Good morning, MBA readers,
Amid more news of mounting job losses, here’s a bit of relief: Starting today, small business owners can apply for up to $25,000 in federal loans to help offset damage caused by COVID-19, which has infected more than 213,000 people in the U.S. and slammed the breaks on the economy. This bridge loan program serves as the first wave of Main Street economic aid before the government sends checks of up to $1,200 to Americans later this month.
For city and county governments, relief will take some time to arrive as most jurisdictions in Missouri — except Jackson County — are not large enough to qualify for direct funding from the Treasury Department. The matter has raised consternation among elected officials in Kansas City, which came up just short of the population requirement of 500,000.
Those relief efforts come against the backdrop of consecutive days of massive unemployment numbers. Following Thursday’s news of record weekly unemployment claims at the state and national level, Friday’s monthly jobs report showed U.S. payrolls shedding 701,000 jobs in March — the most in a single month since 2009.
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Speaking Startup: Gauging entrepreneurs’ concerns in a pandemic
In the midst of a pandemic, as ever, cash is king. That’s one of the key early findings from a KCSourceLink survey assessing how Kansas City entrepreneurs are responding to the COVID-19 outbreak and the accompanying economic slowdown. Jenny Miller of KCSourceLink joined this week’s Speaking Startup podcast to discuss that and other insights from the survey, and to talk about how her organization is advising entrepreneurs in the midst of a crisis.
Feds launch emergency business loans despite lender concerns
The Small Business Administration on Friday opened up applications for the $349 billion coronavirus rescue loan program, which the White House says would issue funding to small businesses within days. The U.S. Treasury department and the SBA have issued new guidance for the program that limits layoffs. (Reuters)
Cities await relief funds to trickle down from state
Neither Kansas City nor St. Louis meets the population requirement of 500,000 needed to get direct aid through the U.S. Treasury, meaning the cities will have to wait for funds to trickle down through the state bureaucracy. Kansas City Mayor Quinton Lucas has protested the benchmark. (Kansas City Star, St. Louis Post-Dispatch)
Centene to waive coronavirus costs for beneficiaries
The Clayton-based managed care provider announced Thursday it will cover the cost of COVID-19 treatments for its Medicare and Medicaid beneficiaries. Centene is also allowing care providers to forgo collecting co-pays and authorization for treatment related to the coronavirus in an attempt to expedite the already hamstrung system. (St. Louis Post-Dispatch)
Lawmaker, advocates call for freeze on rent, mortgage
Missouri House Minority Leader Crystal Quade, D-Springfield, has joined advocates in Kansas City and St. Louis in calling for a statewide suspension of rent and mortgage payments, evictions, foreclosures and utility shutoffs to mitigate economic pressures stemming from the coronavirus outbreak. (Springfield Business Journal, St. Louis Public Radio)
AMC takes credit hit amid restructuring talks
Debt rating agency S&P Global Ratings on Thursday downgraded AMC Entertainment’s credit rating to CCC-, citing liquidity concerns. That follows reports that lenders for the Leawood, Kansas-based cinema chain have hired legal counsel during expected restructuring talks. AMC shuttered all of its theaters and either furloughed or laid off 26,000 workers last week. (Hollywood Reporter, Wall Street Journal)
Boeing introduces voluntary buyouts
The head of Boeing’s commercial aircraft division told employees Thursday the company will likely reduce its workforce via voluntary buyouts to adjust to “the realities of a different-sized commercial market once the recovery starts.” Boeing is expected to shed at least a “several thousand” workers in the process, according to a person close to the discussions. (Seattle Times)
Emerson expands into hydroelectric with new deal
The Ferguson-based industrial conglomerate announced Thursday that it acquired American Governor Co., a Philadelphia company that provides technology and services for hydroelectric turbine controls. (St. Louis Business Journal)
American Century launches new ETFs
The Kansas City-based investment firm has launched a new kind of exchange-traded fund that it describes as a cross between an ETF and a mutual fund. The funds can be managed without daily holdings disclosures and allow people to trade them at any time. (Kansas City Business Journal)
COVID-19 further drives down Bass Pro’s credit outlook
Moody’s Investors Service has issued a negative future credit outlook on Springfield-based Bass Pro Shops, projecting weakened credit metrics due to declines in consumer spending. (Springfield Business Journal)
Rawlings lays off 130
Town and Country-based Rawlings Sporting Goods has laid off 130 workers at a factory in Washington, Missouri, citing a dramatic downturn due to freeze of baseball-related activities. (St. Louis Business Journal)
Owner of KC radio stations plans to trim jobs, salaries
Philadelphia-based Entercom Communications, which owns eight radio stations in the Kansas City market, said it plans to begin laying off and furloughing some of its 5,000 employees. The company also plans to slash salaries by up to 20%, cancel bonuses and temporarily suspend dividends and its 401(k) company match. (Kansas City Business Journal)
Missouri bedding maker pivots to gowns, masks for hospitals
Lebanon-based Justice Furniture, which typically produces mattresses and couches, is now manufacturing masks and hospital gowns for Springfield’s CoxHealth and some local nursing homes. (Missourinet)
Pandemic pushes back Missouri college graduations
The University of Missouri System announced Thursday it will not host in-person graduation ceremonies for students graduating May, marking the first time it has delayed commencement since the Civil War. MU will host a virtual ceremony and invite graduates back to campus for a proper commencement in the near future. (Kansas City Star)
St. Louis telehealth startup raises $6 million
SteadyMD has raised $6 million in a recent Series A funding round led by Utah-based Pelion Venture Partners. The startup plans to use the funds to further develop its technology that evaluates patients and connects them to doctors best suited to their needs. (St. Louis Business Journal)
Columbia Lucky’s to close, reopen as Schnucks
Lucky’s Market in Columbia will close next Tuesday following the chain’s bankruptcy filing in January. The store will reopen at a later date as Schnucks, which acquired the location, and offer jobs to all 89 of the existing local workers. (Columbia Missourian)
With the coronavirus spreading and two major oil-producing countries engaging in a price war, the price of a gallon of gasoline hit its lowest point in years this week. Before speculation that Russia and Saudi Arabia would agree to cut production sent crude oil prices soaring Thursday, the average price for a gallon of gas in the U.S. had dipped below $2 for the first time in four years. Prices in the Midwest were even lower.
