On Friday, March 27th the CARES Act was signed into law. It includes $2 trillion of relief, including $350 billion specifically directed to small businesses.
We’ve begun compiling a list of articles and helpful resources to make sense of the CARES Act.
For those considering applying for a loan you may want to take a few key actions to be prepared.
Key actions to be prepared for loan assistance (source):
- Gather payroll records for the past 12 months. Your payroll costs will serve as the basis for the maximum loan amount (i.e., 250% of these costs). The application likely will require documentation to justify the loan amount and to satisfy the other items that need to be verified. As a reminder, these costs include not only salaries and wages, but also expenses for paid leave, health care, and other benefits.
- Reach out to lenders. All SBA-certified lenders will be authorized to make PPP loans. In addition, it is expected that the Treasury Department will authorize nearly all FDIC-insured lenders to participate in the program. While banks may not have a lot of answers at the moment, it may be helpful to contact your bank to (i) confirm that they are SBA-certified and are participating in the PPP, and (ii) learn whether there are any initial steps that could be taken to expedite the process (such as providing ownership information or related documentation to satisfy “know your customer” or other requirements). In fact, businesses may want to reach out to a few different lenders so that they have options to choose from, since lenders likely will have different processing times and requirements.
Save Restaurants Summary of The CARES Act
Columbia Business School SBDC Resources for Small Businesses.
Eater Summary of benefits and negatives of the CARES act for food and beverage businesses.
Coronavirus: Guide to Federal Small Business Stimulus Aid Programs - US Chamber Resource
Coronavirus (COVID-19): Small Business Guidance & Loan Resources - SBA Gov Resource
Coronavirus: The Senate Passes the CARES Act; Summary of the Tax Provisions of the Bill - Summary from The National Law Review
Senate Passes Omnibus CARES Act - Summary from Steptoe Law Firm