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A Closer Look at Massachusetts COVID-19 Relief Programs

By Meg Nash, David Gately

Apr 30, 2020

The Massachusetts government has enacted several programs aimed at helping businesses and workers adversely impacted by the novel coronavirus (COVID-19). In this VS Insight, we take a closer look at the state's employment relief (for employers and employees), tax relief, and loan programs. This post is for informational purposes only and not for the purpose of providing legal or tax advice. We strongly encourage you to contact an attorney if you are seeking advice regarding any specific legal or tax issue.

For more information about Massachusetts's COVID-19 response and how it may impact cannabis business operators, medical patients, and other consumers, see our "Massachusetts Regulatory Updates" post. For national updates and additional resources, see our main post on COVID-19, "Coronavirus and Cannabis: Monitoring the Impact."

CONTENTS:    Employment Relief Programs (for Employers / for Employees)   |  Tax Relief Programs   |  Loan and Grant Programs   |  Legislative & Regulatory Updates

Employment Relief Programs

For businesses adversely impacted by COVID-19, Massachusetts provides support services and other industry-specific resources. More information can be found on the Mass.gov COVID-19 Resources & Guidance for Businesses page.

For workers, the Massachusetts Department of Unemployment Assistance (DUA) and certain localities are providing unemployment insurance and other benefits to persons who have lost their jobs or had their work hours reduced. More information about these programs can be found on the DUA's COVID-19 resources page. We have also compiled summaries below for employers and employees. 

Employer Relief Programs

Work Sharing

For employers who hope to preserve jobs and are looking for an alternative to layoffs, the Massachusetts Department of Unemployment Assistance (DUA) has a WorkShare program in place that allows companies to reduce the hours of its employees, and the employees will be able to receive unemployment benefits to supplement their reduced wages. To be eligible, an employer must meet a number of eligibility requirements, which are available here.

Rapid Response Program

Rapid Response is a federally mandated, pre-layoff service program designed to assist businesses and employees experiencing a layoff or closing. In Massachusetts, the MassHire Rapid Response Team is a business service of the MassHire Department of Career Services with regional teams throughout the Commonwealth. The teams provide layoff aversion and early intervention services to companies and their employees for free. The intended result is a smooth transition for all affected employees, who, before being separated from their company, will be provided with options prior to a layoff and referred to a MassHire Career Center of the employee’s choice. In some cases, employers are required to provide a 60-day notice before a layoff. Certain mass layoffs and plant closings will meet the criteria of the Worker Adjustment and Retraining (WARN) Act. Additional resources are included below:

    • MassHire Career Centers: Provides several services, most free of charge, including help with job-search skills including preparing for interviews, writing resumes, and developing a network of contacts. MassHire Career Centers also provide publications on jobs and careers, workshops, a comprehensive list of openings in state government, and special services for Veterans. 

    • Training Opportunities Program: The Training Opportunities Program (TOP) allows individuals to collect unemployment benefits while attending full-time, approved training for new job skills. Individuals who need to acquire new skills in order to become re-employed may be eligible. To participate in TOP, one must submit a completed application to the DUA. If eligibility requirements are met, TOP allows DUA to waive an individual’s active work search requirement. The individual will continue to receive unemployment benefits while in DUA approved training. TOP will allow an individual to receive up to 26 weeks of additional benefits if training extends beyond the duration of their initial unemployment claim. Notably, however, DUA does not fund training costs.

Employee Relief Programs

Paid Family Medical Leave

Paid Family Medical Leave (PFML) is a state-offered benefit for anyone who works in Massachusetts and is eligible to take up to 26 weeks of paid leave for medical or family reasons. PFML is funded through a Massachusetts tax, and is separate from both the federally mandated benefits offered by the Family Medical Leave Act (FMLA) and from leave benefits that may be offered by an employer.

PFML benefits will become available on January 1, 2021. Paid family leave may be taken to care for a sick family member; bond with a newborn child; bond with a child after adoption or foster care placement; manage family affairs when a family member is on active duty in the armed forces. While paid medical leave may be taken to manage a personal serious injury or illness.

To be eligible for an employer exemption from making PFML contributions, you must offer an approved private plan with paid leave benefits that are equal to or more generous than those provided under the PFML program. Exemptions are only available to and intended for employers, not individuals.  More information about the PFML program is available here.