Say that again
“Three weeks ago, I was frozen in fear. I thought, ‘Oh man, this is gonna be a bad spring.’ And I just haven’t seen it. I’ve just seen people being cautious but still proceeding.”
That’s Columbia real estate Brent Gardner, who says he has seen a healthy flow of new homebuyers in recent weeks despite the worsening coronavirus pandemic, the Columbia Missourian reports. It’s been a pleasant surprise, said Gardner, who expected business to shut down for at least a month. In fact, the state logged nearly 10,000 pending existing home sales, according to the National Association of Realtors. One factor may be that cities like Columbia consider real estate transactions essential business under stay-at-home orders. Missouri Realtors CEO John Sebree doesn’t believe Missouri homebuyers are in the same place they were in during the 2008 financial crisis, when sales cratered amid widespread mortgage defaults and foreclosures. He added that the state also enjoys a more stable housing market than others, but it is potentially vulnerable to the mounting job losses due to the ongoing pandemic.
That’s how much Kansas City plans to spend isolating homeless COVID-19 patients in a hotel, The Kansas City Star reports. The City Council on Thursday unanimously approved a contract with Satyam Corp. to provide hotel space at the Rodeway Inn. The bill, introduced by Lucas, would make up to 30 rooms available to homeless residents with symptoms of the coronavirus. The plan mirrors similar moves made by officials in Los Angeles, Austin and Charlotte, North Carolina as cities scramble to make quarantine space available for vulnerable individuals who come into contact with the disease.
About 50 non-essential businesses are about to receive a letter from County Counselor Beth Orwick demanding they follow the law. Those businesses are putting their customers and employees at risk. They’re undermining our efforts to #FlattenTheCurve. It’s time for them to stop.
— County Executive Sam Page (@DrSamPage) April 2, 2020
St. Louis County Executive Sam Page tweeted this forceful reminder Thursday as the county issued warning letters to businesses that had defied orders to close. About 50 local businesses, including restaurants and nail salons, were formally ordered to shut down after failing to follow a county-wide directive intended to curb the spread of the coronavirus, the St. Louis Post-Dispatch reports. Further violation could yield up to a year in jail and up to $2,000 in fines.
Hello, my name is
The Honeywell veteran has been named the new president of the manufacturing conglomerate’s Kansas City division, the Kansas City Business Journal reports. Wollerman, who spent a decade running Honeywell’s aerospace portfolio, will take over the Honeywell Federal Manufacturing & Technologies next week. He succeeds John Ricciardelli, who has led the Kansas City division for four years. Honeywell FM&T handles non-nuclear components for the nation’s nuclear weapons stockpile and employees about 4,700 people, making it the second-largest manufacturer in the Kansas City region.
Word to the wise
This refers to alcohol that is made for industrial or domestic use, but that contains an added “denaturant” that makes it undrinkable, according to the Food and Drug Administration. That distinction came to the fore Thursday, when U.S. Sen. Roy Blunt, a Missouri Republican, called on the FDA to further loosen rules and permit alcohol distillers to make hand sanitizers amid a nationwide shortage, The Kansas City Star reports. In light of the coronavirus pandemic, the FDA has already relaxed some rules for alcohol producers, but its rule requiring sanitizer makers to denature their alcohol remains. In a letter to the FDA, Blunt and six other U.S. senators asked the agency to allow the use of undenatured alcohol that distillers already have on hand. The proposed policy change would not make much difference for large distillers, said Andy Rieger, president of the J. Rieger & Co. distillery in Kansas City. But, he added, it would allow smaller distillers to use vodka they already have in store to produce more hand sanitizers as demand for the product skyrockets.
It’s been a pleasure doing business with you this morning. Here’s hoping for a healthy and restful weekend.