CORONAVIRUS (COVID-19) RESOURCE CENTER

Small businesses are facing unprecedented challenges amid the coronavirus (COVID-19) pandemic. We’ve created this resource hub to help you get the most updated news, information, and advice as you navigate this difficult time.

FEDERAL SMALL BUSINESS RESOURCES

Program Overview

The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll.

SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.

The Paycheck Protection Program will be available through June 30, 2020.

Who Can Apply

This program is for any small business with less than 500 employees (including sole proprietorships, independent contractors and self-employed persons), private non-profit organization or 501(c)(19) veterans organizations affected by coronavirus/COVID-19.

Businesses in certain industries may have more than 500 employees if they meet the SBA’s size standards for those industries.

Small businesses in the hospitality and food industry with more than one location could also be eligible at the store and location level if the store employs less than 500 workers. This means each store location could be eligible.

How to Apply

You can apply through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union,  and Farm Credit System institution that is participating. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program. You should consult with your local lender as to whether it is participating in the program.

Lenders may begin processing loan applications as soon as April 3, 2020.

Loan Details and Forgiveness

The loan will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent, and utilities (due to likely high subscription, at least 75% of the forgiven amount must have been used for payroll). Loan payments will also be deferred for six months. No collateral or personal guarantees are required. Neither the government nor lenders will charge small businesses any fees.

Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels.  Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease.

This loan has a maturity of 2 years and an interest rate of .5%.

If you wish to begin preparing your application, you can download a sample form to see the information that will be requested from you.

To apply for a COVID-19 Economic Injury Disaster Loan, click here.

In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000.

The SBA’s Economic Injury Disaster Loan program provides small businesses with working capital loans of up to $2 million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing. The loan advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue. Funds will be made available within three days of a successful application, and this loan advance will not have to be repaid.

How to apply: COVID-19 ECONOMIC INJURY DISASTER LOAN APPLICATION

EMERGENCY PAID SICK LEAVE

Businesses with under 500 employees are required to provide emergency paid sick leave. During COVID-19, employees can use emergency paid sick leave if they are:

  1. observing a federal, state or local isolation/quarantine order
  2. advised by a healthcare provider to self-quarantine
  3. experiencing symptoms and seeking medical care
  4. caring for a family member under a federal/state/local order or medical recommendation to quarantine/isolate
  5. caring for a child whose school or daycare has been closed
  6. experiencing any other substantially similar conditions specified by the Secretary of Health and Human Services

Emergency paid sick leave becomes effective on April 1, 2020 and there is no waiting period for new employees to use it.

Employees taking leave to care for or isolate themselves (i.e. reasons 1, 2, or 3 above) are entitled to 100% of their regular wages up to $511/day

Employees taking leave to care for a family member (i.e. reasons 4, 5, or 6 above) get two thirds of their regular wages up to $200/day.

Full-time employees can take up to 80 hours of leave, whether caring for themselves or for others. Part-time employees can take up to the average number of hours they would work over a two-week period. Employees who make more than the limits listed above can be paid their full wages if the employer is able to cover these costs, but employers will only receive a tax credit up to those limits

If your employees take emergency paid sick leave, you can receive a tax credit up to the limits listed above to cover the wages you paid them. This credit covers 80 hours of paid sick leave for full-time employees, or the average number of hours worked over a two-week period for part-time employees.

The credit will be applied to an employer’s Social Security taxes (this reduces the federal tax payments Gusto makes on your behalf).

  • For time an employee takes to care for or isolate themselves, the credit is capped at $511 per day and $5,110 total per employee.
  • For time an employee takes to care for a family member, the credit is capped at $200 per day and $2,000 total per employee.

Employers are required to grant emergency paid sick leave due to COVID-19 starting April 1, 2020.

Contact your payroll service provider for guidance.

EMERGENCY FMLA

Emergency family and medical leave of absence (FMLA) is an amendment to existing FMLA regulations to help employees during COVID-19.

Under the amended FMLA, businesses with under 500 employees are required to provide job protected emergency FMLA leave for employees. Businesses with under 50 employees may be exempted by the Department of Labor from these requirements if the DOL decides that they would jeopardize their business.

Emergency FMLA can be used by employees who are unable to work (or work remotely) while caring for a child under 18 because the child’s school/daycare is closed or unavailable due to the COVID-19 public health emergency.

First 10 days are unpaid

New employees qualify for emergency FMLA coverage after 30 days of employment. The first 10 working days taken off are unpaid. They may be covered with accrued paid time off, sick leave, or emergency paid sick leave.

