COVID-19 ECONOMIC INJURY DISASTER LOANS
The U.S. Small Business Administration (SBA) is offering designated states and territories low-interest federal disaster loans for working capital to small businesses suffering substantial economic injury as a result of the Coronavirus (COVID-19).
The SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance and can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.
These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses. The interest rate for non-profits is 2.75%.
The SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.
Applicants will apply directly to the SBA, which is estimating it will take about 21 days to process the applications. Once approved, they are expecting about another five to seven days to disperse the funds directly from the U.S. Treasury to the applicant.
You can find out more information in the SBA's Three-Step Disaster Loan Process Sheet, one pager, presentation and the governor's press release
Legislation passed 4/23 provided additional funding to the EIDL ($50B) and EIDL advance ($10B) programs. In addition, it relaxed eligibility requirements so agricultural businesses including businesses engaged in the legal production of food and fiber, ranching, and raising of livestock, aquaculture, and all other farming and agricultural related industries (as defined by section 18(b) of the Small Business Act (15 U.S.C. 647(b)) are eligible for the EIDL and EIDL advance. These businesses would still need to meet the criteria of having 500 or fewer employees.
The portal is now open for ag businesses to apply a this site. Any assistance you can provide in getting the word out is greatly appreciated.
Note: Only agricultural businesses are eligible to apply at this time. Non-agricultural businesses who make application at this time will have their applications returned.
For questions, please contact the SBA disaster assistance customer service center at 1-800-659-2955 (TTY: 1-800-877-8339) or e-mail email@example.com.
The Small Business Administration works with different organizations to provide federal financial assistance (grants) community resources for certain small businesses.
Paycheck Protections Program
The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll.
SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.
The Paycheck Protection Program will be available through June 30, 2020. For more information click here. Click here to view a sample application.
To date we have approximately $140 billion in PPP appropriation remaining. We continue to push the program out and educate small businesses and entrepreneurs. In the district office, we continue to push the programs broadly to include focus on sole proprietors, self-employed, and independent contractors to ensure they understand the program and are able to access it. We provided PPP training for sole proprietors last week and it is recorded at this site: https://bit.ly/loanwebinar2.
Treasury released an updated FAQ (#40-42) which cover forgiveness when employees decline to return, seasonal employers, and non-profit hospitals. This document can be found here.
The “How to calculate loan amounts” document on the Treasury website is a great tool, especially for sole proprietors. It offers guidance for those that capture their business income in different forms (Schedule C, Schedule F, K-1, etc.). It can also be used to inform lenders of the various, approved options to document self-employed income.
Employee Retention Credit
To encourage employers to keep employees on their payroll, despite experiencing economic hardship related to COVID-19, the CARES Act includes an employee retention tax credit (Employee Retention Credit). Employee Retention Credit, designed to encourage businesses to keep employees on their payroll. The refundable tax credit is 50% of up to $10,000 in wages paid by an eligible employer whose business has been financially impacted by COVID-19. You can find out more information here.
The federal stimulus package passed in March provides emergency assistance and health care response for individuals, families and businesses affected by the 2020 coronavirus pandemic. You can read the bill in entirety here.
Senator McConnell’s summary is here.
U.S. Chamber information on how businesses can benefit from the CARE Act here.
The legislation contains numerous programs and we will continue to update the site as more information becomes available.
The U.S. Chamber has created Coronavirus Emergency Loans and Small Business Guide and Checklist to help small businesses, independent contractors, gig economy workers and other qualifying individuals prepare to file for a coronavirus relief loan under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Click here to download the guide, and click here for the Spanish version.
CO—has created a Coronavirus Small Business Guide to help you navigate the pandemic with new stories daily—including a detailed breakdown of federal stimulus aid programs, information about managing financial difficulties, keeping your team engaged, supporting and retaining your customers, and more.
United States Senator Dick Durbin
As the United States continues to address the coronavirus pandemic, I’m focused on ensuring the federal government is doing everything it can to support the health and safety of Illinoisans. Addressing the spread of the virus will take a whole-of-government approach and coordination with the State of Illinois as preventive measures are implemented. We also must support working families during this difficult time and provide health care professionals and scientists with every resource they need for treatments and research into COVID-19. For more information click here
Federal Reserve Main Street Lending Program
The Federal Reserve established a Main Street Lending Program to support lending to small and medium-sized businesses that were in sound financial condition before the onset of the COVID-19 pandemic. Click here for more information. Please see here for the announcement on expansion press release. Main street lending program FAQs.
Coronavirus Emergency Loans Guide and Checklist for Small Business and Nonprofits
Starting April 3, small businesses and sole proprietorships can apply for loans through existing SBA lenders. Starting April 10, independent contractors and self-employed individuals can apply for loans through existing SBA lenders. Other regulated lenders will be available to make these loans as soon as they are approved and enrolled in the program. Click here for more information.