During an almost hourlong webinar Thursday, U.S. Rep. Sean Casten, D-Downers Grove, and Robert “Bo” Steiner, district director of the U.S. Small Business Association, shared tips for small-business owners and entrepreneurs who may be experiencing financial hardships amid the COVID-19 pandemic.
Casten and Steiner presented a trio of federal loans programs that could offer some support for small-business owners to sustain their services and staff.
The first is the $349 billion Protection Paycheck Program, which was created under the Coronavirus Aid, Relief and Economic Security Act. The purpose is simple: “It’s to make sure that we can continue to have businesses viable and have people employed,” said Casten, who represents the 6th Congressional District.
So, who’s eligible?
Small businesses with fewer than 500 employees, which includes sole proprietorships, self-employed workers and independent contractors; private nonprofit organizations; and 501(c)(19) veterans organizations can apply for the PPP. Hospitality-focused businesses, as well as other companies in the food industry, also are a fit for the program, Steiner said.
It is common with those types of businesses to have more than one location, meaning each store location could be eligible under this program, he said.
Recipients of the PPP can qualify for a loan up to $10 million, and those funds – which will be rolled out in eight weeks – are intended for payroll costs, interest on mortgages, rent, utilities or any debts incurred before February, Steiner said.
What’s more, Casten said, is that this is a forgivable loan, provided that at least 75% of it was used for payroll. Lenders were allowed to process the applications as early as April 3, and the program will be available until
“It’s very heavily tailored not to your credit risk, not your ability to repay, but your payroll,” Casten said.
The SBA Debt Relief and the SBA Express Lender are up next. Under the debt relief plan, the SBA has proposed to automatically pay the principal, interest and fees of current 7(a), 504 and microloans for six months. The SBA also will take care of new 7(a), 504 and microloans issued before Sept. 27.
Steiner said this is a subsidy program that caters to businesses that already have loans approved by the SBA, and funding from the U.S. Treasury will be used here.
As for the express lender, small businesses that have a preexisting relationship with an SBA Express Lender can access $25,000 quickly. This is meant to “help you bridge the gap,” Steiner said.
He also said the program is for businesses that may have lost revenue, are in need of immediate financial assistance or currently are waiting for a decision and disbursement of the Economic Injury Disaster Loan.
“Thank you all for all of your collective sacrifices,” Casten said, ending the presentation. “It is a collective public health crisis. It is a collective economic crisis, and we are going to get through it collectively. I think we all appreciate how many shoulders we’re all leaning on right now. Thank you for being the shoulder. Thank you for leaning on the shoulder.”