This is one of the hardest columns I’ve ever tried to write. To be honest, I’m not sure what to say. I’d like to offer reassurance that everything will eventually return to normal, but I don’t know that. I could suggest that the best plan is to weather this storm by doing A, B and C, but I don’t have the playbook for a pandemic.
So, like many of you, I’m trying my best to adapt to the situation. After 30-plus years of going to an office, I’m working from home. It’s been a major adjustment, but I don’t have to shower as often. The dog won’t leave me alone, and my son is home schooling, but otherwise publishing is practically made for telecommuting.
You certainly face more difficult challenges. We’ve talked with a number of shop owners to learn about those challenges and how they are responding. Please read and learn from the story on Page 8.
The best I can offer is information about the CARES Act, which contains $376 billion in relief for American workers, small businesses, and SBA funding programs, including the Paycheck Protection Program, EIDL Loan Advance, SBA Express Bridge Loan and SBA Debt Relief.
The Paycheck Protection Program provides small businesses with funds to pay up to eight weeks of payroll costs, including benefits. Funds can also be used to pay interest on mortgages, rent, and utilities.
The funds are provided in the form of loans that will be fully forgiven when used for payroll costs, interest of mortgages, rent, and utilities. Loan payments will also be deferred for six months. No collateral or personal guarantees are required. Neither the government nor lenders will charge small businesses any fees.
Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease.
Small businesses with 500 or fewer employees, including self-employed individuals, sole proprietorships, and independent contractors, are eligible.
Small businesses can also borrow up to 2.5 times their total monthly payroll (with a maximum of $10 million) using their payroll numbers from before the crisis at 1 percent interest. Repayment will be deferred for six months.
You can apply through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating. You should consult with your local lender as to whether it is participating. All loans will have the same terms regardless of lender or borrower.
The EIDL Loan Advance program provides up to $10,000 of economic relief to businesses that are currently experiencing temporary difficulties.
SBA Express Bridge Loans allow small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 quickly.
SBA Debt Relief provides a financial reprieve to small businesses during the COVID-19 pandemic.
This article originally appeared in the May 2020 issue.