By SEMA Washington, D.C., Staff
President Trump signed the Paycheck Protection Program and Health Care Enhancement Act into law on April 24, 2020, which provided $320 billion in additional funds to the Paycheck Protection Program (PPP) and $60 billion to the U.S. Small Business Administration’s (SBA) Economic Injury Disaster Loan (EIDL) program. SEMA-member companies looking to apply for the PPP loan should contact a bank where they have an existing relationship immediately, as strong demand for the loans is expected to exhaust the additional funding for the program next week. For more details, visit the SBA’s PPP page, which includes the application form and frequently asked questions.
The SBA is not accepting additional EIDL applications at the time of SEMA eNews publication, as the agency anticipates that a backlog of applications will exhaust the additional $60 billion in program funding. SEMA is urging lawmakers to add more money to both the EIDL and PPP programs.
The PPP provides loan guarantees for small businesses that equal up to 250% of a company’s monthly payroll (capped at $10 million). The SBA will forgive that portion of the PPP loan used to cover payroll, mortgage interest, rent payments and the cost of utilities for the first eight weeks if small businesses retain their employees and payroll levels. Under the EIDL program, a loan of up to $2 million at 3.75% may be used to pay fixed debts, payroll and other bills, with the first $10,000 being a forgivable grant.
For more information on PPP, EIDL and other federal programs related to COVID-19, check out SEMA’s resources at www.sema.org/coronavirus.
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