Businesses urged to immediately apply for $349B bailout program before money runs out
A screenshot of WBJ's webinar on the $2-trillion economic stimulus program
One message was clear during Worcester Business Journal's webinar Thursday about the $2-trillion stimulus package in the wake of the coronavirus crisis: Get your loan applications as soon as possible starting Friday.
“As soon as you get off this webcast, you should call your bank," said Terence Shepherd, managing partner of S&G Business Consultants & Certified Public Accountants in Worcester.
[Related: Here is a list of Mass. banks who made SBA loans in the last year]
The bulk of the discussion Thursday afternoon centered around the Payroll Protection Program, where the U.S. Small Business Administration has $349 billion for forgivable loans to businesses to avoid layoffs and salary cuts and to re-hire workers.
“Time is of the essence. You want to get into this program as soon as you can. Once the money in the program is gone, it is gone, unless Congress re-ups or extends the plan," said Amanda Risch, commercial finance attorney at Worcester law firm Fletcher Tilton.
Under the PPP, businesses with 500 or fewer employees can apply for loans up to $10 million to cover their expenses between Feb. 15 and June 30, particularly payroll.
Part of the loan is forgivable, for up to eight weeks of costs, although 75% of the forgiven portion must have gone to payroll. Borrowers must apply for forgiveness through the lenders who gave them the loan.
“Tomorrow morning, we are going to start processing the applications for those clients who have applied," said Tom Wolcott, senior vice president and commercial banking officer at Ware-based Country Bank. “The key is to get you into the portal and get you the decision.”
The SBA is planning on getting the money to businesses within a week of their application's approval, although that may or may not be realistic.
The amount forgiven will be lowered if companies reduce their payroll by cutting salaries or staff. Companies have until June 30 to re-hire staff who they have already laid off.
“The government really wants you to retain the people and keep the doors open," Shepherd said. “They want them to be rehired so they have some money in their pocket.”
The forgiveness isn't necessarily employee-specific, Risch said. Companies just have to get their payroll spending back to what it was.
Any bank, credit union or other lender can help companies apply for the PPP loans, even if they aren't an SBA-approved lender.
To learn more about the program, visit the SBA's webpage about the Payroll Protection Program.
A video of the entire webinar is available here. The next webinar on the stimulus package will be 2 p.m. on Monday. It is free, although registration is required at www.wbjournal.com/webinars.
WBJ Web Partners
Most Recent
Most Recent
0 Comments