Several financial assistance programs are available to help small businesses weather the storm. The programs below will likely be popular and could max out quickly. If you are interested in the funds, you should move quickly to apply.
Federal CARES Act Paycheck Protection Program (PPP)
This will be administered by the banks. It will forgive a portion of the loan that was used for payroll expenses, rent, healthcare benefits, retirement benefits, and state and local taxes assessed on payroll during the 8 week period following the issuance of the loan.
The requirement to get this is only that COVID-19 has negatively impacted your business. It seems most businesses could benefit from this. The loan amount will be for the average monthly payroll costs for 2019 times 2.5. So for an average payroll of 100,000/month in 2019, the loan would be for $250,000.
Applications will begin to be accepted on April 3, 2020. Since the funding on this program has a ceiling, you should move quickly to submit an application if you would like access to these funds. Talk to your business banker for details.
More information is at the Department of Treasury’s website.
Pennsylvania PIDA COVID-19 Working Capital Access Program
The state has announced special funding available to small businesses through a 0% loan. It is a 3 year loan capped at $100,000 with no payments due for the first year. You can find more information on the PIDA COVID-19 Working Capital Access Program page.
Update 4/2/2020 – PA funding for this program was exhausted, and they are no longer accepting applications.
SBA EIDL Program
This is a standard disaster loan from the SBA with favorable terms and is broadly available to many businesses. It has a maximum interest rate of 3.75% with a 30-year maturity. The loan can be up to two million dollars. Loans less than $200,000 do not require a personal guarantee. As part of this loan, an immediate $10,000 grant is available, even if the EIDL loan or the PPP loan is denied. However, if you also receive the PPP, the loan forgiveness with that program will be decreased by this 10,000; it is not cumulative.