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Thanks to The City of Solvang and the Good-Hearted Landlords but shame to greedy landlords


Op-Ed: By Solvang Retailers Association Board

Dear Mayor, City Council Members, City Manager, City Attorney, and all City Staff:
We are incredibly grateful for your extraordinary assistance and contribution to/for the Solvang Business Community. And we sincerely thank you for your hard work and for doing such a great job. It certainly deserves much credit and applause from our small business community. Your much-needed life support of Solvang’s small business community in a time of great need.

All of the small business owner applicants have been issued and received their emergency $5K loan checks (a total of 50 applicants) from Solvang’s Emergency Funds, which was “a life kiss” act during this life-death crisis!

Alternatively, the self-employed and small business owners and their employees who claimed their EDD unemployment by March 20th were told that they still wait to receive their first checks. For some reason, EDD continually requests applicants to answer previously-answered questions, oftentimes by postal mail. Questions like: “why can’t you work?”, as though they are unaware of what is happening all around us. That does not help us at all.

Regarding the City’s Temporary Tenant Moratorium Ordinance: we would like to inform you that some landlords have gone above and beyond, being totally understanding, and a few have even offered free rent or didn’t request rent from their tenants. Still, others are giving a 50% discount on rent in an effort to lend a helping hand during such a critical time. Others have also offered very long extensions on payment options.We are very appreciative and thankful and would like to say God Bless to those good-hearted landlords who are indeed helping and are understanding and supportive of their tenants during such a difficult crisis!

Alternatively, a few greedy landlords and their property managers are unfortunately still acting as though nothing happened; pretending the City’s Emergency Tenant Moratorium Ordinance does not exist it all! They keep bothering, insisting, pushing, forcing, and even threatening to get payment for April’s rent from some of our retail community commercial tenant members. Basically they’re forcing immediate payment saying “your April rent is due now! Pay it now or if you can’t pay it then leave”, offering an exit from long-standing leases. They refuse to accept our payment plan within existing moratorium terms. However, according to the City’s Emergency Tenant Moratorium Ordinance, deferred rent starts to be paid once an emergency term expires and then must be paid within 6 months. However, that is not acceptable to them and they are insisting we start paying rent now. We hope that The City of Solvang can give a stronger message with an official warning to those greedy landlords about the City’s Emergency Moratorium Ordinance meaning and conditions.

We as the Solvang Retailers Association (SRA) are very disappointed by the Small Business Administration (SBA) and State of California Employment Development Department (EDD) and the U.S. Chamber of Commerce.

Financial aid related to Federal-, State- and County-level agencies seem to have totally collapsed and are still only in the info-giving and info-collection phase, with no response and no real action; a total fiasco!

National- and state-level politicians are making promises, but at this point, most businesses have received nothing while large multi-million dollar corporations are the sole recipients of the small business loan support. Local, small business community members continue to receive only promises while the big companies receive all the cash!

We are very disappointed to learn that the SBA funds have already been depleted, but as far as we know, no one from our community received any of SBA’s Payment Protection Program (PPP) loans. How can they even consider those multi-million dollar corporations with hundreds of employees as “small businesses”, with hundreds of millions of dollars worth of turnover and hundreds of locations yet they have less than 499 employees? Just because they can claim 1 less than 500 workers? A small business should not be more than a max of 30 employees and with a max of $5 Million yearly turnovers! Don’t put small businesses in the same pot as multi-million dollar companies!

It seems the only solutions can be expected from our local resources. We are thrilled to learn that the City of Solvang is already working on a second wave Solvang’s Emergency Loan in greater amounts to act as Solvang’s own PPP loan program. The Solvang Retailers Association is strongly supporting the idea of creating Solvang’s own Payroll & Rent Protection Loan/ Grant Program, which would be a better solution than the SBA’s unavailable programs. 

Solvang’s small businesses are about to collapse, with more than half on the brink of closing indefinitely leaving employed residents to face months of unemployment and career uncertainty! That’s why we can’t afford to make the same mistakes that were made in 2018 during the Highway 101 closure disaster. Solvang is now facing its second economical disaster in the last two years, the first of which occurred during the 2018 Highway 101 closure disaster. During that time only a few favored businesses received funding. Now that we’re in the middle of this second disaster, small businesses continue to receive only empty promises while large corporations reap the benefits. The Federal government should have paid the lenders per application, starting from smallest to the largest, rather than receiving a percentage of the given loan, putting all the smaller loans at the bottom of the pile.

Solvang is a unique town in that no national- or state-level franchised nor corporate businesses exist here, and the town is instead filled with mostly independently-owned mom & pop-style small business. It’s time to change the definition of a “Small Business”, limiting it to companies with a max of 30 employees, with a max of $5 million in yearly turnovers! The actual “small businesses” should not be put in the same pot as multi-million dollar companies and with hundreds or thousands of employees companies.

Many of the smallest businesses did not apply because they lacked working relationships with banks beyond their weekly cash deposits. Some opted out because the criteria for loan forgiveness were unclear and they feared being stuck with the debt or couldn’t meet many of the complicated criteria.

The SBA’s PPP loans only cover eight weeks of payroll plus limited expenses for rent and utilities. Many firms need assistance for more than eight weeks. What happens if after eight weeks a company has to lay off staff? Will the loan still be forgiven? How can the government expect small businesses to keep paying for workers who must remain at home while the business is closed? (PPP loans will create another problem with the State’s EDD  unemployment insurance program). And how can those same businesses still be responsible for their unpaid rent(s), utilities, and insurance? Given the government ordered a shutdown of businesses, then the government should offer pay or possibly a grant for our unpaid rents, utility, insurance but not a loan for closed and non-revenue generating businesses. The government wants to save day but we want our futures to be saved.  

The Treasury Department, SBA should instead loan via lenders, and provide grants to pay closed businesses’ rent and utilities, making sure to give relief directly to the real small businesses based on their tax returns’ gross income or rent contracts.