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Newsom releases new reopening framework. Here's what it means for California businesses

Nicole Hayden Melissa Daniels
Palm Springs Desert Sun

Gov. Gavin Newsom on Friday announced a new framework for reopening California businesses that were shuttered in July amid soaring coronavirus cases and hospitalizations. He called the system "more stringent" but "more steady," as it will allow counties to modify their activity based on the spread of COVID-19. 

Case rates and test positivity are the crucial metrics to be used by the state within a four-tier system to determine allowable reopening. Newsom said this is a simpler approach than what’s currently used, with a commitment to health equity.

The four tiers include:

  • Purple (widespread): Most non-essential indoor business operations are closed; more than 7 daily new cases per 100,000 residents; a positivity rate of 8% or higher
  • Red (substantial): Some non-essential indoor business operations are closed; 4-7 daily new cases per 100,000 residents; a 5-8% positivity rate
  • Orange (moderate): Some business operations are open with modifications , 1-3.9 daily new cases per 100,000 residents; a 2-4.9% positivity rate
  • Yellow (minimal): Most businesses open with modifications; less than 1 daily new case per 100,000; a positive rate of less than 2%.

If a county fails to meet their current tier’s metrics for two weeks, they will move back to the prior tier, Newsom said.

Heath and Human Services Secretary Mark Ghaly said the announcement is about a framework, not reopening. Friday's hospitalization case load of 4,205 is still higher than where the state was in June, Ghaly added. 

“This is just an important message to remind people that we’re not out of the woods,” Ghaly said.

However, the announcement was coupled with some changes to what is allowed: Hair salons in purple counties will be allowed to operate under state guidelines, for example, though counties can put stricter guidelines in place.

Newsom showed a map indicating much of Southern California, except for San Diego County, is in purple. That means changes can’t be expected for at least another three weeks, Ghaly said, as the counties will have to meet the metrics for a mandatory 21-day wait time to move to a lower tier that allows more business reopenings. 

In explaining the reason to have a new case rate determination, Newsom said looking at the number of new cases per day per 100,000 residents provides more specificity compared to a 14-day case rate.

Newsom introduced the guidelines by saying that it’s clear the coronavirus isn’t going away any time soon. He said the state must “live with this fundamental truth until there is a vaccine” or therapeutics help manage the spread of the virus.

“We will simply need to adapt our behaviors until that time,” he said.

The governor also spoke about empowering consumers: He said the state is developing partnerships with online platforms like Yelp and OpenTable that can help businesses and customers share information about what may or may not be happening at a particular place.

“We want to empower individuals to know as customers what is happening in terms of the safety that is being provided,” he said.

Newsom's announcement comes as California slogs through an economic recession that started this spring when his stay-at-home order, meant to tamp down the spread of coronavirus, caused a grinding halt to the state's economy. 

The state had a 13.3% unemployment rate in July, up slightly from June but representing more than 2.5 million Californians who are out of work.

Restaurants across state are 'on life support'

In anticipation of the Democratic governor's announcement, there was a common refrain from businesses and local governments buffeted by the outbreak: We need clarity.

Counties needed to understand clearly “what thresholds to aim for and the public health data that will determine success or failure,” the California State Association of Counties said in a statement.

That was echoed by the California Restaurant Association, which has seen the state's once-thriving food industry wither under restrictions that closed indoor dining rooms and left many businesses to survive on takeout, delivery and limited outdoor seating, if they had the space. The association estimates as many as 1 million workers have been furloughed or laid off.

"We'd like to see restaurant dining rooms reopen as soon as possible," association president Jot Condi said.

“Restaurants in every corner of the state are on life support right now. Every day that passes with a dining room closed, a restaurant owner is more likely to shut the doors permanently," Condi said. “It's gotten to a crisis level."

Officials call for clarity from state guidelines

Riverside County Supervisor Karen Spiegel, who has recovered from a bout with the virus, said she hoped the state plan would recognize different levels of risk that come with different business activities. She’s been puzzled why shoppers can fill a Costco, where she stopped Thursday, while indoor hair salons remained off limits. 

Using metrics, the state needed to change how businesses are categorized, Spiegel said. “We have to do more of a risk-based approach.”

California has the most confirmed virus cases in the nation, with nearly 700,000, and the third-most deaths — 12,550. But since the closures last month, the average number of daily cases has been falling along with the infection rate and hospitalizations, which peaked at 7,170 on July 21 and since dropped to about 4,300. 

