Kansas creates emergency loan program for hospitality industry during pandemic

photo by: Associated Press

Kansas Gov. Laura Kelly, left, talks to Chuck Magerl, right, the owner of the Free State Brewing Company in Lawrence after a news conference to announce the launch of a new state loan program, Friday, March 20, 2020, at the Statehouse in Topeka, Kan. The new program will make $5 million in short-term, no-interest loans to bars, taverns, restaurants and motels struggling to cover their operating expenses. (AP Photo/John Hanna)

Story updated at 11:27 a.m. Friday

Kansas restaurants and hospitality businesses suffering during the COVID-19 pandemic will have another resource available to supplement their income, Gov. Laura Kelly announced Friday.

The Kelly administration created the Hospitality Industry Relief Emergency Fund, a $5 million pool which allows hospitality businesses to apply for bridge loans up to $20,000. The program — funded through the state jobs fund — allows businesses to repay the loans with no interest for the first three years. There are also no payments required for the first four months of the loan.

“There’s no question that these major disruptions to our daily lives pose a serious economic threat to Kansas businesses and workers,” Kelly said in a press conference. “COVID-19 is a new virus strain. It has created unprecedented disruptions in our daily lives, and confronting it demands that we think innovatively.”

Businesses that qualify for the program include restaurants, bars, lodging facilities, conference centers and event centers with fewer than 100 employees and that have no outstanding state tax obligations. Other hospitality businesses can apply and be considered on a case-by-case basis, according to the Kansas Department of Commerce website.

The program is designed to provide prompt assistance to businesses that have been forced to close or dramatically reduce their operations in the interest of public safety. Decisions on how much money will be allocated to applicants will be made within 72 hours of submission, and the funds will be distributed to the business within 48 hours of the application’s approval, Commerce Secretary David Toland said Friday. Toland said the program will supplement federal Small Business Administration loans that Kansas expects to become available within days.

photo by: Associated Press

Kansas Commerce Secretary David Toland discusses the details of a new loan program as Labor Secretary Delia Garcia, right, watches during a news conference, Friday, March 20, 2020, at the Statehouse in Topeka, Kan. The new program will make $5 million in no-interest, short-term loans to bars, restaurants, taverns and motels struggling to meet their operating expenses because of steps taken by state and local officials to control the spread of the new coronavirus. (AP Photo/John Hanna)

The program’s implementation comes at a time when Kansas is already seeing skyrocketing job loss as a result of the coronavirus’ rapid spread. Kansas Department of Labor Secretary Delía García said Friday that the state has seen unemployment claims jump 776% over the last week — from 1,296 to 11,355.

Of the $5 million starting out in the fund, $2 million will be available to hospitality businesses in what the Commerce Department is calling the “Kansas City metro area” — Johnson, Wyandotte, Shawnee and Douglas counties. $1 million will be available for Sedgwick County, and $2 million will be available for the rest of Kansas.

The Lawrence-Douglas County health department on Wednesday ordered all restaurants, dining facilities, bars, taverns and nightclubs closed to the public, with the exception of drive-thru, carryout and delivery services. Many Lawrence restaurants had already shut down their dine-in services before Wednesday’s order. Health officers in Johnson and Wyandotte counties enacted similar measures earlier in the week, and counties across the state have followed suit.

Lawrence’s Chuck Magerl, who owns Free State Brewery and also serves as a restaurant industry representative on Kelly’s Council on Travel and Tourism, spoke at Friday’s press conference and extended his appreciation for efforts to keep the hospitality industry afloat during unprecedented times.

“This stunning downturn has taken an immense toll,” Magerl said. “These certainly are steps to keep the important hospitality industry on a pathway to possibilities.”

One of the toughest things the hospitality industry is currently facing other than a sudden decrease in income, Magerl said, is the isolation that comes with the social distancing measures required to slow the spread of the pandemic.

“As hospitality workers, we devote ourselves to caring for the people in our communities. We desperately want to return to our roles in the downtown squares, highway crossroads and neighborhoods across Kansas,” Magerl said. “The memories will motivate us in the difficult days ahead to make sure we believe that there are good times still to come.”

The application process for the hospitality industry is currently open at the Kansas Department of Commerce’s website, kansascommerce.gov.

More coverage: Coronavirus (COVID-19)

As the pandemic continues, the Journal-World will be making coverage of COVID-19 available outside of the paywall on LJWorld.com.

Find all coverage of city, county and state responses to the virus at: ljworld.com/coronavirus/

What to do if you think you may have COVID-19

Patients who have symptoms — difficulty breathing, cough and fever — should stay home, immediately isolate themselves from others and call their health care providers. Patients should never show up unannounced at a medical office or hospital. Instead, they should call ahead to explain their symptoms and give health care workers the ability to minimize the risk to others.

If patients do not have health care providers, they may call the Lawrence Douglas-County health department’s coronavirus line, 785-856-4343.

For updated information on the outbreak, Kansas residents can email COVID-19@ks.gov or call 866-534-3463 (866-KDHEINF), which is staffed 8 a.m. to 7 p.m., Monday through Friday; 10 a.m. to 2 p.m. Saturday; and 1 p.m. to 5 p.m. Sunday.

More information can be found through the Centers for Disease Control and Prevention’s website, the Kansas Department of Health and Environment’s website or the Lawrence-Douglas County Public Health website.


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