Small business owners tapping into personal savings, 401(k)s and more amid coronavirus crisis

Luis Rivera and his family have run their neighborhood rotisserie chicken joint in downtown New York City for nearly five decades, staying open through everything from 9/11 to Superstorm Sandy, but he said he's never seen anything like the coronavirus pandemic.

Rivera is among a handful of small business owners -- many of whom already operate on razor-thin margins -- who say they are entering times of unprecedented uncertainty. Despite pledges from the government and private sector, many say they still don't know how they will possibly pull through.

"I didn't expect it to be so quick," Rivera, who owns the Casa Adela restaurant, told ABC News of the impact to business. "I don't know how to deal with it. I'm trying to make ends meet."

Seemingly overnight, he said his restaurant went from booming to completely empty, and with new city restrictions on businesses and social gatherings, they are now only allowed to offer take-out and delivery.

"I’m kind of worried as to -- at what point does it stop?" he said. "I'm hoping that there will be some sort of an answer."

Right now, he is most worried about how he will meet payroll and utility bills.

"I need the telephone to take orders, I need the electricity to make the food," he said.

"I think the government could do more to appease people who are very worried," he added. "But I don't think anything more can be done until someone has a cure."

Many small businesses are already not insulated to economic hits -- only 50% last more than five years, according to the federal government's Small Business Administration, and a steep reduction in business could prove devastating.

Facebook pledged $100 million in grants on Tuesday to small businesses hit hard by the COVID-19 outbreak, though the company only said it would start taking applications "in the coming weeks." Other companies have announced similar steps to lessen the blow, including Citi, which promised waivers for monthly service fees and more for small business-owner clients.

The SBA pledged late last week it would offer up to $2 million in low-interest loans to small businesses to help them weather the storm.

"Small businesses are vital economic engines in every community and state, and they have helped make our economy the strongest in the world," SBA Administrator Jovita Carranva said in a statement. "Our Agency will work directly with state Governors to provide targeted, low-interest disaster recovery loans to small businesses that have been severely impacted by the situation."

The loans can be used to help with payroll, bills and pay fixed debts. For small businesses without credit available elsewhere, the interest rate is 3.75%, and long-term repayment plans for up to 30 years are available.

A handful of state and local governments also announced similar actions.

San Francisco announced it is deferring quarterly business taxes due April 30 for nine months until February 2021 with no interest or penalties. Moreover, it is deferring small business licenses and permit fees for three months. The city also established a "COVID-19 Small Business Resilience Fund," which will offer emergency grants of up to $10,000 for microbusinesses that can show a recent loss of revenue.

New York City pledged similar relief. Small businesses with fewer than 100 employees who have seen sales decrease by 25% or more will be eligible for zero-interest loans of up to $75,000, according to Mayor Bill de Blasio's office. Businesses with fewer than five employees may also be eligible for a grant to cover 40% of payroll costs for two months to help retain employees.

Dawn Kelly, 57, from the Queens borough of New York City, operates the hole-in-the-wall health foods place The Nourish Spot, and said she wants to see more action being taken to help small businesses like hers survive amid the pandemic.

Despite the low or no interest rates, "I’m loath to take a loan," Kelly told ABC News, saying times are already so uncertain," and then you take a loan and you're just going to have to owe somebody."

Moreover, Kelly said she doesn't qualify for grants from the city.

Despite being named "Microbusiness of the Year" by the U.S. Small Businesses Administration last year, Kelly said that she has seven employees versus the five or less you need to qualify for the microbusiness grants.

Even before the coronavirus crisis, Kelly said the bottom line for operations was tight.

"I don't take a salary yet," she said. "I’m a new entrepreneur, I reinvest profits into the salaries of the other individuals and the food we buy."

She has already decreased her operating hours and said that while she is not at the point yet where she wants to or has to fire anyone, "everything is on the table."

The single mom said she is prepared to tap into her personal savings "and even raiding my 401(k) if necessary" to get by.

"I'm an optimistic at heart, so I try to believe that everything is going to work out because the governor and the mayor have allowed small businesses that serve food to remain open," she said. "I do believe there is a need for us, because there are people who don't have cars and don't have nearby supermarkets."

Not only has foot traffic disappeared and financial worries loom large, Kelly said that all aspects of her business has been forced to change since the outbreak hit New York.

Since this past weekend, Kelly said she's "not letting people in" and serving customers at the door.

"We keep the door locked, we go to the door and we give them their food from behind the door with gloves on," she said. "Same thing with our delivery app drivers; we’re not letting them in, they are showing us their phone through the window."

While government agencies and more tout their efforts, she said she would like to see more done for small business owners in the community who are often the first to feel the impacts of economic downturns.

"Change the particulars around the grant money," she said. "I think the grant should have been at least 10 employees or less."

She said in times like these, she would also like to see more relief when it comes to certain taxes and rent payments. While she is not worried about missing April's rent, beyond that she said it's all uncertain.

Currently, Kelly is focusing on what she can do and "promoting the business like I’ve lost my mind" on social media.

"I need to make sure that people know we are still open and operating and available to nourish them," she said.