Category: FOR SMALL BUSINESSES

Small Business COVID-19 Relief Grant Program

As the First Round Ends, the Second Application Round BEGINS on February 2nd, 2021!

Funding will support small businesses that have struggled due to the COVID-19 pandemic

Sacramento, CA – California’s Office of the Small Business Advocate (CalOSBA), part of the Governor’s Office of Business and Economic Development (GO-Biz), today announced that Round 1 for the Small Business COVID-19 Relief Grant Program has closed. 

With more than 300,000 applications successfully completed, application approval notifications will be sent out Friday, January 15 through Friday, January 22. Funds will be disbursed over a 45-day verification period beginning Friday, January 22.

A second round of applications will open at 8:00 a.m. February 2 and will run through 6:00 p.m. February 8. Applicants who submitted all necessary documents in the first round and met eligibility requirements, but did not receive a grant, do not need to reapply; their applications will be rolled over for consideration in the second round. 

“There is no question that small business are hurting, and the reality of this pandemic demands urgent relief now to help those who need it most,” said Dee Dee Myers, GO-Biz Director. “Before COVID-19, the 4.1 million small businesses that call this state home created two-thirds of California’s net new jobs and employed nearly half of all private-sector employees. It is crucial that we do everything we can to put more money into the hands of impacted small business owners.”

On January 5, Governor Newsom previewed his Equitable Recovery for California’s Businesses and Jobs plan – part of his proposed 2021-22 state budget – which called for immediate legislative action on $575 million in additional grants for the California Relief Grant Program. This investment will add to the initial $500 million allocation announced November 30, bringing the total amount for the Small Business COVID-19 Relief Grant Program to $1.075 billion.

The Small Business COVID-19 Relief Grant Program offers grants up to $25,000 to micro and small businesses and nonprofits that have been impacted by the pandemic. It is not a first-come, first-served program, nor a rolling approval process. Grants will be distributed across the state, with priority given to regions and industries impacted by the COVID-19 pandemic, disadvantaged communities and underserved small business groups. All applications will be considered and prioritized based on impact.

Due to the overwhelming demand, the Round 1 application deadline was extended from January 8 to January 13 to ensure interested small businesses and nonprofits had the opportunity to apply.

Mission-based lenders and small business advisory and technical assistance providers will continue to help small businesses with the application process in multiple languages and formats in the second round. Many of the State-supported small business centers, which prioritize the expansion of technical assistance to underserved business groups, will also be also available to help. For more information on grant requirements and eligibility, please visit CAReliefGrant.com.

Paycheck Protection Program – Round 2

After months of waiting for much-needed relief, small businesses are finally getting renewed support from the federal government. The new stimulus package approved by Congress comprises $900 billion in virus relief funds, including $284.5 billion to reopen and strengthen the Paycheck Protection Program (PPP) for first time and second time borrowers. Please note that you can apply for either a first or second draw offering two and a half times your payroll and for self-employed people with no employees you can just use your 2019 Schedule C earnings. 

With the changes, borrowers can now qualify for up to $10 million ($2 million for repeat borrowers). 

How and When to Apply:

You can apply NOW through March 31, 2021! Applications are attached.

SBA is currently accepting First and Second Draw PPP loan applications from participating lenders. Applications will first become available through community financial institutions, a subset of banks and other lenders who meet special criteria, with larger financial institutions soon to follow. PPP loans carry an interest rate of 1% and can be fully forgiven—principal and interest—if spending requirements are met. Consult your bank to find out about their application Process.

The First-Time Borrowers & Second Draw Applications are both attached.

PPP Forgivable Loans are Available to First-Time Borrowers from the Following Groups:

1.      Businesses with 500 or fewer employees that are eligible for other SBA 7(a) loans.

2.      Sole proprietors

3.      Independent contractors

4.      Eligible self-employed individuals

5.      Non-profits, including churches.

6.      Accommodation and food services operations with fewer than 300 employees per physical location.

To receive a PPP second draw loan, eligible entities must:

1.      Have previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses.

2.      Employ no more than 300 employees (as opposed to 500 employees in the first round of PPP).

3.      Demonstrate at least a 25% reduction in gross receipts in the first, second, or third quarter of 2020 relative to the same quarter in 2019.

For Assistance with Finding a Lender:

1.       Divvy/Lendio have already begun accepting applications.

2.       Lender Match

3.       View all lenders near you on a MAP.   

4.       For BERKELEY Businesses, check with Berkeley OED.

Additionally, you can also see the 82-page interim final rules (IFRs) for first-time borrowers or the 42-page IFR guidelines for businesses that previously received a PPP loan issued this week by the U.S. Small Business Administration (SBA) and Treasury. All Second Draw PPP Loans will have the same terms regardless of lender or borrower.

There are limitations on the amount of money a business can borrow under the program. The specific amount each business is eligible for is calculated based on its payroll expenses, with food and hospitality businesses qualifying for additional funds, but the maximum loan amount for first-time borrowers is set at $10 million.

