The U.S. Small Business Administration makes the American dream of business ownership a reality.As the only go-to resource and voice for small businesses backed by the strength of the federal government, the SBA empowers entrepreneurs and small business owners with the resources and support they need to start, grow or expand their businesses, or recover from a declared disaster.
Business owners can apply for the Paycheck Protection Program at any lending institution that is SBA approved to participate.
The loan advance will provide economic relief to businesses that are now experiencing a temporary loss of revenue.
MEDC has allocated $10 million for small business relief loans across the state.
The new program is supposed to provide loans of up to $10 million per firm, and companies may have the debt written off by retaining employees or rehiring employees already let go, among other terms. It's a very large investment by the government to keep money flowing to workers, while at the same time positioning businesses like yours to snap back quickly once the crisis subsides.More news: Russian Federation sends planeload of medical supplies to US
The loans are being guaranteed by the Small Business Administration. The amount of principal that may be forgiven is equal to the sum of expenses for payroll, and existing interest payments on mortgages, rent payments, leases, and utility service agreements.
A "stripped down" loan application is just four pages, with the loan amounts determined by 2.5 times average monthly payroll amounts. Businesses with more than 500 employees are eligible in certain industries.
Repayment will be deferred for six months and the loans fully forgiven if used for payroll and other qualifying expenses.
The complicated requirements surrounding such loans, however, have created confusion for small businesses with investors and other affiliations on whether or not they would qualify. That program, the Treasury Department's Exchange Stabilization Fund, requires loans to be used to retain at least 90% of the company's workforce.
Companies, nonprofits, self-employed people, independent contractors, cooperatives and employee-owned businesses are all eligible.More news: Coronavirus crisis: Australia’s COVID-19 death toll rises to 21
Small businesses and other eligible entities can apply if they were harmed by COVID-19 between February 15 and June 30, and must do so through a money lender and/or a bank.
Hibben said this type of loan program could be a great thing if it ends up being a good way for local businesses to keep already trained and loyal staff.
The Paycheck Protection Program is being advised for business looking for money to cover the cost of keeping employees during the economic downturn.
Officials from the U.S. Treasury and Small Business Administration, which are jointly administering the so-called Paycheck Protection Program, said they were working to ensure that processing capabilities, both in person at SBA lenders and online, would be able to handle high volumes of applications on Friday.More news: TC Energy going ahead with Keystone XL with help from Alberta government