Unemployment Insurance Benefits Eligibility

In response to the COVID-19 outbreak, the Massachusetts Executive Office of Labor and Workforce Development (EOLWD) and the Department of Unemployment Assistance (DUA), in coordination with the U.S. Department of Labor, have been taking action to assist workers and employers. The following is a high-level summary of eligibility requirements for unemployment insurance benefits during the COVID-19 pandemic:

    • An individual is eligible and should apply for unemployment benefits during COVID-19 if:

      • Their employer has shut down because of COVID-19.

      • Their employer has reduced their hours of work or wages because of COVID-19 (employee may be eligible for partial unemployment benefits).

      • They are temporarily unemployed due to lack of work because of COVID.

        • Workers will be considered unemployed due to lack of work regardless of whether they are quarantined, laid off, furloughed, or if their workplace is fully or partially shut down temporarily.

        • This status is granted automatically for the first four (4) weeks, and then, your employer may request that this status be extended to eight (8)    weeks. If necessary, DUA has authority to allow for longer periods.

      • They are quarantined and told not to return to work after quarantine.

        • If quarantined due to an order by a civil authority or medical professional, or to care for a family member, and not allowed to return to work, the individual is eligible for unemployment benefits and does not need to provide medical documentation and only needs to be available for work when and as able.

      • If an individual’s physical workplace has been shut down and they are working full time from home, they are not eligible for unemployment benefits.

        • If the individual was a full-time employee before their workplace shut down and they are now working part-time hours from home, they may be eligible for partial unemployment benefits.

      • If an individual has left work due to fear of COVID-19, they may be eligible for benefits.

        • These determinations are made on an individual case-by-case basis. An employee who left work because of fear of being exposed to COVID will need to demonstrate, among other things, that such fear was reasonable in the circumstances.

Learn more about eligibility for unemployment benefits.

Unemployment Assistance Program Modifications

The following COVID-19-related changes have been made in Massachusetts in connection with the administration of unemployment claims:

    • Requirements related to the attendance of seminars at the MassHire career centers have been suspended.
    • Missed deadlines by employers and claimants because of COVID-19 may be excused under DUA’s good cause provision.
    • Employers whose businesses are severely impacted by COVID-19 can request extensions for filing and paying unemployment contributions.
    • “Worksearch” requirements will be interpreted to appropriately permit claimants affected by COVID-19 to collect benefits.
    • Appeal hearings will be held by telephone only.

As described below, on March 18, 2020, Governor Baker signed SB 2599 into law, which allows new claims to be paid more quickly by waiving the one-week waiting period for unemployment benefits. This means that DUA is authorized to pay benefits without delay to persons who become unemployed because of lay-offs or business shutdowns taken in response to the virus, because of quarantine orders or directives or illness that prevents them from leaving their homes, or because they must care for a sick or quarantined family member.

Additional COVID-19-related information for employers and employees is available here.

 

Tax Relief Programs

Tax Credits for Businesses

Clean Energy Tax Incentives

In Massachusetts, there is an energy tax incentive benefit available to businesses under M.G.L. c. 63, § 38H. This statute exempts one hundred percent (100%) of any “solar or wind-powered climatic control unit and any solar or wind-powered water heating unit” or any other unit or system powered by solar or wind including the cost of labor associated with installation from corporate excise tax for the length of the system’s depreciation period. Massachusetts businesses that install qualifying solar or wind units can exempt the value of the unit from the overall property valuation used to assess the corporate excise tax.

Extensions for Businesses

Municipal Tax Extensions

In addition to the foregoing, pursuant to the Act, and “An Act to further address challenges faced by municipalities, school districts and state authorities resulting from COVID-19” (H. 4974), municipalities have the authority waive late fees for fourth-quarter tax bills, which are due May 1, and to push back their tax bill deadline from April 1 to June 1. The City of Boston has already adopted local options to extend due dates for real and personal property tax payments through June 1, 2020. Additional information is available here. With respect to additional municipalities throughout Massachusetts, please contact your Vicente Sederberg attorney for fact-specific analysis.

Massachusetts Extension of Deadlines for Sales and Use Tax Not Available for Adult Use Marijuana Retailers

Massachusetts’s Department of Revenue has extended the deadline to file Sales, Use and Meal taxes. Due dates for the filing of returns and making payments for sales, use, and meals taxes for February, March and April returns have been extended to June 20, 2020, for vendors with cumulative liability for sales and use tax under $150,000 in the 12–month period ending February 29, 2020 (i.e., for tax collected through January 31, 2020). However, the Department of Revenue’s Technical Information Release 20-2, providing more detailed information on this extension, clarifies that the relief described is not available to adult-use marijuana retailers. However, retailers selling state-legal hemp products are not excluded from the list of qualified vendors. Additional information from the Department of Revenue is available here.

