COVID-19 Hospitality Industry Recovery Program Guidelines

• Applicant to complete the electronic application
• Applicant must certify in good faith that need is COVID-related; that they have paid income taxes to the Federal and State Government; remains in operation and does not intend to permanently cease operations within one year of the application date; and that the applicant intends to receive only one grant per county from this program, subject to punishment relating to unsworn falsification to authorities.
• Business is not publicly traded
• Experienced a reduction in revenue in calendar year 2020, measured as follows:
  A. the applicant had gross receipts during the first, second, third or fourth quarter in calendar year 2020 that demonstrate at least a 25% reduction from the applicant's gross receipts during the same quarter in calendar year 2019
  B. if the applicant was not in business during the first or second quarter of calendar year 2019, but was in business during the third and fourth quarters of calendar year 2019, the applicant had gross receipts during the first, second, third or fourth quarter of calendar year 2020 that demonstrate at least a 25% reduction from the applicant's gross receipts during the third or fourth quarter of calendar year 2019;
  C. if the applicant was not in business during the first, second or third quarter of calendar year 2019, but was in business during the fourth quarter of calendar year 2019, the applicant had gross receipts during the first, second, third or fourth quarter of calendar year 2020 that demonstrate at least a 25% reduction from the fourth quarter of calendar year 2019;
  D. if the applicant was not in business during calendar year 2019, but was in operation on February 15, 2020, the applicant had gross receipts during the second, third or fourth quarter of calendar year 2020 that demonstrate at least a 25% reduction from the gross receipts of the entity during the first quarter of calendar year 2020; or
  E. an applicant that was in operation in all four quarters of calendar year 2019 is deemed to have experienced the revenue reduction if the applicant experienced a reduction in annual receipts of at least 25% in 2020 compared to 2019 and the applicant provides copies of its annual Federal tax forms substantiating the revenue decline.
  F. If an applicant changed ownership or control in calendar year 2020, the applicant may measure its reduction in revenue in calendar year 2020 the previously listed criteria, or using the gross receipts of the entity for 2019.
• Must be in business by February 15, 2020 and still in business at the time of the application
• Business operates as a place of business within Pennsylvania having a NAICS designation within the Accommodation subsector (721) or Food Services and Drinking Places subsector (722) and where accommodations, food or drink is served to or provided for the public, with or without charge. If you are unsure of your subsector, more information may be found at: https://www.naics.com/search/
• Has fewer than 300 full-time employees. For purposes of determining the number of full-time equivalent employees under this paragraph, the calculation shall include each employee of the eligible applicant notwithstanding whether the eligible applicant has employees at multiple locations.
• Has a maximum tangible net worth of not more than $15,000,000 computed in accordance with generally accepted accounting principles. If generally accepted accounting principles include the value of other entities, then those entities should be included in the valuation for this requirement.
• Business must be based in either Centre, Clinton, Columbia, Juniata, Lycoming, Mifflin, Montour, Northumberland, Snyder or Union County, PA
• Must submit a W-9 with the application
• Upon approval, applicant must contract electronically with SEDA-COG.

Within each application window; priority will be given to eligible applicants that meet the following criteria:

• to businesses that did not previously receive a loan or grant issued for COVID-19 relief from the Commonwealth of Pennsylvania or the Commonwealth’s political subdivisions or by the Federal Government.
• that were subject to the closure by the proclamation of the disaster emergency issued by the governor on March 6, 2020 and any renewal of the state disaster emergency, or
• Can demonstrate a reduction in revenue which meets one of the following:
  A. that had a greater than 50% reduction in gross receipts or more for the period beginning after March 31, 2020, and ending before December 31, 2020, in comparison to the period beginning after March 31, 2019, and ending before December 31, 2019.
  B. if the eligible applicant was not in operation during the entire comparison period, but was in operation on February 15, 2020, a monthly average reduction in gross receipts of 50% or more for the period beginning after March 31, 2020, and ending before December 31, 2020, in comparison to the period beginning after January 1, 2020, and ending before April 1, 2020.

