USCC: Coronavirus Emergency Loans Small Business Guide and Checklist
The Coronavirus Aid, Relief, and Economic Security (CARES) Act allocated $350 billion to help small businesses keep workers employed amid the pandemic and economic downturn. Known as the Paycheck Protection Program, the initiative provides 100% federally guaranteed loans to small businesses who maintain their payroll during this emergency. Importantly, these loans may be forgiven if borrowers maintain their payrolls during the crisis or restore their payrolls afterward.
Over the weekend, the federal government put into action a $2 trillion stimulus bill to aid the economy given the impact of the COVID-19 pandemic known as the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act. Title one, the Keeping American Workers Paid and Employed, provides relief for small businesses and their employees adversely impacted by COVID-19.
The cornerstone is the Paycheck Protection Program – an emergency lending program administered by the Small Business Administration. At $349 billion in new lending capacity, it will provide loans to borrowers at this time of economic uncertainty. The fund, which accounts for the vast majority of the small business assistance provided in the legislation, is intended to accomplish two fundamental goals:
·Help small businesses cover their near-term operating expenses during the worst of the crisis
·Provide a strong incentive for employers to retain their employees.
HOW DOES IT WORK?
In short, it is intended as a partial revenue replacement program to allow deeply affected businesses to hibernate through a period of severe disruption without making drastic changes to their footprint.
·It targets businesses, 501(c)(3) nonprofits, tribal businesses, and veteran organizations with 500 employees or less as eligible for federally-insured, partially-forgivable loans to cover short-term operating expenses during the economic crisis.
·The maximum loan is equivalent to 250 percent of the employer’s average monthly payroll costs or $10 million, whichever is less. Payroll costs are defined broadly to include wages, salaries, retirement contributions, healthcare benefits, covered leave, and other expenses.
·The program includes a number of generous features for borrowers, including six to 12 months of deferred repayment, fee waivers, and streamlined application requirements.
·Borrowers are eligible for loan forgiveness equivalent to the sum spent on covered expenses during the eight-week period after the loan is originated. Covered expenses include: the bulk of a typical business’ fixed operating costs such as payroll, rent, utilities, and mortgage interest obligations. However, to qualify for forgiveness, employers must maintain their pre-crisis level of full-time equivalent employees or face a reduction in forgiveness proportional to the reduction in headcount. Since many businesses have already been forced to make staffing reductions in response to vanishing customers and lost revenues, the legislation includes a clause that allows them to qualify for loan forgiveness if they have re-hired back to pre-crisis levels by June 30, 2020.
Congress made the terms generous and the barriers to entry low in an effort to ensure resources would be made available as quickly as possible. Borrowers do not need to demonstrate actual economic harm in order to qualify. Instead, they simply need to make a series of good faith certifications, principally that current economic conditions necessitate the loan to support ongoing business operations, and that the funds will be used to maintain payroll and address other covered expenses.
While this streamlined approach will certainly make it easier for vulnerable businesses to receive support on an expedited basis, it may also lead some otherwise healthy businesses to take advantage of the program at the expense of those whose survival depends upon it.
Free Webinar: New Federal Employment Act
Thursday, April 2 from 10 to 11 AM
Join us to learn about the new federal coronavirus employment act, including the Emergency Sick Leave Law, the Emergency FMLA Amendment, and the Payroll Protection Act.
Employers with under 500 employees may receive a refundable credit for up to 80 hours of sick leave paid to employees under the Emergency Paid Sick Leave Act and a refundable child care leave credit for up to 10 weeks under the Emergency FMLA Expansion Act. Under the Payroll Act the SBA will pay off loans for up to 8 weeks for payrolls.
Attorney D. Moschos, Labor and Employment, Mirick O'Connell
Attorney Kimberly Rozak, Labor and Employment, Mirick O’Connell
The news is full of reports of the shortages of personal protective equipment (PPE) for dealing with the COVID-19 pandemic. According to the World Health Organization, industry and government have called on to increase manufacturing of these products by 40% to meet the rising global demand.
Massachusetts has an immediate need for N95 respirators in particular, and MassMEP can help direct companies who have the capability of helping. Contact Tom Andrellos, MassMEP Director of Growth Services, email@example.com.
Crowdsourcing has also been active in working to meet the demand for PPE. As part of the innovative responses to assist in solving the demand issue, a maker community at OSCMS has prepared an open source compendium of manufacturing blueprints and specs for many of the critical items on state and hospital critical? needs lists. Click here to view the document.