Corporate Excise Tax Return Penalty Waiver

The Massachusetts Department of Revenue will waive certain late-file and late-pay penalties that apply to corporate excise returns and payments due April 15, 2020. The waiver of penalties applies to corporate excise returns and payments with an original due date of April 15, 2020, including those of certain S-corporations and non-profits that file on a fiscal-year basis and have tax returns and payments due April 15, 2020. However, please note that payment for corporate entities is still due by April 15, 2020, and by law, interest will accrue on any amounts not paid by April 15, 2020. Corporate excise taxpayers will only be eligible for an automatic extension of time to file their tax returns as long they have paid the greater of (1) 50% of the total amount of tax ultimately due, or (2) the minimum corporate excise by the original due date for filing the return.

Extensions for All Taxpayers

Extensions to File Personal Income Tax Returns

Pursuant to “An Act to Address Challenges Faced by Municipalities and State Authorities Resulting from COVID-19” (the “Act”) (H.4598), enacted April 3, 2020, the state is providing tax extensions for personal income tax returns. Personal returns and payments otherwise due April 15, 2020, are now due July 15, 2020.

 

Loan and Grant Programs

Cannabis and Hemp Business Relief

Massachusetts has not formally implemented any programs specifically designed to assist the cannabis or hemp industry. However, companies may be able to access loans through private lenders seeking to assist small businesses during the COVID-19 crisis. Please contact your Vicente Sederberg attorney for further assistance.

State Programs

Various relief funds have emerged in Massachusetts in the wake of the COVID-19 Pandemic. Select programs are described in further detail below:

  • Massachusetts Growth Capital Corporation Microloan Program: This microloan program is operated through the Massachusetts Growth Capital Corporation, one of only two statewide intermediary lenders for the Small Business Administration’s Microloan program. The Microloan Program provides financing to existing Massachusetts small businesses to assist with working capital, or the purchase of furniture, fixtures, supplies, materials, and/or equipment. Financing is available in amounts ranging from $5,000 to $50,000, with amortization up to six years. In order to be eligible for a microloan, the applicant must satisfy the following criteria:

    • Massachusetts based business, 

    • Minimum personal credit score of 575, 

    • No historical or pending charge offs by creditors permitted or existing government liens,

      Must provide two (2) years of tax returns; business and personal

    • Lien on all business assets,

    • Personal guaranty (may require security)

Because the Microloan Program is offered through the SBA, cannabis businesses and ancillary businesses are likely ineligible to receive funding. Hemp companies may qualify for loans. Find additional information regarding cannabis and hemp companies’ eligibility for SBA loans.

  • MassDevelopment Equipment Financing: MassDevelopment’s equipment loan program aids companies in expanding operations who need to purchase new or used equipment. Up to $2,000,000 in financing is available for eligible applicants, with loan terms up to seven years. Interested borrowers can complete an application here.

  • Climate Smart Agriculture Program: The Climate Smart Agriculture Program combines the Agricultural Climate Resiliency & Efficiencies (ACRE) Grant, the Traditional Ag-Energy Program Grant (ENER), and the Agricultural Environmental Enhancement Program Grant (AEEP) to bring three grant programs overseen by the Massachusetts Department of Agricultural Resources (MDAR) under one program. Projects that help the agricultural sector reduce vulnerability to expected climate change effects (adaptation), mitigate climate change by reducing emissions, avoiding and displacing emissions, and/or removing emissions, and improving economic resiliency are eligible for funding and broken into two categories, Part I: Climate Adaptation & Mitigation and Part II: Energy Efficiency & Renewable Projects. Applicants must meet the following eligibility requirements to qualify for this program:

    • Agricultural operations engaged in the production of agriculture for commercial purposes as defined in Massachusetts law M.G.L c. 128, Sec. 1A.

    • Applicant must own, or be a co-applicant with the owner of the agricultural operation, who has a legal interest in the land whether by deed or written agreement and approval to implement the project on the land, which must be in active agricultural use and managed as a commercial enterprise by the Applicant for at least the three previous years.

    • Produce operations applying for post-harvest infrastructure upgrades must have an average annual value of produce sold during the previous three-year period of $25,000 or more. Sales must be for produce covered under the Produce Safety Rule (PSR).

