In late December, Governor Wolf announced plans to borrow $145 million from the state’s Workers’ Compensation Security Fund to provide funding for businesses adversely affected by COVID-19-related lockdowns. “Our business owners and workers have been forced to make sacrifices because of COVID-19 and they need and deserve our support,” Wolf said.

The Workers’ Compensation Fund, from which the funding would come, is a state account that provides benefits to injured workers whose workers’ compensation insurance companies are no longer solvent. Should the fund drop below a statutory minimum balance of $500 million, it triggers an assessment on insurers and self-insured employers, which would increase insurance costs for businesses. The fund was also recently reduced by $185 million to balance the 2020-21 state budget. Should the $145 million transfer occur for business grants as the Governor has proposed, the balance will drop to around $635 million, still above the minimum threshold at which assessments will occur.

In order to provide the assistance as grants to impacted businesses, the General Assembly would need to approve of the measure. Republican legislative leaders did not comment on whether they would agree to the funding transfer, but House Republican Majority Leader Kerry Benninghoff urged Governor Wolf to work with the legislature, rather than unilaterally mandating shutdowns and restrictions, to help businesses recover. “Going alone is not what is best for Pennsylvanians. We need to work together, and I encourage Gov. Wolf to work with us on relief plans and join us in focusing on long-term solutions that keep Pennsylvanians working and businesses and restaurants operating safely.”

It’s unclear how the grants would be distributed and which businesses would be eligible if approved by the legislature. Previously, state small business grants were provided through the COVID-19 Small Business Grant, distributed through Community Development Financial Institutions.

NFIB in Pennsylvania continues to track discussions in Harrisburg relating aid for small business harmed by COVID-19 closures and the related economic climate.