SBA loan application mechanisms are opening up for the first round of assistance through low-interest loans.
One of the ways that America helps support those affected by disasters is through SBA low-interest loan programs for small businesses. In order for our industry to make use of small business disaster loans, Congress has to approve the expenditures, and agencies like the Small Business Administration (SBA) have to establish the correct infrastructure to support the loan programs. SBA has done this and these loans are expected to have an interest rate of 3.75% for small businesses and 2.75% for non-profit organizations (under current law they must be no higher than 4%).
The pieces of the puzzle are falling into place. Yesterday, the declaration of a national emergency was formally published in the Federal Register. Based on the March 13 Executive Order, this publication establishes the right for the Health and Human Services Department to take certain steps to temporarily waive or modify certain requirements of the Medicare, Medicaid, and State Children’s Health Insurance programs and of the Health Insurance Portability and Accountability Act Privacy Rule throughout the duration of the public health emergency.
While a small sum has already been approved, this is one of the projects that Congress is working on right now, and most people expect Congress to approve a much larger package of emergency relief including significantly more SBA loan authority. ASA has been working to try to make sure this money is made available to the aviation supply chain community.
A sum of money has already been approved for Covid-19 disaster assistance loans. The purpose of the money is to serve as working capital for businesses that are economically affected by Covid-19. States that have already asked for the money (typically in concert with a disaster declaration by the governor include (links are to the SBA press releases announcing availability of funding for each state, which should have additional useful links):
- the District of Columbia
- New Hampshire
- New Jersey
- New Mexico
- North Carolina
- Rhode Island
Don’t see your state in the list? First, check out the adjacent states – for example the Florida declaration includes certain adjacent counties in Georgia and Alabama (and Alabama does not yet have its own SBA Covid-19 declaration). The Washington, DC declaration includes neighboring counties in Maryland and Virginia (neither of whom has their own declaration, yet). Second, contact your state government to see what information you can provide to assist them in making a disaster declaration for the state, and communicating that declaration to the federal government.
Note that a few days ago we reported that the Covid-19 disaster areas were not yet listed on the SBA website. As of today, they are now listed.
ASA has developed resource to help you communicate with your members of Congress, including:
- General instructions for communicating your concerns to Congress
- Instructions for identifying and contacting your members of Congress
- An email template explaining the situation and asking for assistance to be targeted to the aviation supply chain
- A letter template explaining the situation and asking for assistance to be targeted to the aviation supply chain
Let them know what you are thinking and what your business needs to survive!