Local and Regional Programs

Numerous local programs have risen to address a variety of small business needs, some of which are more narrowly tailored to specific groups of recipients. For example, the Restaurant Strong Fund, aimed at supporting individuals in the restaurant industry, the Massachusetts COVID-19 Relief Fund, dedicated to supporting essential frontline workers and vulnerable populations across the state. The City of Boston has compiled a comprehensive Financial Relief Handbook for Small Business Owners that is regularly updated. The following local programs provide broader relief to larger groups of small businesses across the state:

  • City of Boston Small Business Relief Fund: The City of Boston's Small Business Relief Fund’ will provide emergency funds to City businesses and business owners who have been critically impacted by the COVID-19 pandemic. The City will prioritize funding businesses in industries most directly affected by closures, policies, or general loss of revenue related to the COVID-19 pandemic. As of April 10, 2020, the City of Boston stopped accepting new applications. The application portal will reopen if additional funding becomes available.

  • Eastern Bank Impact Loan Funds: Eastern Bank, a regional commercial bank with locations in Massachusetts and New Hampshire, will, through its Small Business Impact Loan Fund, allocate $5M for lending to small businesses who are existing customers in need of working capital. Eligible small business may receive up to $25,000.

  • COVID-19 Small Business Stabilization Network: In addition to the foregoing programs, a consortium of organizations referred to as the COVID-19 Small Business Stabilization Network is providing targeted local assistance to communities throughout Massachusetts.

 

Legislative & Regulatory Updates

A list of Massachusetts and Federal laws, regulations, resources on COVID-19 is available here, and a comprehensive digest of Massachusetts bills related to the COVID-19 pandemic is available here. Of interest are the following:

  • SB 2599: An Act authorizing waiver of the one week waiting period for unemployment benefits 

    • This bill instructed the DUA to waive the one-week waiting period for unemployment benefits claims by individuals separated from work due or related to the 2019 novel coronavirus or “COVID-19” outbreak, or the effects of the Governor’s March 10, 2020 declaration of a state of emergency. 

  • 430 CMR 22.00 COVID 19 Emergency Regulations  

    • These emergency DUA regulations establish procedures and interpret the provisions of the Commonwealth’s Unemployment Insurance statute (M.G.L. c. 151A) to alleviate the hardship that COVID-19 may cause to workers and employers, by among other things, creating a “Standby Status” for claimants with an expected return-to-work date who are temporarily unemployed for lack of work due to COVID-19, and also by deeming COVID-19-related reasons as “good cause” for missing deadlines. 

  • HB4647: An Act providing for a moratorium on evictions and foreclosures during the COVID-19 Emergency 

    • This bill creates several protections for renters and homeowners, which terminate on the earlier of either 120 days after passage, or 45 days after the lifting of the COVID-19 emergency declaration; including but not limited to, the following: 

      • Prohibits landlords or property owners from terminating a tenancy or sending notice, including a notice to quit or vacate a property in cases of non-essential eviction (which is defined as an eviction that does not involve criminal activity that can impact health or safety, or allegations of lease violations that may impact the health or safety of other residents); 

      • Prohibits creditors, mortgagees or individuals having an interest in mortgaged land from publishing a notice of foreclosure sale, exercising a foreclosure sale, exercising a right of entry, initiating a foreclosure process. 

  • 940 CMR 35.00: Unfair and Deceptive Debt Collection Practices During the State of Emergency Caused by COVID-19

    • The purpose of these emergency regulations is to protect consumers from unfair and deceptive debt collection practices during the outbreak of COVID-19.

    • These new regulations will remain in effect for 90 days or until the state of emergency declared by Governor Baker in Massachusetts is over.

  • Amendment to 940 CMR 3:18: Emergency Regulation Prohibiting Price Gouging

    • Prohibits price gouging of goods and services necessary for public health and safety during a declared statewide or national emergency.

    • This emergency amendment was filed in response to widespread reports of inflated prices for goods like hand sanitizer, face masks, and gloves as well as temporary personnel in response to the growing demand for such products and services due to the spread of COVID-19

The content and links provided on this page are for informational purposes only and not for the purpose of providing legal or tax advice. Viewing this page does not establish an attorney-client relationship. You should consult with a qualified legal professional for advice regarding any particular issue or problem. The contents of this page may be considered attorney advertising under certain rules of professional conduct.

Banking & Financial, Boston, COVID-19, David Gately, Government & Policy, Massachusetts, Meg Nash