Cliffs Notes for Business Relief
As we’re sure you know, there is a boatload of information regarding the many state and federal programs designed to stimulate the economy and provide relief to businesses, nonprofits and employees. Details are changing daily, so here is a brief overview of the higher profile programs:
Federal CARES Act
- A new $350 billion loan program at SBA for small businesses, self-employed, and gig workers to help them from going under due to the COVID-19 pandemic. If employers maintain payroll, the loans would be forgiven.
- Provides working capital loans of up to $2 million to help overcome temporary loss of revenue. Small business owners are now eligible to apply for an advance of up to $10,000. Funds will be made available within three days of a successful application, and the advance does not have to be repaid.
Employee Retention Tax Credit (US Chamber Guide)
- A new tax credit for employers who are closed, partially closed, or experiencing significant revenue losses. Generally, 50% tax credit for the first $10,000 of compensation for each eligible employee. Employers who receive a Paycheck Protection Program (PPP) loan are not eligible.
Families First Coronavirus Response Act
Federal Department of Labor program requires businesses with fewer than 500 employees to provide their employees with paid sick or family leave related to COVID-19. Applies to those under quarantine or those caring for quarantined individuals. Generally starts at 80 hours of paid leave.
Minnesota Small Business Emergency Loans
Interest-free loans up to $35,000 available to Minnesota-based businesses in consumer-oriented sectors like restaurants, fitness centers and salons. Loans will be paid back monthly over 5 years and the first payment is deferred 6 months. Partial forgiveness may be available.
Note: This program has likely received applications that exceed available funds. We would still encourage businesses to apply if appropriate. The state legislature may add more funds in the future.
Minnesota Unemployment Insurance
Generally replaces 50% of an employee’s income (up to $740/week) with no standard waiting period or employer penalties due to COVID-19. The Shared Work Program allows employers to enable benefits if they reduce hours in lieu of layoffs. It is still unclear of how or when people can access an additional $600/week, per the federal CARES Act. We strongly encourage everyone to monitor the Minnesota Chamber COVID-19 Toolkit for the frequently updated links and advice. For a great overview of what’s available, watch their latest webinar (about 40 minutes).
Business Relief at the Local Level
Finally, the Brainerd Lakes Chamber is hosting a webinar at 2:00 next Monday, April 6th called Business Relief at the Local Level. A panel of local business leaders will discuss available relief options that are available locally—without the red tape, from people you know and trust. It will include plenty of time for Q&A.