The current Covid-19 response and its effects on the economy will no doubt be challenging to everyone. None more than small business and their employees, but we have been here before. Just as we weathered 9/11, hurricanes, and severe economic downturns we can work together to survive this.
The good news is that this will be temporary. Although it may be very trying, the economy should rebound rather quickly once activities normalize. Realizing this could take several weeks to several months, the best bet is to implement a strategy TODAY!
Our Transworld Business Advisors team is working hard to ensure businesses have access to a range of resources to help them navigate this challenging time. Below you will find information on services to assist Colorado business owners with disaster loan applications, long-term planning, and general business preparedness through the COVID-19 business crisis. Transworld will work hard to keep this page up to date with real information as new programs and information becomes available for Colorado business owners and the evolving business environment.
START HERE. This is a full guide provided by the US Senate committee for small business and entrepreneurship. An additional $310 billion has been funded into the PPP program and $60 billion into the EIDL Disaster Program.
- Additional overview from SBA on all programs
SBA Disaster Loan Assistance (EIDL). Update EIDL loans only now apply to agricultural businesses. If you already have an application in it will still be processed on a first-come, first-serve basis (so they say). They are recommending that if you have applicant # in the 2000 series you should reactive their applications now that the portal has reopened for Agriculture. Even though the EIDL App Portal Opening will be for NEW ag business applicants only if you have a 2000 series # it will still be processed.
This information was received directly from the SBDC, if you have questions please reach out to your local office.
Payroll Protection Program. Here is also a good overview of the loans as provided by the US Chamber of Commerce. Try to avoid the noise, get information about these loans straight from the horse's mouth: lenders, your banker, and government officials.
- Recent update: the expenses that you use to cover the forgivable portion of PPP are not tax deductible.
New, Expanded SBA Program: Main Street Loans. Main Street Loans can be a solution for larger businesses that did well in 2019. They can be used for growth and expansion capital. The minimum loan size is $500,000 and they cap at $25 million. Rates are low (2-4%) but repayments are tough. Loan term is 4 years, with the first year's payment waived but then 33.33% of the loan value has to be repaid for each of the remaining three years. Multifunding is the only firm I have seen so far working on these.
Other SBA Programs: 7a, Express, 504 Loans. These programs are still running as they have been, although interest rates may have dropped. We do not expect any of the other programs to affect business acquisition loan processing, but we do expect longer than usual processing times (60-90 days minimum). If you are thinking about growing your business, buying a business or buying a property these programs are still in place and working efficiently.
Denver Small Business Emergency Fund, closed.
Verizon Small Business Grant Program, closed.
Google Grants, will be automatically added to Google Adwords customer accounts.
We expect more relief and grant programs to be provided by states and cities within the coming weeks.
SBA Debt Relief
- For anyone that has an active OR NEW SBA loan (7a, 504, microloans not including PPP and disaster loans) the SBA will cover all loan payments including principal, interest, and fees for six months. Your lender should automatically stop drawing your payment beginning April 1, but it is worth checking. For new loans, you must have the loan activated before September 27, 2020. The six months payment waivers will be from the loan date.
SBDC Consulting Services
- Please be aware of a flood of people and vendors that are offering to navigate these loans for you, there are a TON of scam operations.
- The SBDC offices have consultants that are free and ready to help with loan applications and navigating these programs.
- Make sure you are only dealing with legitimate sources: certified lenders or government agencies and partners like the SBA or SBDC.
Many business owners have never had to manage an evolving economic environment like we're experiencing now. Download our survival guide to learn about how you can position your business to maximize its health during times a big change.
HR 6201 - Families First Coronavirus Response Act (PASSED). This bill guarantees free coronavirus testing and grants 14 days of paid sick leave for people affected by the coronavirus for all full-time employees at companies with fewer than 500 employees. Companies of less than 50 employees will be reimbursed for providing the 14 days of leave, although how and when is unclear.
S 3548 CARES Act (In Senate Debate). (PASSED) This bill has rolled a number of COVID-19 relief plans together and includes EIDL loans, Payroll Protection Program loans and debt relief for current SBA loans.
HR 266. (PASSED) Increased funding for PPP and EIDL programs.