We just received information that starting tomorrow, Utah-based small businesses with 50 or fewer employees impacted by the COVID-19 pandemic may apply for a new bridge loan program offered by the Utah Governor’s Office of Economic Development (GOED). The Utah Leads Together Small Business Bridge Loan program uses approximately $8 million in repurposed state economic development funds. Additionally, the Utah Department of Workforce Services has contributed $500,000 to the program. Loan amounts range from $5,000 to $20,000 with 0% interest for up to a 60-month period. Loans cannot exceed three months of demonstrated operating expenses. Loan payments are deferred for 12 months, and GOED will use at least 25% of the program funds to support rural Utah businesses. Please refer to utahgoed.info/loan for complete details.
With some confusion on SBA loans available for small businesses, following is some helpful information:
There are two different types of loans that have been made available to support small business through this Coronavirus Pandemic
- SBA Economic Injury Disaster Loan (EIDL) – https://covid19relief.sba.gov/#/
You apply for these loans of up to $2 million directly through the SBA. Through this loan, for-profit businesses can access up to $2 million in working capital at a fixed rate of 3.75%, with up to 30-year terms and non-profit businesses can borrow up to the same amount at 2.75%. The first payment for this loan will be deferred for one year. Businesses that do not qualify for the SBA Economic Injury Disaster Loan may still be eligible for a federal assistance grant. There is an EIDL Advance where you can get a $10,000 loan quickly by simply filling out an application which requires very little documentation. If you have already started the loan process but was interrupted, the new application is much more simple and I’ve been told that you will not lose your place in line.
- Paycheck Protection Program (PPP) – https://www.sba.gov/funding-programs/loans/paycheck-protection-program
These loans will be disbursed by existing and newly approved SBA lenders. Many Utah Banks and Credit Unions are already SBA-approved lender and can choose to participate in the PPP Loan Program. If all employees are kept on payroll for eight weeks (you can rehire employees if interested), SBA will forgive the portion of the loans used for payroll, rent, mortgage interest, or utilities. Up to 100% of the loan can be forgivable. Check on whether your business is eligible as in certain industries, 500+ employees may still qualify. Senator Romney shared earlier today that time is of the essence as the $350 billion will not last long so get started sooner rather than later. You may want to reach out to your lending institution to start the process but understand that they are still writing the standard operating procedures and expect to launch on Friday. I loved the comment I heard today that the SBA is building a plane while it is being flown. More information is expected to be released in the next 24-48 hours. Stay tuned….
Remember there are also traditional loans available through the SBA and through your local lending institutions You can still tap into business advising, mentoring, and counseling support through the Small Business Development Center (SBDC), www.utahsbdc.org, and SCORE, www.score.org or Women’s Business Center www.wbcutah.org.For questions specific to the SBA, you can reach out to our partner at the SBA Utah District Office, Ian Lorenzana, Economic Development, Public Information Officer at: firstname.lastname@example.org .
According to Senator Romney’s website, businesses can be eligible to receive both the EIDL and the PPP loans if the loans are for different expenses. Refinancing options are also available if a business already has an EIDL loan. In the virtual meeting held earlier today, Senator Mitt Romney shared his Coronavirus Resources for Small Businesses: https://www.romney.senate.gov/smallbizhelp. We’re expecting to receive the audio from Senator Romney’s call this morning and will post it on our website under the coronavirus information tab.
If you find yourself in a position where you need to lay off or furlough employees, you can access more information at https://jobs.utah.gov/covid19/index.html. Answers to frequently asked questions by employers is available at https://jobs.utah.gov/covid19/uifaqemployers.pdf. The Utah Department of Workforce Services offers a Rapid Response Workshop designed to provide immediate aid to companies and affected workers from layoffs and worksite closings. There are some eligibility requirements that must be met. Utah offers a percentage of what the employee earned up to a maximum of $580/week. The federal government will be adding $600/week in addition to this amount.
Please let us know if we can provide any additional support. Please stay safe!