Most of California’s 58 counties, including the most populous — Los Angeles — remained on a state monitoring list before Friday because they were above one or more of the benchmarks for cases, infection rates and hospitalizations. Inclusion on the list restricted which businesses could operate, whether schools could offer classroom instruction and limits other activities, such as attending indoor religious services. 

But as the state’s coronavirus data has improved in recent weeks, some counties got off the list, including San Diego and Orange, the second- and third-largest counties by population.

San Diego Mayor Kevin Faulconer joined Spiegel in expressing frustration with the changing guidelines. There have been widespread complaints that even when counties hit benchmarks that would allow them to reopen, the state had no clear rules to do so.

“The confusion keeps growing over California’s constantly shifting coronavirus lockdown rules,” Faulconer tweeted. The Republican, who is seen as a potential challenger to Newsom in 2022, wrote that the county had been dropped from the monitoring list as a result of falling case numbers and other favorable metrics but "we're still waiting for answers."

Counties can open schools for classroom learning if they are off the watch list for 14 days, but the governor is facing legal challenges to set aside state orders that prevented schools from offering traditional classroom instruction.

“We would love to see the governor make an announcement that he is reopening schools to in-person attendance all across California,” said attorney Robert Tyler, whose firm has filed petitions with the California Supreme Court seeking to reopen classrooms on behalf of the Orange County Board of Education and other public and private schools.

Newsom's announcement has political implications. With the election approaching, Republicans have been seizing on the long-running virus restrictions that have recast daily life for many to criticize his leadership.

California's reopening déjà vu

This is not the first time the state is dialing its reopening switch back and forth.

At the start of the pandemic, Newsom told Californians not to expect a quick return to normalcy. But as spring pushed into summer, he loosened the rules after receiving pushback from counties that failed to meet the state's original reopening metrics.

During the third week of May, California approved 49 counties to reopen businesses such as indoor retail and dine-in restaurants just days before Memorial Day. Of those counties approved to reopen, 49% failed to meet at least one reopening criteria mandated by the state, according to an analysis by The Desert Sun. These criteria included thresholds for conducting enough tests per day and hiring enough contact tracers to investigate cause of virus spread.

The reopenings were coupled with new guidelines from the California Department of Public Health that spelled out steps that could be taken to keep people safe, such as spacing out restaurant tables 6 feet apart and requiring employees at public-facing businesses to wear masks. 

Still, fourweeks after the Memorial Day holiday on May 25, the number of COVID-19 hospitalizations across the state jumped 67%, including a 45% rise in the number of intensive care unit beds occupied by COVID-19 patients.

Even with cases rising, many counties received the OK to reopen bars, gyms and movie theaters in mid-June. The virus continued to spread quickly.

With a combination of back-to-back reopenings and a handful of holidays, contact tracers had difficulty understanding where community spread truly came from. And while the prior moves to reopen were coupled with the hopes that the economy would rebound, the signs of recovery were slow: The state’s unemployment rate went from 16.3% in May to 14.9% in June, and just 25% of the jobs lost during March and April had been regained, according to the state’s Employment Development Department.

As cases continued to spike statewide, Newsom reordered bars and indoor dining to close in counties on the state's watch list ahead of the Fourth of July holiday. A week later, counties on the list were ordered to also close indoor gyms and salons.

Still, in the month following the Fourth of July holiday, 37 of the state’s 58 counties saw case counts at least double, according to California Department of Public Health data analyzed by The Desert Sun, largely attributed to holiday and family gatherings.

The state hit its peak on July 24, reporting 10,005 new daily cases based on a seven-day average, falling squarely within the amount of time it takes for new cases to appear post-spread based on the virus' incubation period.

Since then, the total number of new cases has ticked downward in response to the reinstated closures. The state reported a seven-day average of 5,775 on Aug. 24. The last time the state saw a count of new daily cases this low was at the end of June, right before the impact of May's reopening and holiday celebrations led to the string of record-breaking daily cases in July. 

These trends show that the virus has not steadied but that prior toggling of reopening metrics, such as the restrictions placed on businesses and socializing, directly impacts community spread.

The Associated Press contributed to this report.

Nicole Hayden covers health in the Coachella Valley. She can be reached at Nicole.Hayden@desertsun.com or (760) 778-4623. Follow her on Twitter @Nicole_A_Hayden.

Melissa Daniels covers economic development, hospitality and local business in the Coachella Valley. She can be reached at (760)-567-8458, melissa.daniels@desertsun.com, or on Twitter @melissamdaniels.