A new small business loan designed to help business owners impacted by the pandemic will be provided this week, and Chamber officials are rolling out plans to spread the word.
The Carroll County Chamber of Commerce is telling business owners about a new loan that will be part of the federal economic stimulus plan passed by Congress last week. In addition, the Chamber has created a “Think Carroll First” Facebook group for owners of small businesses to share ideas for remaining afloat, and to receive guidance on how to apply for small business loans.
Chamber president and CEO Daniel Jackson said the “two biggest things” available for businesses are the Small Business Administration loans provided by the federal $2.2 trillion economic stimulus package and the unemployment assistance by the state Department of Labor.
“The general idea of the stimulus bill is that companies can apply for loans that turn into forgivable loans,” said Chamber of Commerce Vice President of Economic Development J.R. Charles. “They turn into grants, but they actually have to apply for them.”
Business owners can seek financial relief through the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which allocated $350 billion to help small businesses keep workers employed amid the pandemic.
Known as the Paycheck Protection Program, the initiative provides 100% federally guaranteed loans to small businesses. Lenders can start accepting applications as soon as Friday, April 3, Charles said.
The loan will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent and utilities. Loan payments will also be deferred for six months, according to the Small Business Administration’s website.
While the maximum amount of the loan is $10 million, Charles said the administration gives guidance to business owners to apply for 2.5 times the amount of their monthly expenditures.
The loan has a lifespan of two years and an interest rate of 0.5%. Interest on the loan is not forgivable, Jackson added.
“Businesses need to work with their bankers and accountants to help them navigate through this,” Jackson said. “We’re the ones who pass on this information and we’re not the ones to declare that.”
The aim of the program is to get cash into the hands of suffering business owners quickly without the red tape and fewer guardrails than the business administration’s existing loans.
A small business is eligible if they have less than 500 employees or is a 501©(3) with less than this number of workers. This includes all full-time, part-time or any other employees. Individuals who operate as a sole proprietor, are self-employed or independent contractors also qualify.
If a business owner can prove that the current economic conditions make the loan request necessary by providing documentation on payroll, utilities, and lease payments, the person will qualify for the loan.
Employers can also file partial unemployment claims on behalf of their employees. The claims can be filed if a full or part-time employee works less than 40 hours a week due to a partial or total company shutdown caused by the pandemic.
Filing partial claims results in employees receiving unemployment insurance (UI) benefit payments faster, usually within 48 hours for claims filed electronically. Employees are not required to report to a state Department of Labor career center, register for employment services or look for other work.
Along with the Facebook page to assist small business owners, the Chamber is promoting a “virtual tip jar” for restaurant employees who are out of work, and a gift card program for local shops and restaurants.
Charles said a new virtual tip jar was created online for residents to donate any amount to the restaurant workers that have been laid off due to the coronavirus.
Residents can also use the Chamber website to buy gift cards from local shops and restaurants. The program is accessible only to members this week, but will open to the community next week, Chamber Director of Member Engagement Rhyne Owenby said.
These donations can either be a one-time gift or a monthly payment, and the website was created by the Community Foundation of West Georgia in partnership with the Chamber.
Anyone willing to donate can do so by visiting the Chamber of Commerce website and access the “tip jar” and buy gift cards under the “Buy Now, Shop Later” tab at the top of the homepage.