Safety and liability is a serious issue and must be mentioned, and is so in the OSCMS document: There are engineering and manufacturing risks around medical devices. Though the FDA has issued Emergency Use Authorizations (EUA) (Coronavirus Disease 2019 (COVID-19) Emergency Use Authorizations for Medical Devices, FDA), to avoid doing more harm than good, it is recommended to attempt to the best of your ability and circumstances to follow regulations, which may seem cumbersome, but exist for good reason.
Regulatory standards that apply to the supplies and devices in question:
MA Attorney General issues FAQ’s on COVID-19 Employee Rights and Employer Obligations
The Attorney General’s Fair Labor Division has issued the following guidance on employee rights and employer obligations under state and federal law during the current COVID-19 restrictions. Click here to learn more about the interplay of the recently adopted Family First Coronavirus Response Act and Massachusetts employment law, including unemployment and earned sick time benefits, layoff implications, payment of wages during shut downs, and restricting employee hours.
Free Updates on all Mass. COVID-19 Legislation
All 66 (and counting) Massachusetts COVID-19 bills, summarized in plain English by the MassTrac Legal Division,are now available to the public at no charge via our blog, located at blog.instatrac.com.
Click through any bill to view all related information on it (press releases, news articles, more).
SCORE info COVID update
?SCORE has suspended all in-person meetings but we continue to work with clients via phone, email, and ZOOM.
If people already have a relationship with a SCORE mentor they should reach out to them directly via email or phone. No one has managed through a situation even remotely like this but sometimes we come up with creative solutions just asking each other questions.
To find a SCORE mentor go to the SCORE.org national website and click the “Find a Mentor” box. We’ll contact you normally within 1-2 days. Also at the website use the search feature to find information and experts on specific topics like “military contracting” or “sick leave”. You can also take a workshop and browse the library.
Everything we do is FREE and CONFIDENTIAL!
Central Massachuetts Regional Planning Commission
Business Impact Survey
If you are a business owner, community leader, or municipal economic development committee in Southern Worcester County and are looking for help navigating the many State, Federal or Local resources that have been rolled out in response to the Covid-19 outbreak, please contact Kerrie Salwa, firstname.lastname@example.org for direction to these resources. If you are a current business owner: Please access the survey using the link below so we have a better idea of the needs of our region. Thank you.
We at the Worcester Regional Chamber of Commerce and Discover Central Mass are concerned about our businesses and organizations as we are all navigating uncharted waters in response to the COVID-19 pandemic.
Our goal with this questionnaire is to better understand your business needs so that we can properly advocate on your behalf to federal, state, and local officials. We are communicating regularly with these leaders as we seek to craft solutions that will assist businesses, save jobs, and help those who have been adversely impacted by this crisis – from both a health and economic perspective.
Please take a few minutes to let us know how best we can support you.
Effective Date for Employment Tax Credits Under the Families First Coronavirus Response Act
This notice provides that the tax credits for qualified sick leave wages and qualified family leave wages required to be paid by the Families First Coronavirus Response Act will apply to wages paid for the period beginning on April 1, 2020, and ending on December 31, 2020. This notice also provides that days occurring during the period beginning on April 1, 2020, and ending on December 31, 2020, will be taken into account for credits for qualified sick leave equivalent amounts and qualified family leave equivalent amounts for certain self-employed individuals.
Please visit SBA.gov/MA for up to date information on loan packages from emergency guaranteed loans up to 10 million dollars and emergency bridge loans $25,000.00 or less. Some include payment deferments are up to 12 months.
An Important Request from Milford Regional Medical Center Remains
We are seeking out donations from businesses concerning medical supplies, especially masks and PPE. I’m sure you are aware of the shortages. We have appreciated the response from our community so far, but the need is great, supply is short, and we need your help.
Milford Regional Medical Center truly appreciates any help you can give us.
To Our Blackstone Valley Manufacturers:
Critical Need for PPE (Personal Protection Equipment)
Are you able to help?
As many of you may already be aware, the State Senate has reached out to request assistance in procurement and production of critical need medical personal protection equipment, including masks, gloves, gowns, and eye protection. There is also a very critical shortage of ventilator equipment, urgent need to adapt the current equipment, including ventilators to work with more than one patient and to produce large numbers.
These critical needs have been identified as the Covid-19 crisis is beginning to accelerate in Massachusetts. The national strategic supplies have only been able to deliver to states about 10% of requests. Two Boston hospitals already have nearly 100 staff (each) on quarantine from exposures to individuals carrying the virus. The CDC has revised criteria to allow a wide variety of respirators along with less protective masks to be used in medical care.
Would you reach out to contacts in your circle who may have production capacity, stores that could be shared, or technical knowledge and skills that could assist.
As a reminder, the BVCC Office is closed to in person meetings this week, but please do not hesitate to contact the staff of the Blackstone Valley Chamber of Commerce. We are here to ensure your questions get answered, and your business needs are met.