No Longer Accepting PPP Applications
UPDATE May 5, 2021 | Green Country FCU is no longer accepting PPP applications as the SBA-backed program has run out of funds. Any applications approved but not yet funded will still be processed. This does not affect PPP loans funded.
Here’s a rundown of several economic relief programs that are available.
Here is a quick rundown of the various pandemic assistance programs available for businesses, including those that provide financial assistance and forgivable loans for entrepreneurs impacted by COVID-19:
- Economic Injury Disaster Loan (EIDL)
- Shuttered Venue Operators Grant (SVOG)
- Restaurant Revitalization Fund (RRF)
- SBA Debt Relief
- Coronavirus Food Assistance Program 2
- COBRA Premium Assistance
Economic Injury Disaster Loan
Also known as EIDL, this is another program overseen by the SBA and provides economic relief for small businesses as well as nonprofits that have suffered from a temporary loss of revenue. The assistance can be used to pay for financial obligations or operating expenses that a business would have been able to cover on its own had the pandemic not occurred.
Like the PPP, this program has been around for a while but has one key difference – it’s not forgivable.
Borrowers can also apply for both the PPP and EIDL, but funds from both are not allowed to be used for the same purpose. Applicants also must be physically located in the United States and have fewer than 500 employees.
The maximum loan amount is $150,000, with loans above $25,000 requiring collateral. The interest rate is 3.75% for businesses and 2.75% for nonprofits, with payment terms up to 30 years.
For more information or to apply for a loan, visit the SBA’s official EIDL website.
Shuttered Venue Operators Grant
Known as SVOG for short, this program was amended by the American Rescue Plan Act and provides more than $16 billion in grants to venues that have been closed due to COVID-19. Of that number $2 billion is set aside for smaller operations with 50 employees or less.
Applicants that qualify for the program will receive grants equal to 45% of their gross revenue. The maximum grant amount for one applicant is $10 million.
Entities that are eligible for the Shuttered Venue Operators Grant include:
- Live venue operators or promoters
- Theatrical producers
- Live performing arts organization operators
- Relevant museum operators, zoos, and aquariums who meet specific criteria
- Motion picture theater operators
- Talent representatives
Note that booking agencies can qualify even if they don’t operate a venue. They can qualify if 70% or more of their annual revenue comes from booking the talent for the venues.
Keep in mind, however, that while it’s possible to receive assistance via the SVOG grant after getting PPP assistance, the reverse is not true.
If you apply for the SVOG, you can no longer apply for the PPP, so it is highly recommended to apply for PPP assistance first.
For more information or to apply, visit the SBA’s official SVOG site.
Restaurant Revitalization Fund
This $26.5 billion fund was established by the American Rescue Plan Act for food and drink establishments. The program, which will be awarded by the SBA, will set aside $5 billion of its funds for smaller businesses with gross revenues of less than $500,000. There will be a cap of $10 million for each business, including $5 million for each physical location of a business operation.
According to the American Rescue Plan Act, businesses that can apply for the Restaurant Revitalization Fund include:
- Food trucks
- Food stands
- Food carts
- Tasting rooms
Publicly-traded companies are ineligible, which is good news for smaller operations that were squeezed out by large chains during the first round of PPP funding.
Funds will be allocated within phases, with businesses that lost a larger percentage of revenue being prioritized first. The RRF will also give higher priority to small businesses run by women, veterans and socially and economically disadvantaged proprietors.
Eligibility for the program is open and broad.
According to the National Restaurant Association, eligible businesses “may receive a tax-free federal grant equal to the amount of its pandemic-related revenue loss, calculated by subtracting its 2020 gross receipts from its 2019 gross receipts.”
If you already received PPP funding, that amount will be deducted from your eligibility for the RRF.
As of early April, an official date has not been announced for program applications but it should be included in the SBA’s main COVID relief operations site once it is available.
SBA Debt Relief
The SBA Debt Relief Program provides financial assistance for borrowers of three types of SBA loans:
As part of the program, the SBA will pay six months of principal, interest, and any associated fees owed by borrowers for such loans that are in “regular servicing status.” The assistance will be automatically provided without needing an application and will apply to loans that were approved up to September 27, 2020.
Coronavirus Food Assistance Program 2
This program is administered by the USDA and was re-launched on April 5 after signups ended on Dec. 11. The program provides financial assistance to farmers, ranchers and other producers to absorb increased costs from market disruptions caused by the pandemic. Assistance is based on the type of commodities grown or raised by farmers and ranchers.
Commodities that are eligible for Coronavirus Food Assistance Program 2 assistance include:
- Specialty crops
- Row crops
- Nursery crops
The launch of CFAP 2 coincides with an increase in payment rates for commodities such as cattle under the original CFAP program.
The USDA also expects to make $4.5 billion in payments to 560,000 producers as part of new CFAP 2 funding that pays $20 in assistance per acre. Total funds for the second round of CFAP 2 funding amounts to about $6 billion. There is a payment limit of $250,000 for each applicant but exceptions also exist for legal entities that have multiple members that provide active labor or personnel management. Examples include cattle operations that are set up as limited liability companies.
If you can prove that each member provided at least 400 hours of active personal labor or management, then you can get $500,000 for two members or $750,000 for three members.
Applications with a focus on CFAP 2 will also be expedited by the USDA for financial assistance under its cooperative programs. Award amounts for the cooperative agreements will range from $20,000 to $99,999 over a time period between six months and one year. Applicants will be notified of their acceptance or denial by June 20 and awards will be in place by Sept. 1.
Sign-ups for CFAP 2 will be open for at least 60 days from April 5. The USDA is also looking into launching a new program such as a potential CFAP 3 to provide targeted assistance for certain types of producers like organic farmers.
For more information or to apply for CFAP 2, visit the USDA’s CFAP 2 website.
The USDA also offers various loan assistance programs for farmers and ranchers. More details on these programs are available at the USDA’s webpage for funding opportunities.
COBRA Premium Assistance
This program provides insurance assistance to employees who lost their coverage and the subsidy will come in the form of a payroll tax credit for employers. As part of the American Rescue Plan Act, the Department of Labor announced on April 7 that the federal government will provide eligible employees who lost their healthcare coverage a 100% subsidy on their COBRA insurance premiums between April 1 and Sept. 30.
For more details, visit the Department of Labor’s COBRA Premium Subsidy web page.
Paycheck Protection Program Application Deadline Extended Through May 31
UPDATE March 26, 2021 | Small businesses scrambling to stay afloat as a result of COVID-19 are getting extra time to apply for low-interest, forgivable loans. Congress extended the deadline for Paycheck Protection Program applications through May 31, 2021. The popular Small Business Administration program was scheduled to sunset Wednesday, a timeline that could have prevented some 190,000 small businesses who have pending PPP applications from securing a loan.
The PPP Extension Act of 2021 also gives the SBA an additional 30 days beyond May 31 to process those loans. The extension was seen by many at the SBA as crucial considering recent eligibility changes and the large number of first-time applicants still seeking help, including the self-employed.
Help cannot arrive fast enough, according to the National Federation of Independent Businesses. Nearly one of every six small business owners report they will have to close their doors if current economic conditions do not improve over the next six months, the NFIB said.