Employees receive two thirds of pay after 10 days unpaid

After the first 10 days, employers must pay employees two thirds of their normal rate of pay up to $200 per day or the aggregate of $10,000. For employees with varying work hours, take the average number of hours they were scheduled to work in the six months prior to the start of their leave (or if a recent hire, then the reasonable average hours expected at the time of hire).

Employees who make more than the amounts listed above can be paid their full wages if the employer is able to cover these costs, but employers will only receive a tax credit up to those amounts.

As with traditional FMLA leave, this leave is job protected and employees are generally entitled to return to their same or equivalent position. However, employers with less than 25 employees are exempt from this requirement if they can show that the position no longer exists due to economic conditions caused by COVID-19, and the employer took reasonable efforts to restore the employee to an equivalent position with equivalent compensation and benefits.

Businesses can receive tax credit for wages paid towards this benefit up to $200 per day and $10,000 total per employee over the course of the COVID-19 pandemic. Credit is applied to an employer’s Social Security taxes (this reduces the federal tax payments Gusto makes on your behalf). Credit amounts that exceed social security liabilities will be refunded after the quarter ends.

Employers are required to grant emergency FMLA leave due to COVID-19 starting April 1, 2020.

Contact your payroll service provider for guidance

ADDITIONAL GUIDANCE & RESOURCES

The SBA Debt Relief program will provide a reprieve to small businesses as they overcome the challenges created by this health crisis.

Under this program:

  • The SBA will also pay the principal and interest of new 7(a) loans issued prior to September 27, 2020.
  • The SBA will pay the principal and interest of current 7(a) loans for a period of six months.

Express Bridge Loan Pilot Program allows small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 with less paperwork. These loans can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing and can be a term loans or used to bridge the gap while applying for a direct SBA Economic Injury Disaster loan. If a small business has an urgent need for cash while waiting for decision and disbursement on Economic Injury Disaster Loan, they may qualify for an SBA Express Disaster Bridge Loan.

Terms

  • Up to $25,000
  • Fast turnaround
  • Will be repaid in full or in part by proceeds from the EIDL loan

Find an Express Bridge Loan Lender by connecting with your local SBA District Office.

The President’s Coronavirus Guidelines for America – 15 Days to Slow the Spread

The Centers for Disease Control and Prevention (CDC) offers the most up-to-date information on COVID-19. This interim guidance is based on what is currently known about the coronavirus disease 2019 (COVID-19). For updates from CDC, please see the following:

The following interim guidance may help prevent workplace exposures to acute respiratory illnesses, including COVID-19, in non-healthcare settings. The guidance also provides planning considerations if there are more widespread, community outbreaks of COVID-19.

To prevent stigma and discrimination in the workplace, use the guidance described below and on the CDC’s Guidance for Businesses and Employers web page.

Below are recommended strategies for employers to use now. In-depth guidance is available on the CDC’s Guidance for Businesses and Employers web page:

  • Actively encourage sick employees to stay home
  • Separate sick employees
  • Emphasize staying home when sick, respiratory etiquette and hand hygiene by all employees
  • Perform routine environmental cleaning
  • Advise employees before traveling to take certain steps
    • Check the CDC’s Traveler’s Health Notices for the latest guidance and recommendations for each country to which you will travel. Specific travel information for travelers going to and returning from designated countries with risk of community spread of Coronavirus, and information for aircrew, can be found on the CDC website.
  • Additional Measures in Response to Currently Occurring Sporadic Importations of the COVID-19:
    • Employees who are well but who have a sick family member at home with COVID-19 should notify their supervisor and refer to CDC guidance for how to conduct a risk assessment of their potential exposure.
    • If an employee is confirmed to have COVID-19, employers should inform fellow employees of their possible exposure to COVID-19 in the workplace but maintain confidentiality as required by the Americans with Disabilities Act (ADA). Employees exposed to a co-worker with confirmed COVID-19 should refer to CDC guidance for how to conduct a risk assessment of their potential exposure.