Just like during the first rendition of the program, 60% of the loan amount must go toward payroll. But this time around, the categories of eligible expenses for the remaining 40% have been expanded to include worker protections such as personal protective equipment, damages from looting or vandalism that took place in 2020, and professional services like cloud.

SBA & PROTECTION PROGRAM LOAN PROCESS BROKEN DOWN

SBA Economic Injury Disaster Relief Loans (EIDLs)

  • Applicants may apply by visiting the SBA’s secure access site at: https://disasterloan.sba.gov/apply-for-disaster-loan/index.html  Note: you may experience instability with the website due to high volume, so you may want to try the email address listed below.
  • Disaster loan information and application forms may also be obtained by calling the SBA’s Customer Service Center at (800) 659-2955 ((800) 877-8339 for the deaf and hard-of-hearing) or by sending an email to: disastercustomerservice@sba.gov

Program Terms (as of March 26, 2020):

  • Maximum Borrowing Amount:  $2,000,000
  • Use of Funds:  Pay fixed debts, payroll, accounts payable and other expenses that could have been paid had the disaster not occurred.  
  • Rate:  3.75% for Businesses and 2.75% for Non-Profits
  • Term:  Up to 30 years based on the ability of the borrower to repay
  • Collateral:  SBA will not decline a loan for lack of collateral, but requires borrowers to pledge what is available, including real estate. This collateral requirement may be waived with legislation under discussion in Congress.
  • Stated Timeline for Approval:  2-3 weeks
  • Applicant is physically located in a declared disaster county and suffered working capital losses due to the declared disaster, not due to a downturn in the economy or other reasons

Must be a small business as defined by the SBA — generally fewer than 500 employees or size standards established for specific industries, any individual who operates as a sole proprietor, or as an independent contractor.

If you have any questions about this type of disaster relief loan, they have a 24/7 call center that can be reached at 1-800-659-295. I have already called them myself today and was able to get through to a live person within 10 minutes.

SBA Loan – Small Businesses *New Advance of up to $10,000 *added April 15th

On March 29, 2020, following the passage of the CARES Act, the SBA provided small business owners and non-profits impacted by COVID-19 with the opportunity to obtain up to a $10,000 Advance on their Economic Injury Disaster Loan (EIDL). The Advance is available as part of the full EIDL application and will be transferred into the account you provide shortly after your application is submitted. To ensure that the greatest number of applicants can receive assistance during this challenging time, the amount of your Advance will be determined by the number of your pre-disaster (i.e., as of January 31, 2020) employees. The Advance will provide $1,000 per employee up to a maximum of $10,000.

Another type of loan that the SBA is offering is the Paycheck Protection Program

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: 

  • Any small business with less than 500 employees (including sole proprietorships, independent contractors and self-employed persons)
  • Private non-profit organization 
  • 501(c)(19) veterans organizations affected by coronavirus/COVID-19.

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. Here’s the link to the list of venders, by state: https://www.sba.gov/partners/lenders/microloan-program/list-lenders. 

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. The sample form is attached.

In addition to being a small business owner, if you are do not own your home as your primary residence, there are also other resources to assist renters at this time, specific to the city you live and rent in. 

City Of Berkeley – Small Business Continuity Grants APPLY NOW!

“The City of Berkeley has launched an emergency relief fund with an allocation of $1 million to help mitigate COVID-19 related financial losses that Berkeley’s small businesses have suffered. Through this program the City is making grants of up to $10,000 available to Berkeley-based small businesses and nonprofits to enable continuity through and/or beyond the COVID-19 pandemic.”

APPLICATION DEADLINE : MONDAY, APRIL 6TH 2020.

Eligibility Requirements

  • An existing business or nonprofit organization located within City of Berkeley with an active business license with the City of Berkeley as of March 1, 2020
  • Minimum 1 employee, Maximum 50 employees
  • Can demonstrate a 25% reduction in revenues due to COVID-19
  • Will use grant funding for payroll, rent, operating expenses and working capital

APPLY HERE NOW! -> https://cityofberkeleyoed.submittable.com/submit/4955c463-709c-49b8-b78d-2d48efa6922f/small-business-continuity-grants

SMALL BUSINESS : COVID-19 ECONOMIC INJURY DISASTER LOAN APPLICATION

“U.S. SMALL BUSINESS ASSOCIATION (SBA) has their application process ready so that you can apply for a loan for you business. SBA is collecting the requested information in order to make a loan under SBA’s Economic Injury Disaster Loan Program to the qualified entities listed in this application that are impacted by the Coronavirus (COVID-19). The information will be used in determining whether the applicant is eligible for an economic injury loan. If you do not submit all the information requested, your loan cannot be fully processed.U.S. SMALL BUSINESS ASSOCIATION has their application process ready so that you can apply for a loan for you business…”

APPLY HERE-> https://covid19relief.sba.gov/#/

ELIGIBILITY REQUIREMENTS

STEP BY STEP PROCESS