What’s in the US bailout for your business?
Your business now has two more months to apply for your first or second round of PPP loans.
This month we’ll find out how the American Rescue Plan Act, the most recent law passed by the federal government, affects you and your business. The economy is overflowing with cash, $ 1.9 trillion, and it’s good to know where it’s flowing so you can figure out how to profit from it.
There are seven broad categories for where the money goes: people, healthcare, Native American tribes, education, veterans, state and local allowances, and small business. Knowing the main categories of money pooling is useful because your business and your employees may be able to sell your services and products directly to organizations and institutions that are being inflated.
The American Rescue Plan works in a very similar way when someone is given a high dose of antibiotics and quickly begins to recover, but as we all know from experience if we stop taking the antibiotics because we feel better , we relapse into our recovery and the whole process. takes longer. This is a good metaphor to keep in mind, because because the bailout law gives us and our businesses a boost, it will not guarantee a steady and rapid recovery. The real recovery comes from our own fiscal resilience (individual and business), and that means having savings, managing our cash flow, knowing our business and our individual ‘red lines’, following a budget and adapting our business models to reflect the new economic recovery.
Many companies are already adapting their business practices in this new ‘viral economy’ we find ourselves in by managing inventory, credit terms, where and how they market, changing staffing solutions to be flexible and finding new markets for sales. Now that we are thinking both in terms of where the stimulus money is for business and what we need to do on our own to keep our business recovery stable, we are in a better position to make the most of it. opportunities that apply to our businesses.
The best way to cash in your business is still the SBA’s Paycheck Protection Program (PPP), and the bailout law makes these P3 loans more accessible and really targets the most severely affected businesses (restaurants and businesses). bars). Eligibility for PPP has been broadened to include all businesses, including nonprofits, except 501 (C) 4, Lobbying Organizations. This means that all other nonprofits, limited liability companies, sole operators, limited partnerships, independent contractors, and construction workers can qualify to apply for a PPP loan. The extended application deadline is now May 31st.
Your business now has two more months to apply for your first or second round of PPP loans. This article does not focus on the eligibility and program criteria that make PPP the best source of liquidity for businesses affected by the pandemic, as previous articles have addressed this point and a quick Google search can explain them. benefits and costs.
Restaurants and bars have a new Restaurant Revitalization Fund, which provides financial support to family and private establishments and chains of less than 20 establishments. A considerable amount ($ 5 billion) is available for small restaurants and bars with incomes of less than $ 500,000 for 2019. It was created in collaboration with the Restaurant Revitalization Fund. Applications are expected to be opened this month and administered by the SBA; therefore, bookmark this page sba.gov/funding-programs/loans/covid-19-relief-options and keeping an eye on updates will keep you and your business in direct contact with the latest information and applications.
The SBA directly administers or facilitates the administration of the major financial programs mentioned in this article, PPP Loans, Restaurant Revitalization Fund, EIDL Program, Closed Site Operator Grants Program, and Community Navigator Pilot Program.
Economic disaster loans (EIDLs) continue to be viable options for accessing operating cash, although not as forgivable as PPP loans. This SBA-administered loan fund has an additional $ 15 billion injected into its loan pool. A clean subsidy option is available, known as the closed site operator subsidy program. This program received an additional $ 1.25 billion under the bailout law. Two other federal programs received large cash injections, both aimed at connecting local small businesses with the financing available to them through government, tribal and local programs, known as the Community Navigator Pilot Program and of State Small Business Credit Initiative.
Essentially, these programs are now brought in line with funding to increase the availability of business finance capital through small local, community and non-profit lenders, which is a good thing to stabilize the business recovery and develop economic resilience in our business community.
To learn more about specific business opportunities or other American Rescue Plan Act category allocation details and their potential impacts, please feel free to contact me by email or phone. NBF
By Chris Pasterz
Chris Pasterz is the Director of Economic Development for Coconino County. Pasterz can be reached at [email protected] or 928-679-7134.