Michigan SBDC, SBA will help eligible employers apply for federal economic disaster loans.
GRAND RAPIDS, Mich – (GRBJ) – The Michigan offices of a pair of national agencies are working to help small businesses understand their options, including emergency lending, during the coronavirus crisis.
Rob Scott, Great Lakes Regional Administrator for the US Small Business Administration, hosted a media conference call on Friday, March 20 with SBA Michigan District Director Constance Logan and SBA District Directors from Cleveland and Columbus, Ohio.
The purpose of the appeal was to clarify the terms and eligibility of low-interest federal disaster working capital loans for Michigan small businesses experiencing losses as a result of COVID-19.
After declaring a state of emergency related to the pandemic on March 11, Gov. Gretchen Whitmer sought and received SBA approval on March 19 for a declaration of loan in the event of a global economic disaster. Government, opening up the possibility for certain small businesses to access low interest on government loans.
“This designation unlocks critical financial resources for small businesses in the state affected by the difficult but necessary steps we have taken to mitigate the spread of the coronavirus here in Michigan,” Whitmer said at the time.
These mitigation measures included shutting down all non-essential Michigan businesses as part of Whitmer’s March 23 executive order “Stay Home, Stay Safe.”
“While access to these loans is vital, we continue to review all available resources to support our businesses, communities and entrepreneurs across the state affected by the coronavirus,” Whitmer said.
State banking regulators and federal financial institution regulators, in a joint statement on March 22, urged banks and financial institutions to work with borrowers on short-term loan modifications as another form of assistance, which could include payment deferrals, fee waivers, extensions of repayment terms. or other “insignificant” payment delays.
SBA disaster loans are for those who are unable to access other forms of credit / forbearance and do not have “the financial capacity to offset the negative impact without difficulty. According to the SBA.
The SBA acted on its own authority in declaring a disaster, as provided for in the Supplementary Appropriations for Coronavirus Preparedness and Response Act signed by President Donald Trump on March 4.
The disaster declaration for this region makes SBA assistance available throughout the state of Michigan and the contiguous counties of Elkhart, La Porte, Lagrange, St. Joseph and Steuben in Indiana; Fulton, Lucas and Williams in Ohio; and Florence, Forest, Iron, Marinette and Vilas in Wisconsin.
“The SBA is strongly committed to providing the most effective, customer-centric response possible to helping Michigan small businesses obtain federal disaster loans. We will be swift in our efforts to help these small businesses recover from the financial impacts of the coronavirus, ”said SBA Administrator Jovita Carranza, who is a member of Trump’s cabinet and works on behalf of 30 million small businesses. American companies.
On the regional media conference call on March 20, Scott said the SBA was now “solely focused” on efforts to recover the economy.
Small businesses, private non-profit organizations, small agricultural co-operatives and small aquaculture businesses that have been financially affected as a direct result of COVID-19 can borrow up to $ 2 million through the Loan In Case program. economic disaster, Scott said.
“It’s not a grant. It’s a loan, ”he said.
Loans can be used to pay off fixed debts, payroll, accounts payable, and other bills that cannot be paid due to the impact of the disaster.
The interest rate for fixed rate loans up to 30 years is 3.75% for small businesses and 2.75% for private associations.
The long-term repayment schedule is designed to keep payments affordable during what is sure to be a long economic recovery.
Scott said the SBA hosts webinars with PowerPoints to help small businesses navigate the loan application process.
More information on the process is available at catastropheloan.sba.gov/ela.
Applicants can also call the SBA Customer Service Center at (800) 659-2955 or email [email protected] for more information on SBA Disaster Assistance. People who are deaf or hard of hearing can call (800) 877-8339.
Completed applications should be mailed to US Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, Texas, 76155.
The deadline to apply for an economic disaster loan is December 21, 2020.
So far, the turnaround time for disbursements after completed and approved applications has been “fairly quick” in this region, Scott said, with businesses receiving loans in one to five days. He added that the SBA disaster teams nationwide have been prepared by the recent hurricanes to quickly process emergency loan program applications, which has allowed them to gain experience in a situation like this.
Scott said that if applicants are turned down, the SBA does everything possible to reach out and assess why and help them work toward eligibility to try again.
Logan, the director of SBA Michigan, said she was giving up everything to answer emergency small business questions during this time.
“We’re going to be fine. … We are very committed to making an impact in the small business community, ”she said.
Michigan SBDC has been asked to logistically support the Economic Disaster Lending Program.
Ed Garner, regional director of the West Michigan SBDC office located at Seidman College of Business at Grand Valley State University, said the office recognizes the unprecedented level of difficulty faced by small businesses today during the crisis. of COVID-19.
“Michigan SBDC Business Consultants are here to help small businesses navigate their response to COVID-19, including accessing the SBA’s Economic Disaster Lending Program,” he said. “We can help you determine if this loan is right for your business and connect you with the resources you need to move forward with confidence. “
Michigan SBDC has also implemented a COVID 19 page on sbdcmichigan.org/small-business-covid19 with options for small business support, including links to webinars and SBA webinar summaries; has created its own webinar series on hot topics, such as cash flow management, marketing and human resources issues in times of crisis; and expanded its remote business advisory capacity.
Additionally, the Michigan SBDC has been tasked with supporting a state program to help small businesses affected by the stay-at-home order.
The Michigan Economic Development Corporation’s Small Business Assistance Program of the Michigan Strategic Fund will provide up to $ 20 million to small businesses negatively affected by COVID-19.
The funding is split between $ 10 million in small business grants and $ 10 million in small business loans. Funding for the program is expected to be available no later than April 1, 2020.
More information is available at sbdcmichigan.org/small-business-relief-program.
This story originally appeared in the Grand Rapids Business Journal. To find similar content, get a copy or find more on their website.
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