Our nation’s independent exhibitors and other small businesses are facing an unprecedented economic disruption due to the Coronavirus (COVID-19) outbreak. On Friday, March 27, 2020, the President signed into law the CARES Act, which contains $376 billion in relief for American workers and small businesses. Click the button below to see what options are available under the CARES Act.
NOTE: ICA members are strongly urged to discuss their options directly with their bank, accountant, and/or attorney for advice and guidance.
Alert PPP Loans Now Open
Eligible small businesses, sole proprietors, and others can apply for a loan through the $350 billion Paycheck Protection Program (PPP) enacted as part of the $2.2 trillion CARES Act stimulus package. In constantly evolving guidance, the Department of the Treasury is encouraging small businesses “to apply as quickly as you can because there is a funding cap.”
The PPP program aims to 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 and 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. For an overview of the loan terms, Click Here.
The deadline for submitting PPP loan applications is June 30, 2020. There is a limited amount of funds ($349 billion) for the PPP loans, however, so independent exhibitors are encouraged to apply today. Unfortunately, as independent exhibitors and other small businesses prepare to apply for loans under the program, banks have warned of a chaotic launch after the Trump Administration set what they call unrealistic expectations, according to Politico and other media outlets.
ICA urges our members to share their experiences so we can keep apprised of their progress.
CARES Act PPP Resources
The SBA and Treasury Department announced that they have initiated a mobilization effort of banks and other lending institutions to provide small businesses with the capital they need. Beginning on April 3 (in theory) 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.
Changes Small Business Paycheck Protection Loans
Certainly not for the last time, the Trump Administration has altered its guidance on the PPP. In response to complaints from small banks, the federal government issued an interim final rule yesterday that doubled the interest rate under its emergency lending program for small businesses to 1%, up from 0.5%. For an overview of the loan terms, Click Here.
Department of the Treasury
Small Business Administration
SBA Economic Injury Disaster Loans
In addition to the PPP loan program, the SBA is also offering an Economic Injury Disaster Loan (EIDL) to small business owners. Click Here to apply for this low-interest, federal disaster loan directly through the SBA.