Today Congress passed legislation to replenish Small Business Administration (SBA) loan funds to help small businesses and nonprofits cope with revenue losses caused by COVID-19. Following extensive negotiation between House and Senate leadership, the White House, and the treasury secretary, the new bill includes $380 billion in supplemental funding for SBA programs. The President is expected to sign the legislation promptly.
The Coronavirus Aid, Relief and Economic Security (CARES) Act enacted in late March appropriated $360 billion to the SBA for the Paycheck Protection Program and for Economic Injury Disaster Loans. The intensity of economic disruptions driven by the COVID-19 crisis, however, rapidly depleted those funds. Today’s action by Congress appropriates an additional $320 billion to the Paycheck Protection Program and $60 billion for Economic Injury Disaster Loans. Nonprofit 501(c)(3) cultural organizations are eligible to apply to both programs, as are creative entrepreneurs who are sole proprietors or self-employed. Interested applicants are urged to apply right away. See NASAA’s guidance on this topic for more information.
Notably absent from today’s legislation was any new relief for state governments. The CARES Act included $150 billion in aid to states and localities, but many states are concerned that those funds are insufficient to cover their mounting health care and economic costs caused by COVID-19. NASAA is urging Congress and the President to address this problem by appropriating additional funds to states and jurisdictions. Here is how you can help:
• Contact your senators and representatives to thank them for replenishing the SBA loan programs, noting that the eligibility of nonprofits has been important in your state.
• Urge your delegation to enact more relief funding for state governments. Communicate that this is a nonpartisan need and that you hope it will be given strong consideration as Congress formulates future policy responses to COVID-19. It would be beneficial for action to be taken soon, since many states are grappling with projected shortfalls heading into their fiscal year 2021 budgets.
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