Northam proposes $150M COVID-19 relief fund for small businesses, delay in higher minimum wage
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Virginia Gov. Ralph Northam is proposing to shuffle his financial plan in an attempt to help small businesses, nursing homes and Virginia workers hit hard by the COVID-19 outbreak.
Northam announced last night that he will seek to establish a COVID-19 relief fund for the first two of those groups and fund it with an estimated $150 million in revenue from a new tax on electronic skill games that are popular in a number of restaurants. The General Assembly had voted to ban those games as of July 1 but Northam’s plan would allow them to stay in place through June 30, 2021. Many restaurants had complained that the potential loss of the games would hurt their overall revenues. With restaurants now reduced to takeout or delivery only, elimination of the games would have been another blow for many once they’re allowed to invite customers back inside.
Northam’s proposal would enact a 35% tax on the revenues the games produce, after prize money is deducted from that amount.
Northam also proposed last night to delay implementation of the state’s new higher minimum wage of $9 (up from $7.25) from Jan. 1 until May 1, in light of the virus outbreak. He already had announced a hiring freeze for state government and the suspension of $2 billion in proposed new spending to counteract the impact of the outbreak.
The General Assembly will reconvene April 22 to consider the proposals and other proposed amendments to the state’s $135-billion budget for the next two fiscal years, which the General Assembly approved March 12.
Northam also last night proposed the authorization of a work-sharing program in Virginia that would allow employers to keep employees on staff but reduce their hours. Typically work-sharing programs involve two people splitting a job that one normally would handle. The idea is to allow both employees to stay employed while also remaining eligible to collect a reduced amount of unemployment benefits. Northam’s proposal comes in response to the federal CARES Act stimulus package, which offers incentives for states that implement work-sharing.
