On behalf of the Borough of Hawthorne and the Hawthorne Chamber of Commerce - we have been monitoring the Coronavirus Aid, Relief, and Economic Security Act (CARES) Act on the new initiatives from the Small Businesses Administration (SBA).
On Friday, April 3, 2020, the Small Business Administration lenders will be launching the Paycheck Protection Program (“PPP”). The PPP authorizes up to $349 billion in forgivable loans to small businesses to pay their employees during the COVID-19 crisis. All loan terms will be the same for everyone.
The loan amounts will be forgiven as long as:
- The loan proceeds are used to cover payroll costs, and most mortgage interest, rent, and utility costs over the 8 week period after the loan is made; and
- Employee and compensation levels are maintained. Payroll costs are capped at $100,000 on an annualized basis for each employee. Due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs. Loan payments will be deferred for 6 months.
You can apply through any existing SBA lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution.
Application and instructions can be found on the following web links:
Individuals and businesses should consult with their financial advisors and institutions.