Common Issues Small Businesses May Encounter:

  • Capital Access – Incidents can strain a small business’s financial capacity to make payroll, maintain inventory and respond to market fluctuations (both sudden drops and surges in demand). Businesses should prepare by exploring and testing their capital access options so they have what they need when they need it.  See SBA’s capital access resources.
  • Workforce Capacity – Incidents have just as much impact on your workers as they do your clientele. It’s critical to ensure they have the ability to fulfill their duties while protected.
  • Inventory and Supply Chain Shortfalls – While the possibility could be remote, it is a prudent preparedness measure to ensure you have either adequate supplies of inventory for a sustained period and/or diversify your distributor sources in the event one supplier cannot meet an order request.
  • Facility Remediation/Clean-up Costs – Depending on the incident, there may be a need to enhance the protection of customers and staff by increasing the frequency and intensity by which your business conducts cleaning of surfaces frequently touched by occupants and visitors. Check your maintenance contracts and supplies of cleaning materials to ensure they can meet increases in demand.
  • Insurance Coverage Issues – Many businesses have business interruption insurance; Now is the time to contact your insurance agent to review your policy to understand precisely what you are and are not covered for in the event of an extended incident.
  • Changing Market Demand – Depending on the incident, there may be access controls or movement restrictions established which can impede your customers from reaching your business. Additionally, there may be public concerns about public exposure to an incident and they may decide not to go to your business out of concern of exposing themselves to greater risk. SBA’s Resources Partners and District Offices have trained experts who can help you craft a plan specific to your situation to help navigate any rapid changes in demand.
  • Marketing – It’s critical to communicate openly with your customers about the status of your operations, what protective measures you’ve implemented, and how they (as customers) will be protected when they visit your business. Promotions may also help incentivize customers who may be reluctant to patronize your business.
  • Plan – As a business, bring your staff together and prepare a plan for what you will do if the incident worsens or improves. It’s also helpful to conduct a tabletop exercise to simulate potential scenarios and how your business management and staff might respond to the hypothetical scenario in the exercise. For examples of tabletop exercises, visit FEMA’s website at: https://www.fema.gov/emergency-planning-exercises

SBA provides a number of loan resources for small businesses to utilize when operating their business. For more information on loans or how to connect with a lender, visit: https://www.sba.gov/funding-programs/loans.

  • 7(a) program offers loan amounts up to $5,000,000 and is an all-inclusive loan program deployed by lending partners for eligible small businesses within the U.S. States and its territories. The uses of proceeds include: working capital; expansion/renovation; new construction; purchase of land or buildings; purchase of equipment, fixtures; lease-hold improvements; refinancing debt for compelling reasons; seasonal line of credit; inventory; or starting a business.
  • Express loan program provides loans up to $350,000 for no more than 7 years with an option to revolve. There is a turnaround time of 36 hours for approval or denial of a completed application. The uses of proceeds are the same as the standard 7(a) loan.
  • Community Advantage loan pilot program allows mission-based lenders to assist small businesses in underserved markets with a maximum loan size of $250,000. The uses of proceeds are the same as the standard 7(a) loan.
  • 504 loan program is designed to foster economic development and job creation and/or retention. The eligible use of proceeds is limited to the acquisition or eligible refinance of fixed assets.
  • Microloan program involves making loans through nonprofit lending organizations to underserved markets. Authorized use of loan proceeds includes working capital, supplies, machinery & equipment, and fixtures (does not include real estate). The maximum loan amount is $50,000 with the average loan size of $14,000.

SBA is focused on assisting with the continuity of operations for small business contracting programs and small businesses with federal contracts. For more information on federal contracting, visit https://www.sba.gov/federal-contracting/contracting-guide

More specifically:

  • 8(a) Business Development program serves to help provide a level playing field for small businesses owned by socially and economically disadvantaged people or entities, and the government limits competition for certain contracts to businesses that participate. The 8(a) program offer and acceptance process is available nationwide, and the SBA continues to work with federal agencies to ensure maximum practicable opportunity to small businesses. 8(a) program participants should stay in touch with their Business Opportunity Specialist (BOS).
  • HUBZone program offers eligibility assistance every Thursday from 2:00-3:00 p.m. ET at 1-202-765-1264; access code 63068189#.  Members of the HUBZone team answer questions to help firms navigate the certification process.  For specific questions regarding an application, please contact the HUBZone Help Desk at hubzone@sba.gov.
  • Women-owned Small Business firms who have questions, please visit www.sba.gov/wosbready or write to wosb@sba.gov.

If a situation occurs that will prevent small businesses with government contracts from successfully performing their contract, they should reach out to their contracting officer and seek to obtain extensions before they receive cure notices or threats of termination. The SBA’s Procurement Center Representatives can assist affected small businesses to engage with their contracting officer. Use the Procurement Center Representative Directory to connect with the representative nearest you.