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Congress ended the week without an agreement on a coronavirus aid package, leaving the economy without one key stimulus program and many Mainers wondering whether they will be able to pay rent or keep their businesses.
Friday marked the scheduled sunset of a $600 weekly federal unemployment bonus. Sen. Susan Collins of Maine and two other Republicans tried to partially extend the benefit with a last-minute bill introduced Thursday, but it did not go anywhere. A new stimulus might also allow for businesses that already received a forgivable loan under the Paycheck Protection Program to get a second loan.
The stalemate comes at a time when jobless claims continue to be high nationwide and a decline in consumer spending dampens the economy. On Thursday, the U.S. Bureau of Economic Analysis estimated that the country’s gross domestic product, a measure of the value of goods and services, decreased at an annual rate of 32.9 percent from April to June.
Last week’s unemployment claims in Maine were at 2,600 compared to the 634 applications filed for the week ending March 14, before restrictions on businesses in the state took effect. Maine stands to lose 12,000 more jobs with the lapse of the enhanced unemployment benefits, according to the liberal-leaning Economic Policy Institute.
Bianca Brancella of Rockland has worked seasonally at the Rockland Cafe since she was a teenager, but it has been closed all summer. She has been looking for work, but that is hard in a town where most businesses don’t have space to bring on all their regulars, let alone someone new.
Earlier in the pandemic, she struggled to pay rent on time, though she was able to do so with the help of the weekly $600. In mid-June, however, her landlord informed her that he wanted her and her fiance to leave when their lease expired at the end of July.
She’s been looking for housing, but with an uncertain return date to work and with only her regular state unemployment benefits, she’s struggling to show the proof of income that landlords usually want.
“What I got was gone, right to the bills, and that made me feel so good, like kind of safe for a while and now I need a storage unit, rent and somewhere to live,” Brancella said. “I don’t know why they’re taking that away.”
Jason, an unemployed worker in Jefferson who asked that only his first name be used, said he had to get a six-month forbearance on his mortgage. Without that, he said he would be in foreclosure.
He said he is “living on the edge” making $16,000 to $24,000 a year and living off of the food bank, an experience he describes as defeating because people look down on him.
“The people in Washington don’t live like the rest of us. They have no earthly conception of what it’s like to actually live on the level that most Americans do,” he said.
Banks are preparing for a second wave of deferral requests from home and business borrowers who have already deferred three months. Camden National Bank executives told Wall Street analysts on Tuesday that the bank had $547 million in deferrals as of July 23 and that it was expecting borrowers to either defer another 90 days or modify existing loans.
Bob Smith, owner of the Sebasco Harbor Resort in Phippsburg, said he’d jump at the chance to apply for a second federal business loan. Smith, who has 128 bedrooms in 40 buildings at the resort, said the first Paycheck Protection Program loan helped him get up and running at the beginning of the pandemic, when tight restrictions were in place.
However, he has only recovered half of his business, having lost all but one of the four weddings and business events this year to cancellations, and is worried about next year.
“Unless there’s another program, I’m not going to have any choice but to downsize and lay people off or maybe close for the season,” he said.
BDN reporter Jessica Piper contributed to this story.