Rocco Maglio
Hernando Sun Co-Founder
Nearly a year ago Hernando Sun applied for a PPP loan with the intention that it would be forgiven because we incurred significant losses during the pandemic. As an essential business, we managed to remain open paying our contributors their usual earnings.
The Hernando Sun is a newspaper and therefore during an emergency, we are an essential business providing local information for our readers in print and online. During the pandemic, we informed our readers about the county and state government guidance and rule changes. We provided information on community resources to help those suffering during the pandemic. We reached out to local hospitals and reported on how they were being affected by the pandemic and what to expect if you needed to use their services and what services they were providing.
The Hernando Sun uses mostly 1099 contractors. The skills needed to produce a newspaper are very specific and as a weekly newspaper we need a tremendous variety of skills, so we partially employ a large number of people. All of our contributors have additional jobs outside of the newspaper and therefore we pay them as contractors. Julie and I, co-founders of the paper, do not receive compensation. For Julie, the newspaper is a full-time job.
The PPP guidance for contractors is that they apply for assistance on their own and that employers cannot be reimbursed for 1099 payments. This is a catch 22 for us as an essential business because it assumes that the business was closed during the pandemic, which we were not. We stayed open during the pandemic and therefore our contributors received payments for their contributions during the pandemic and cannot apply for forgivable PPP loans because they did not have any losses. The Hernando Sun saw substantial losses in ad revenue as businesses attempted to weather the pandemic and made difficult cuts. Julie and I used substantial amounts of our own money to continue printing during the pandemic.
To add insult to injury our main competitor received at least $7 million in assistance during the pandemic. The PPP program assumes that any business without W2 employees is unnecessary and that means that many of these companies will be crushed by the pandemic.
The COVID-19 assistance was intended to help businesses that maintained their employees’ earnings during the pandemic. We not only maintained our compensation we increased it, adding additional contributors and our first full-time employee.
Since our founding in 2015, the Hernando Sun has put around a million dollars into the local economy. We have provided compensation to dozens of contributors and supported many local events and charities.
As a newspaper, we are essential in informing the community during a crisis, but the US Treasury Department has decided we do not deserve any COVID-19 assistance because our contributors are compensated as independent contractors and our founders receive no compensation.
