Colorado’s legislature wrapped up a three-day special session Dec. 2 by passing a package of bills to address the economic crisis caused by the COVID-19 virus pandemic, including legislation to provide grants, fee waivers and temporary sales tax relief to Colorado-based small businesses that depend on visits by customers to their facilities for revenue.
Under SB 20B-001, businesses that bring in less than $2.5 million in revenue each year will be eligible for grants of up to $7,000 if they have lost at least 20% of sales since March 26, the first day of the state’s coronavirus lockdown. The aggregate amount of the direct financial assistance provided to business is $37 million.
Counties in compliance with public health orders will dispense the funds. In counties that are not enforcing public health orders, municipalities that are adhering to them will handle the allocation of the money to small businesses within their boundaries. “We want to make sure this money goes to businesses that are following the rules and taking the financial hit because of that,” Senate majority leader Steve Fenberg said.
Republicans objected to legislative language that could prevent businesses in counties that are not enforcing mask mandates and social distancing requirements from accessing the grant funds. Rep. Dave Williams, a Republican from Colorado Springs, praised restaurant owners who have flouted public health orders and accused Democratic Gov. Jared Polis of authoritarianism in attempting to prevent transmission of the novel coronavirus in public places. “I think we need a little bit more civil disobedience,” Williams said. “I think we’ve come to a point where we are beginning to see the bubbling of soft tyranny.”
Sales tax relief is available to some food and beverage outlets whose monthly revenue is $70,000 or less. HB 20B-1004 allows those establishments to keep up to $2,000 per location, with a maximum of five locations covered by the legislation. No restaurant or bar operator will be able to retain more than $10,000 that would otherwise have gone to the state each month.
While the bill allows all establishments that serve food and liquor to take advantage of the tax break, covering “bars, taverns, sales rooms, brew pubs, distillery pubs, nightclubs, or drinking places,” HB 20B-1004 excludes breweries, distilleries, wineries and all retail stores that make available opportunities to taste liquor. Aside from sit-down restaurants, food trucks are included. Food delivery operations are not. The bill allows covered firms to withhold sales tax payments to the state during November and December 2020 and in January and February 2021.
“This is kind of a triage system that we’re running right now, in that we have to prioritize those small businesses that are in the most need and work up from there,” Rep. Alex Valdez, D-Denver, said. He explained that many restaurants, pubs, wineries and other firms that provide hospitality may be experiencing difficulty with paying for the facility changes needed to accommodate customers outdoors, such as patio enclosures and heaters and that the tax relief, in particular, could help them finance those improvements.
The small business relief bill, SB20B-001, also sets aside $7.5 million in grants for artists and $4 million for grants and loans to minority-owned businesses. It also allocates $1.8 million to the state’s Department of Revenue to offset lost liquor license fees.
Altogether, the General Assembly passed 10 bills during the special session. All were cleared on bipartisan votes. Senate president Leroy Garcia, D-Pueblo, said he expects the legislature to continue efforts to help both small businesses and families in economic distress as a result of the pandemic when the 2021 session opens in January. “We’ll look at every option and every tool at our disposal,” he said.