The Southeast Texas Nonprofit Development Center is alerting small businesses and nonprofit organizations struggling with COVID-19-related financial losses that CARES Act loan applications are now open.
According to a statement from the center, “The nonprofit sector has an incredibly important role to play, and we are inspired by the creativity, innovation and courage being demonstrated by Southeast Texas nonprofits.”
The center is also sharing information about other resources that its staff has “collected from trusted sources across the U.S. to help you navigate the new legislation intended to provide relief, so we can sustain our nonprofit organizations, staff and services in the community.”
One important resource offered by the CARES Act is the Paycheck Protection Program, open from April 3 to June 30. The federal government is “advising borrowers to apply as soon as possible given the loan cap on the program.” (Source: National Council of Nonprofits)
Important tips to know about the CARES Act and Paycheck Protection Program “What we do know is the CARES Act will provide a forgivable loan called the Paycheck Protection Program 7(a),” reports the center. “Highlights of this loan program include:
“Loans to nonprofits with fewer than 500 employees in order to cover basic costs and keep staff employed through the crisis; loans can be applied to payroll, health benefits, paid sick and family leave, mortgage interest, rent, utilities and debt interest; loan amount is calculated by a formula based on the average total of monthly payroll in the prior year; loans do NOT cover employees making over $100,000/yr, and with principal residences outside of the United States.”
In addition, the center described, “This loan will be eligible for ‘forgiveness,’ essentially turning into grants if they are used for the purposes as outlined as long as certain other conditions regarding maintaining employment levels in accordance with the law are met.”
A sample application is available on the Small Business Administration website. Nonprofits should apply through their local bank. Applications have started being accepted on a first-come, first-served basis as of April 3.
Additional sources of info and guidelines for CARES Act resources follow:
Coronavirus Emergency Loans Small Business Guide and Checklist – U.S. Chamber of Commerce;
CARES Act: How to Apply for Nonprofit Relief Funds – Independent Sector;
Webinar Financial Relief in CARES Act: Overview for Human Services Organizations (loan programs and other sources of new funds);
Paycheck Protection Program (Emergency SBA 7(a) Loans) Fact Sheet
Additional COVID-19 nonprofit resources can be found on the center’s website at setxnonprofit.org.