Yesterday, Congress enacted a new bill, which President Trump signed earlier today, adding over $350 billion in aid for small business owners impacted by the COVID-19 pandemic. The bill replenishes exhausted funds originally provided to benefit small businesses under the CARES Act’s Paycheck Protection Program (PPP) and the Emergency Injury Disaster Loans, including Emergency Grants (EIDLs). Funds may be available as early as Monday. See our previous e-alert detailing the PPP and EIDLs here.
The PPP provides forgivable loans to small businesses for payroll, rent, and other eligible costs. Last week, the $349 billion allocated to the PPP ran out of funding. Out of the $310 billion PPP appropriation, the new bill sets aside $60 billion for small and community based lenders in order to foster access to women and minority owned businesses, in addition to the small businesses that typically do not have existing lending relationships. Applicants who have applied for, but did not yet receive funds, should follow-up directly with their lenders to confirm their position in the queue. New applicants should prepare required documentation and contact their lender, as the program continues to be first-come first-served.
The new bill will also add $60 billion to the depleted EIDL program, with $10 billion of that reserved for Emergency Grants. The application is available here. EIDLs are payable over 30 years and have an interest rate of 3.75% for profit businesses, or 2.75% for non-profits. EIDLs may be used for fixed debts, payroll, accounts payable and other bills that cannot be paid due to the pandemic.
Banks are prepared for the second round of funding and business owners should be prompt and thorough with their applications. If you would like guidance with any of the loans or programs under the CARES Act, please contact any of our team members below:
Thomas R. Candrick, Jr.
(203) 784-3103; [email protected]
(203) 575-2621; [email protected]
Matthew H. Gaul
(203) 784-3106; [email protected]
Joseph L. Kinsella
(203) 575-2645; [email protected]
Mark J. Malaspina
(203) 575-2625; [email protected]
Ann H. Zucker
(203) 252-2652; [email protected]
Wesley D. Cain
(203) 784-3105; [email protected]
Stephanie E. Cummings
(203) 575-2649; [email protected]
Kevin G. Palumberi
(203) 252-2692; [email protected]
Holly G. Wheeler
(203) 784-3158; [email protected]