COVID-19 Small Business Funding
Federal Loan and Grant Programs
The following is a three-step process to help you navigate the five federal funding streams:
Step 1 – Adjust existing debt load: If you already have an existing 7(a) loan with the SBA, then your payments will be deferred. According to the SBA, they will pay the principal, interest, and any associated fees for six months beginning with your April payment (if you have already made it, we have been told you can ask for it back). Talk with your lending agent to confirm details.
Step 2 – Access fast cash: The week of March 30, 2020, the SBA made available up to $10,000 in fast and forgivable “grants” for small businesses and nonprofits (April 13 update: grants will be limited by the size of your organizations with a limit of $1,000 per employee). The application for this cash infusion should not take more than 25 minutes to complete. We are encouraging all our members to do this. The SBA promises a 3 day turn around but no grants have been received, even after two weeks. Get started now (follow the prompts for the EIDL Grant).
Step 3 – Apply for an emergency loan: There are three federal economic emergency loan programs for your consideration:
There are five federal loan and grant programs available right now to help your small or mid-size business during this COVID-19 crisis:
- “Economic Injury Disaster Loan” (EIDL)
- “EIDL Grant” (formerly called “ EIDL Cash Advance”)
- “Express Bridge Loan”
- “Paycheck Protection Program” (PPP)
- 7(a) Loan Payment Relief
As of Monday, June 15th the SBA has resumed processing EIDL applications for small businesses (now including sole proprietorship and independent contractors).
- You can click here to apply: https://covid19relief.sba.gov/#/After you confirm eligibility, the process is then 3 super simple pages. It takes about a half hour to complete with the most important questions to pay attention to are:
- Number of employees (see grant note below)
- Gross Revenues for the Twelve(12) Month Prior to the Date of the Disaster (January 31, 2020)
- Cost of Goods Sold for the Twelve(12) Month Prior to the Date of the Disaster (January 31, 2020)
- "EIDL Grant" money is equal to $1,000 for each employee up to $10,000 total. (This comes as a wonderful surprise deposit to your business account. A gift of income you do not repay.)
- For "EIDL Loan" approval you’ll be sent an e-mail to accept with a sliding scale of how much you would like. Terms are fabulous. 3.75% over 30 years. Then a loan officer gives you a call to verify identity and approve.
If you already have a business relationship with an SBA Express Lender and have an urgent need for cash, then the SBA Express Disaster Bridge Loan will allow you to access up to $25,000 quickly. This loan can be a term loan or used to bridge the gap while waiting for the decision and disbursement on an EIDL.
- Learn more about the Paycheck Protection Program
- Review the updated application form from June 24,2020
- Review this helpful PPP FAQ Document from the US Treasury
- Click here to learn about PPP Loan Forgiveness.
The PPP is a $350+$310 billion program established through the recent CARES Act on 3/27/20 (and recharged with funding on 4.23.2020) that uses loan forgiveness to help businesses keep employees on payroll. The PPP is administered through local and regional banks and includes loans of up to $10 million to cover payroll, interest on mortgage payments (principal or prepayments excluded), rent, utilities, and interest on any debt.
We know the federal funding streams are complicated and information is changing daily. The SBA's breakdown of funding options is extremely useful.
The Chamber is archiving all of our past seminars and briefings here.
Covid Loan Tracker is surveying small businesses across the country and reporting their experiences with the PPP, including loan amounts, processing time, etc. Check it out, and keep in mind this is only based on self-reporting.
State and Local Emergency Capital
NC COVID-19 Rapid Recovery Loan Program: The Golden LEAF Foundation announced a loan program, managed by the NC Rural Center, called the NC COVID-19 Rapid Recovery Loan Program that is intended to support small businesses as they recover from the economic impact of COVID-19. The program provides loans up to $50,000 with six months of no interest and no payments. On May 4th, as part of NC's COVID-19 relief package, another $125 million was directed to the program.
(CLOSED) Orange County Emergency Small Business Funding Program: Orange County small businesses are invited to apply for zero interest loans up to $20,000 with repayment over 5 years and grants of $5,000 were made available as well. The deadline was Wednesday, June 17, 2020 at 11:59 p.m.
(CLOSED) Town of Carrboro Small Business and Nonprofit Emergency Fund: On April 21st, Carrboro town council voted to reopen the fund for a second round of loans. The application will reopen soon--stay tuned for updates. This is a 90 loan/10 grant program with a maximum loan of $25,000 with 0% interest. This program is designed to help Carrboro-based businesses and Carrboro-serving nonprofits with short-term payroll coverage. The deadline for second round applications was May 5, 2020 at 5:00 p.m.
The SBTDC provides real-time, one-to-one counseling for local business owners and managers as they navigate these challenging times, on topics including cashflow and staff scenario-planning, access to capital and help with applying for business loans. They also have an excellent state-level page of resources. The SBTDC Center in Chapel Hill serves small and mid-size businesses throughout Alamance, Chatham, Lee, Orange, and Person Counties. Schedule a free and confidential business counseling session now.
Another free, confidential business counseling resource is at the Small Business Center at Durham Tech, which serves Durham and Orange Counties, and Central Carolina Community College, which serves Chatham, Harnett, and Lee counties.
The Economic Development Partnership of North Carolina compiled a list of resources here. Their business counselors are also available to answer questions by phone at 800.228.8443.
Nonprofits: Triangle Community Foundation has compiled a really useful list of resources, available here.