chaired by Mayor of Milan Giuseppe Sala.
Need to know info
Got a great idea for a new business? Maybe something related to our current pandemic? The folks from SCORE Los Angeles want to help you find your feet.
Starting a Business: What You Need to Know is a virtual morning workshop held Friday, July 24. The 2-hour long online webinar details all the important steps in setting up a company and covers such topics as legal requirements, licensing and taxes, insurance, financing sources as well as appropriate elements of a business plan and marketing consideration.
There’ll be practical advice on how owners can effectively manage multi-tasking, the pros and cons of certain legal structures and what causes so many businesses to fail. Participants will leave with a 17-point checklist of action items. Cost is $10. Go here to learn more and to sign up.
That’s it for this issue!
Thanks for reading! Hunker down and carry on! We will be back next week with more Biz Buzz.
-- Brenda Rees