COVID-19 relief programs discussed during horsemen’s webinar

Posted: April 3, 2020

Horsemen on April 3 were provided with a comprehensive outline of federal and state programs geared toward financial relief now available because of the coronavirus (COVID-19) pandemic, and they also received an update on the status of the return of live racing in two states.

More than 400 individuals participated in an afternoon webinar, moderated by Maryland Thoroughbred Horsemen’s Association Executive Director David Richardson, and sponsored by the MTHA, Pennsylvania Thoroughbred Horsemen’s Association and the Pennsylvania Horsemen’s Benevolent and Protective Association. Speakers with expertise in the loan or grant programs explained how they work and eligibility requirements.

“I want to repeat the action items,” said Bill Shaughnessy of the Gordon Feinblatt law firm in Baltimore. “This money is out there. And it can be grant money, but there is a short window. Go get your money.”

Among the federal programs discussed during the webinar are the Economic Injury Disaster Loan (EIDL) program and the Payroll Protection Program (PPP). Two Maryland programs—the COVID-19 Emergency Relief Loan Fund and the Small Business Emergency Relief Grant Fund—also were examined.

EIDL program

The federal program can provide up to $2 million in financial assistance to small businesses or private non-profits that suffer economic injury as a result of a declared disaster. It’s part of a pre-existing Federal Disaster Administration program that was modified to assist small businesses impacted by COVID-19.

Jim Michalak of Herbien and Co., a Pennsylvania accounting firm, said the $349 billion program offers loans of up to $10 million to businesses that have been operating since Feb. 15, 2020, and that have fewer than 500 employees. No collateral or personal guarantees are required.

Michalak said the program was “rolled out very quickly and that prompted changes on a daily or hour basis.” The United States Department of Treasury, he said, issued an interim final rule, but that could change.

Shaughnessy said an interesting component of the EIDL is the emergency advance provision that provides, even if the application is denied, $10,000 that doesn’t have to be paid back.


The $350 billion loan program is open to small businesses with fewer than 500 employees and includes independent contractors and self-employed individuals.

The amount any small business is eligible to borrow is 250% of their average monthly payroll expenses up to a total of $10 million. The amount is intended to cover eight weeks of payroll expenses and any additional amounts for making payments towards debt obligations. The eight-week period may be applied to any time frame between Feb. 15 and June 30, 2020.

“If you use funds properly and spend the money within eight weeks, that loan can be forgiven,” Shaughnessy said. “It’s a first-come, first-served program. If you’ve got an existing relationship with a SBA lender, call it in. It’s a government program to fund two months of payroll for your business.”

COVID-19 Emergency Relief Loan Fund and Small Business Emergency Relief Grant Fund

Amanda Chong of Gordon Feinbett said a Maryland business can apply for both the loan and grant programs, and she recommended applying for both. Independent contractors don’t qualify for either program, she said.

The Emergency Relief Loan Fund offers up to $50,000—not to exceed three months of cash operating expenses for business with fewer than 50 employees that have been impact by COVID-19. The interest rate is zero for the first 12 months and 2% for the remaining 36 months.

The Emergency Relief $50 Million Grant Fund offers working capital to assist small businesses and non-profits with disrupted operations due to COVID-19. Grant assistance is intended to provide interim relief complementing actions with its bank, business interruption insurance, and financial partners.

The program offers grants of up to $10,000 not to exceed three months of cash operating expenses for Maryland businesses and non-profits with 50 or fewer employees that are impacted by the COVID-19 pandemic.

“The programs are aimed at small businesses with W2 employees,” Chong said.

In Pennsylvania, Darren Smith, Vice President of Government Affairs for Wodjak Government Relations, said a $61 small business loan program stopped accepting applications after its first week. He said there are no current plans for related programs.

Smith also said the state has been overwhelmed by businesses seeking exemptions to Gov. Tom Wolf’s stay-at-home order through April 30.

Regarding the question of what qualified as an “agricultural” business in the federal EIDL program, Alan Foreman, Chief Executive Officer of the Thoroughbred Horsemen’s Association, said the industry is seeking clarity from government officials. But the belief is that activities at a training facility or racetrack are not considered agricultural, while a breeding farm is considered agricultural.

Foreman said lobbyists for the THA and National Thoroughbred Racing Association have reached out to members of Congress—who in turn have spoken to officials in the Trump administration—for assistance with language in various relief programs.

“We think it will be part of the discussions,” Foreman said. “We’re working at the national level to coordinate at the local level. We’re doing the best we can under the circumstances. Be assured we are conveying the needs and concerns of the racing industry.”

Shaughnessy said the application for an EIDL specifically asks if you are an agricultural industry. That, however, isn’t part of the PPP application process, he said.

“If you are applying under the EIDL program, the question of whether you are an agricultural entity will come up,” Foreman said. “If you are applying for the PPP, I don’t think you will have an issue.”

As for the recent shutdown of racing in Maryland and Pennsylvania and the timeline for its return, horsemen’s representatives offered their takes with the understanding that decisions hinge on actions by state government leaders. Live racing in both states was halted in mid-March.

“A lot of people have asked, ‘When are we going to run again?’ and the answer is, ‘As soon as physically possible,’ ” Richardson said. “We’re moving forward with a plan to begin racing without fans by the beginning of May and maybe by the end of this month.”

Richardson noted, however, that much depends on the status of COVID-19 cases in the state. In addition, with all Maryland casinos closed, there is pressure on the purse account, which gets about 70% of its revenue from video lottery terminals. It could take 45 to 60 days after racing resumes for the casino revenue to be realized, he said.

Two Pennsylvania representatives said they believe live racing will resume only when their respective casinos reopen.

“A (purse) issue certainly exists for us,” said Sal DeBunda, President of the PTHA, which represents horsemen at Parx Racing. “They will not consider opening the racetrack until the casino is open. We’re hoping that can happen in May–that’s the goal we are trying to set.”

DeBunda said the PTHA is paying Parx on a weekly basis to keep the facility open for training five days a week. “We are obligated to do that until racing resumes,” he said. “At least the horses will have their fitness and be ready to run as soon as possible. We’re spending a lot of time dealing with these issues.”

Todd Mostoller, Executive Director of the Pennsylvania HBPA, said it is improbable live racing will resume at Hollywood Casino at Penn National Race Course until the casino is back in action. He also said the purse account is in “good shape” for when live racing returns.

Smith said there has been pushback on Wolf’s shutdown of Pennsylvania businesses, and that the legislature may soon push for the reopening of certain businesses in the state.

The horsemen’s representatives noted there are legislative restrictions on how purse money derived from gaming can be used, a situation that makes floating subsidies during the down time for racing very difficult.

A recording of the April 3 webinar is available here.

The application for the Payroll Protection Program is available here.

More information on the various loan and grant programs and other developments is available at and