• The grant amount will be based upon eligible operating expenses. The operating expense must have been incurred between March 1, 2020 and the date of the application or June 15, 2021 whichever occurs first.
• An operating expense, including a payroll and nonpayroll expense, that is both ordinary and necessary. An ordinary expense is one that is common and accepted in an eligible applicant's industry. A necessary expense is one that is helpful and appropriate for an eligible applicant's trade or business. For purposes of determining an eligible operating expense, the following limitations shall apply:
  A. The operating expense must have been incurred between March 1, 2020 and the date of the application or June 15, 2021 whichever occurs first.
  B. For a mortgage obligation, the mortgage must have been in force before February 15, 2020.
  C. For rent, under lease agreements, the lease agreement must have been in force before February 15, 2020.
  D. For utility costs, service must have begun before February 15, 2020.
  E. If an existing mortgage obligation or lease agreement in force before February 15, 2020, is refinanced or restructured after February 15, 2020, the mortgage obligation or lease agreement is deemed to have been in force before February 15, 2020.
  F. Other ordinary and necessary operating expenses (i.e. insurance, food/beverage/supplies spoilage, licenses, PPE, vehicle expenses, social distancing equipment) are to be supported with documented evidence.
• If a business received a federal or state COVID-19 related grant or loan, this would not disqualify any business from this Hospitality Industry grant. However, a grant may not be awarded to pay for the same eligible operating expenses for which an eligible applicant receives or received payment, reimbursement, or loan forgiveness from CARES Act or Consolidated Appropriations Act, 2021 money that is not required to be repaid to the federal government or the act of May 29, 2020 known as the COVID-19 Emergency Supplement to the General Appropriation Act of 2019.
• The “Grant Basis Amount” will be determined by taking the sum of the operating expenses then subtracting the amount of any federal, state or county/local COVID-19-related grant or loan amount that paid for any of these expenses as described in the previous bullet.
• The “Recommended Grant Amount” will be determined by taking the “Grant Basis Amount” and grouping as follows:
  Grant Basis Amount: $5,000-$40,000 = Grant Amount: $5,000
  Grant Basis Amount: $40,001-$80,000 = Grant Amount: $10,000
  Grant Basis Amount: $80,001-$120,000 = Grant Amount: $15,000
  Grant Basis Amount: $120,001-$160,000 = Grant Amount: $20,000
  Grant Basis Amount: $160,001-$400,000 = Grant Amount: $25,000
  Grant Basis Amount: $400,001-$800,000 = Grant Amount: $30,000
  Grant Basis Amount: $800,001-$1,200,000 = Grant Amount: $35,000
  Grant Basis Amount: $1,200,001-$2,000,000 = Grant Amount: $40,000
  Grant Basis Amount: $2,000,001-$4,000,000 = Grant Amount: $45,000
  Grant Basis Amount: >$4,000,000 = Grant Amount: $50,000

The following are examples of how grant amounts will be determined (assume the applicant meets the qualifications). Use the equation in the boldfaced paragraph and refer to the chart above.

• Grant Funding Example 1: Business A has $25,000 in payroll expenses, $3,000 in rent expenses, $5,000 in utility expenses and $2,000 in other expenses totaling $35,000 in total expenses. Find $35,000 is the Grant Basis Amount in the chart. The associated Grant Amount is $5,000.
• Grant Funding Example 2: Business B has $125,000 in payroll expenses, $20,000 in rent expenses, $15,000 in utility expenses and $5,000 in other expenses totaling $165,000 in total expenses. Find $165,000 is the Grant Basis Amount in the chart below. The associated Grant Amount is $20,000.
• Grant Funding Example 3: Business C has $400,000 in payroll expenses, $25,000 in rent expenses, $20,000 in utility expenses and $15,000 in other expenses but received PPP and used $150,000 of that amount to cover the payroll expense. The Grant Basis Amount is: ($400,000+$25,000+$20,000+$15,000-$150,000) or $310,000 in total expenses. Find the Grant Basis Amount of $310,000 on the chart…the associated Grant Amount is $25,000.

• 2019 federal tax return
• 2020 federal tax return (if filed)
• If 2020 federal tax return not filed, submit a 2020 Profit/Loss Statement that clearly lists 2020 Revenues
• Documents/evidence to prove revenue loss as per the qualifications
• Entity documents including DBA or FBN certificate and proof of ownership
• W-9 form
• Government Issued ID
• Evidence of operating expenses incurred between March 1, 2020 and the date of the application or June 15, 2021 whichever occurs first:
  A. mortgage/rent payments—submit evidence of monthly, quarterly or annual costs
  B. utility costs—submit the highest and lowest month payment only for each utility. Utilities include: electric, natural gas, heating oil, HVAC, water, sewer, wifi, cable, garbage removal
  C. payroll costs