Business owners & leaders: If your business has been adversely affected by the coronavirus directly or indirectly, we encourage you to explore and apply for Paycheck Protection Program (PPP) forgivable loan or the Disaster Loan (& grant) Assistance programs below, given that the PPP started 4/3/20 for small businesses, and 4/10/20 for sole proprietorships and independent contractors. The program expects high application volume, and funds may run out quickly. Almost all small businesses (500 employees or less) are eligible. Some companies over 500 employees are also eligible, for example those in hospitality and certain other industries and franchises, which allow 500 per location, rather than the overall company total, possibly with some exceptions.
The recent CARES Act’s Payroll Protection Program creates a forgivable loan program for all small businesses, with few exceptions. You could receive up to the equivalent of 250% of your monthly “payroll costs,” (2 months plus an additional 25% for non-payroll costs), up to $10,000,000, and note that “payroll costs” for this program include certain compensation, as well as rent, health insurance and other costs (see links below for details). This is an excellent opportunity to retain jobs, help your business, and thereby stimulate the economy during this coronavirus period.
Some banks will initially gather primarily or only the basic information required by the SBA application (see link below, which may be helpful as a sample application for part of the information your bank will require), and then your bank may follow up with borrowers for any additional documentation the bank requires. Below are some resources and tips that may help. At bottom, summary information for a separate program, SBA’s Disaster Loan Assistance (DLA), is also provided ($10k grant, plus up to $2m in loans). It is allowable to apply and receive funding from both the PPP and DLA programs).
Summaries of the PPP program, with similar but different levels of clarity:
https://home.treasury.gov/system/files/136/PPP%20Borrower%20Information%20Fact%20Sheet.pdf
https://www.uschamber.com/sites/default/files/023595_comm_corona_virus_smallbiz_loan_final.pdf
Application form (note: Your bank will likely require their own similar form or on-line input/submission):
https://home.treasury.gov/system/files/136/Paycheck-Protection-Program-Application-3-30-2020-v3.pdf
PPP program information (updated periodically by SBA):
https://home.treasury.gov/policy-issues/top-priorities/cares-act/assistance-for-small-businesses
The PPP requires that you use a SBA 7(a) approved lender. The link below shows the top-100 lenders, but NOTE that many lenders will only take applications if you are an existing business customer, and some will only take applications if you also have a lending relationship with that bank, so contact your company’s bank first. :
https://www.sba.gov/article/2020/mar/02/100-most-active-sba-7a-lenders
A few hints that may help during your PPP application process:
The information above expands on an email sent to clients 3/31/20, and a separate post to this blog.
Disaster Loan Assistance program: This is a new program, separate from the Payroll Protection Program, but you can apply for both DLA and PPP, apparently with the caveat that the purposes need to be different, possibly such as economic harm vs. job retention:
Please periodically check back to review this blog-post, as we may add additional information as it becomes available. Updates:
4/3/20: Clarification about not counting contractors within small business applications.
4/6/20: Additional clarification about not counting contractors within small business applications. Loan payments deferrals. Paid-sick and paid-family leave payments exclusions. Question about full-time vs part-time employees, and possible clarification.