Small Business Assistance
Treasury Department Releases Paycheck Protection Program Application for Small Businesses; Distribution Effort Begins
Earlier this afternoon (March 31), SBA Administrator Jovita Carranza and Treasury Secretary Steven T. Mnuchin announced that the SBA and Treasury Department have initiated a robust mobilization effort of banks and other lending institutions to provide small businesses with the capital they need.
The CARES Act establishes a new $349 billion Paycheck Protection Program. The Program will provide much-needed relief to millions of small businesses so they can sustain their businesses and keep their workers employed. Small businesses and eligible nonprofit organizations, veterans organizations, and tribal businesses described in the Small Business Act, as well as individuals who are self-employed or are independent contractors, are eligible if they also meet program size standards.
“This legislation provides small business job retention loans to provide eight weeks of payroll and certain overhead to keep workers employed,” said Secretary Mnuchin. “Treasury and the Small Business Administration expect to have this program up and running by April 3rd so that businesses can go to a participating SBA 7(a) lender, bank, or credit union, apply for a loan, and be approved on the same day. The loans will be forgiven as long as the funds are used to keep employees on the payroll and for certain other expenses.”
The new loan program will help small businesses with their payroll and other business operating expenses. It will provide critical capital to businesses without collateral requirements, personal guarantees, or SBA fees – all with a 100% guarantee from SBA. All loan payments will be deferred for six months. Most importantly, the SBA will forgive the portion of the loan proceeds that are used to cover the first eight weeks of payroll costs, rent, utilities, and mortgage interest.
The new loan program will be available retroactive from Feb. 15, 2020, so employers can rehire their recently laid-off employees through June 30, 2020.
Paycheck Protection Program Info:
CARES Act | What You Need to Know:
Families First Response Act: IRS & U.S. Dept of Labor Issue Guidance
Earlier this afternoon (March 31), SBA Administrator Jovita Carranza and Treasury Secretary Steven T. Mnuchin announced that the SBA and Treasury Department have initiated a robust mobilization effort of banks and other lending institutions to provide small businesses with the capital they need.
The CARES Act establishes a new $349 billion Paycheck Protection Program. The Program will provide much-needed relief to millions of small businesses so they can sustain their businesses and keep their workers employed. Small businesses and eligible nonprofit organizations, veterans organizations, and tribal businesses described in the Small Business Act, as well as individuals who are self-employed or are independent contractors, are eligible if they also meet program size standards.
“This legislation provides small business job retention loans to provide eight weeks of payroll and certain overhead to keep workers employed,” said Secretary Mnuchin. “Treasury and the Small Business Administration expect to have this program up and running by April 3rd so that businesses can go to a participating SBA 7(a) lender, bank, or credit union, apply for a loan, and be approved on the same day. The loans will be forgiven as long as the funds are used to keep employees on the payroll and for certain other expenses.”
The new loan program will help small businesses with their payroll and other business operating expenses. It will provide critical capital to businesses without collateral requirements, personal guarantees, or SBA fees – all with a 100% guarantee from SBA. All loan payments will be deferred for six months. Most importantly, the SBA will forgive the portion of the loan proceeds that are used to cover the first eight weeks of payroll costs, rent, utilities, and mortgage interest.
The new loan program will be available retroactive from Feb. 15, 2020, so employers can rehire their recently laid-off employees through June 30, 2020.
Paycheck Protection Program Info:
- For an overview of the program, CLICK HERE.
- If you’re a lender, more information can be found HERE.
- If you’re a borrower, more information can be found HERE.
- The application for borrowers posted HERE.
CARES Act | What You Need to Know:
- For the full text of the CARES Act, VISIT HERE
- View the U.S. Chamber of Commerce Small Business Guide for a summary of CARES Act small business provisions in this legislation.
- View the Frequently Asked Questions (FAQs) for the CARES Act prepared by the U.S. Senate Committee on Small Business and Entrepreneurship.
Families First Response Act: IRS & U.S. Dept of Labor Issue Guidance
- View the U.S. Internal Revenue Service notice “Effective Date for Employment Tax Credits Under the Families First Coronavirus Response Act.” This includes further details on the IRS tax provisions included in the Phase II COVID-19 legislation. [VISIT HERE]
- View The U.S. Department of Labor FAQ document regarding specific labor provisions included in the Families First Coronavirus Response Act (Phase II), including paid sick leave and expanded FMLA. [VISIT HERE]
- Employers' Guide to Coronavirus Paid Leave Programs - U.S. Chamber [VISIT HERE]
SBA Loans for Small Businesses Impacted by COVID-19
With revenue loss and cash flow top of mind for many small businesses in Central Kentucky impacted by COVID-19 restrictions, small businesses are highly encouraged to reach out to their local bank to inquire about short-term loans and other options given recent federal actions. The U.S. Small Business Administration (SBA) is also setting up emergency disaster relief loans for small businesses seeking economic relief in Kentucky.
For assistance in filling out the SBA Disaster Loan application, potential loan applicants can:
1. Go to their local bank as most banks handle SBA loans
2. Visit https://kysbdc.ecenterdirect.com/signup and complete the questionnaire “Request for an Appointment” to reach a local SBDC Business Coach.
3. Go to the KSBDC's Coronavirus page for more guidance.
With revenue loss and cash flow top of mind for many small businesses in Central Kentucky impacted by COVID-19 restrictions, small businesses are highly encouraged to reach out to their local bank to inquire about short-term loans and other options given recent federal actions. The U.S. Small Business Administration (SBA) is also setting up emergency disaster relief loans for small businesses seeking economic relief in Kentucky.
- The SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance per small business and can help overcome the temporary loss of revenue. 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 without credit available elsewhere; businesses with credit available elsewhere are not eligible. The interest rate for non-profits is 2.75%. 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.
- Kentucky is currently in the process of becoming eligible through SBA for this loan assistance program.
- Access more information and instructions at www.sba.gov/disaster.
- Start the disaster loan application process on-line at https:/disasterloan.sba.gov/ela
For assistance in filling out the SBA Disaster Loan application, potential loan applicants can:
1. Go to their local bank as most banks handle SBA loans
2. Visit https://kysbdc.ecenterdirect.com/signup and complete the questionnaire “Request for an Appointment” to reach a local SBDC Business Coach.
3. Go to the KSBDC's Coronavirus page for more guidance.
