Many households keep an emergency fund for those “just in case” times. On the days when your car dies, your furnace stops or the air conditioning quits, you’re glad to have a reserve for the unexpected financial burden. Battling a worldwide health pandemic has become the ultimate “just in case” time for many Marylanders and our state’s Rainy Day Fund.
For months, I have urged Governor Hogan to use the fund of more than $1 billion to help Marylanders who are struggling, and our employers keep our families receiving paychecks. Using the Rainy Day Fund could help prevent evictions and foreclosures and provide cash assistance for basic necessities until a second federal government stimulus package passes. Tapping into these resources along with half-billion revenue fund balance and the remaining CARES Act federal dollars would ensure these families and small businesses survive the long, cold winter.
While our recent December Board of Revenue Estimates report projects Maryland’s economy being healthier than expected, it highlights how our lowest wage earners and small businesses continue to bear the brunt of the pandemic’s impact. The overall report reflects the strong bones of our state’s economy and our ability to weather tough times. However, it doesn’t tell the tale of many individuals, families and businesses trying to weather the toughest financial times of their lives.
Our small businesses, unemployed citizens, and working families, especially in our minority communities, need financial assistance now. Our Latino and African-American communities and women, who disproportionally work in industries suffering the most, are bearing the brunt of this pandemic not only with their health, but also with their lack of wealth. Disproportionately more minorities are dying from COVID and losing their jobs.
Our data shows that just during the second quarter of 2020, when compared to the same time period in 2019, big businesses – measured by sales tax that represent our top 0.1 percent or just 61 businesses – are reporting an increase of 32 percent in sales.
Our smaller businesses – or 99.1 percent of our state’s businesses – are seeing drops in receipts of about 11 percent on average. In fact, also during this same time period, the State of Maryland lost 11,634 sales tax accounts.
While big box stores and Amazon thrive, we’re seeing “closed” signs as we drive down the Main Streets of our towns and communities. It’s grossly unfair for small business owners, who are unable to wield the resources of bigger corporations.
Maryland has more than 170,000 small businesses and we estimate about 30,000 have either closed or will close their doors forever — through no fault of their own due to the pandemic’s toll. It’s expected that 10,000 restaurants nationwide will close permanently by year’s end.
With the General Assembly opening January 13, I will continue to push state legislators and the governor for more help for Marylanders. We can continue to keep talking about it, or, we can start putting our rhetoric into action. It’s time to use the Rainy Day Fund. For Marylanders, it’s not only raining, it’s pouring. Maryland’s families and business need cover.