Senator Scott Wilk, representing the 21st Senate District, wants to make sure residents of the Antelope, Santa Clarita and Victor Valleys are aware of the new resources available for small businesses affected by the COVID-19 pandemic. The Coronavirus Aid, Relief, and Economic Security (CARES) Act signed into law last week establishes a variety of economic relief resources.
“We are in uncharted territory and I want to make sure people understand what is available so they can access the programs they need to make it through this situation. It is important that businesses take advantage of these programs so we get these federal dollars into California’s economy,” said Wilk. “There is a lot of information out there and that can be really overwhelming when you are worried about paying the rent, keeping your business afloat and feeding your family.”
Small Business Administrator Jovita Carranza and Treasury Secretary Steven T. Mnuchin announced that the Small Business Administration (SBA) and Treasury Department have initiated a robust mobilization effort of banks and other lending institutions to provide small businesses with the capital they need.
The CARES Act establishes a new $349 billion Paycheck Protection Program. The Program will provide much-needed relief to millions of small businesses so they can sustain their businesses and keep their workers employed.
The new loan program will help small businesses with their payroll and other business operating expenses. It will provide critical capital to businesses without collateral requirements, personal guarantees, or SBA fees—all with a 100% guarantee from the SBA. All loan payments will be deferred for six months. Most importantly, the SBA will forgive the portion of the loan proceeds used to cover the first eight weeks of payroll, rent, utilities and mortgage interest.
The Paycheck Protection Program is specifically designed to help small businesses keep their workforce employed. Visit SBA.gov/Coronavirus for more information on the Paycheck Protection Program.
The new loan program will be available retroactively from February 15, 2020, so employers can rehire their recently laid-off employees through June 30, 2020.
Loan Terms & Conditions
- Eligible businesses: All businesses, including non-profits, veterans organizations, tribal concerns and sole proprietorships with 500 or fewer employees or no greater than the number of employees set by the SBA as the size standard for certain industries. Self-employed individuals, and independent contractors are also eligible to receive these loans from the SBA.
- Maximum loan amount up to $10 million.
- Loan forgiveness if proceeds used for payroll costs and other designated business and operating expenses in the 8 weeks following the date of loan origination (due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs).
- All loans under this program will have the following identical features:
- Interest rate of 0.5%
- Maturity of 2 years
- First payment deferred for six months
- 100% guarantee by SBA
- No collateral
- No personal guarantees
- No borrower or lender fees payable to SBA
“Getting information I receive out to constituents will ensure they have every opportunity to get the help they need while navigating this unprecedented pandemic,” said Wilk. “My office is open and we are ready to help as well.”