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The Coronavirus Aid, Relief, and Economic Security (CARES) Act provides more than $376 billion in aid and relief to workers and small businesses under economic stress from the COVID-19 pandemic. This aid is distributed through the Small Business Administration’s (SBA) Paycheck Protection Program, Entrepreneurial Assistance, and Emergency Economic Injury and Disaster Loan Grants.

Paycheck Protection Program (PPP)

  • The program provides cash-flow assistance through 100 percent federally guaranteed loans to employers who maintain their payroll during this emergency

  • PPP has forgiveness of up to 8 weeks of payroll based on employee retention and salary levels, no SBA fees, and at least six months of deferral with maximum deferrals of up to a year.

  • Small businesses and other eligible entities will be able to apply if they were harmed by COVID-19 between February 15, 2020 and June 30, 2020. This program is retroactive to February 15, 2020, in order to help bring workers who may have already been laid off back onto payrolls.

Paycheck Protection Program’s Loan Forgiveness

  • If used for certain costs, the loan provided through the Paycheck Protection Program will be eligible for loan forgiveness.

  • Specifically—if the employer maintains its payroll—then the portion of the loan used to cover (1) payroll costs, (2) interest on mortgage obligations, (3) rent, and (4) utilities would be forgiven.

Emergency Economic Injury Disaster Loan (EIDL) Grants

  • The bill expands the number of organizations eligible for SBA’s Economic Injury Disaster Loans (EIDL).

  • These grants provide an emergency advance of up to $10,000 to small businesses and private non-profits harmed by COVID-19 within three days of applying for an SBA Economic Injury Disaster Loan (EIDL).

  • The advance does not need to be repaid under any circumstance, and may be used to keep employees on payroll, to pay for sick leave, meet increased production costs due to supply chain disruptions, or pay business obligations, including debts, rent and mortgage payments.




Small Business Debt Relief

  • This program will provide immediate relief to small businesses with non-disaster SBA loans, in particular 7(a), 504, and microloans.

  • Under it, SBA will cover all loan payments on these SBA loans, including principal, interest, and fees, for six months.

  • This relief will also be available to new borrowers who take out loans within six months of March 27, 2020.



Entrepreneurial Assistance

  • The bill provides funding for grants to SBA resource partners, including Small Business Development Centers and Women’s Business Centers, to offer counseling, training, and related assistance to small businesses affected by COVID-19.

  • Funds will also be provided for the Minority Business Development Agency to provide these services through Minority Business Centers and Minority Chambers of Commerce.

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