Newsom targets small businesses in $4.5B stimulus plan

The $4.5 billion stimulus program Gov. Gavin Newsom proposed for the state Tuesday includes more than half a billion dollars to help battered small businesses.

That $575 million allocation would go to the small business grant program, which has been in place since the fall, according to the Los Angeles Times. Countless retailers, bars, restaurants and other small businesses affected by the pandemic would be eligible for grants up to $25,000. Some money would be set aside for museums and art galleries.

Small businesses statewide continue to get hammered by the pandemic, whose surging case count in recent weeks has further strained the economy. Hoping to slow the rising Covid cases, Newsom implemented tougher restrictions last month, a move that restricted business hours, store capacity and for restaurants, prohibited outdoor dining.

Small businesses in the state were also eligible for similar federal loans available to businesses nationwide. Some shop owners have criticized those grants and loans for being far too small and restrictive in their use.

The governor’s stimulus plan includes measures funded by tax revenue included in the state budget, which will be sent to the legislature on Friday, according to the report. Budget negotiations typically stretch through the spring with an agreement reached by the end of June. Newsom’s office did not specify what measures the governor hopes to have approved in the near term.

The plan also includes a $777.5 million tax credit program that Newsom’s office calls a “California Jobs Initiative.” Those tax credits would be available to businesses that hire new workers or rehire workers who they previously laid off. Some manufacturing equipment would be made exempt from sales tax as well.

[LAT] — Dennis Lynch