BREAKING NEWS FOR THE BUSINESS COMMUNITY
Updated: April 30, 2020
Special Highlights:
PPP UPDATE: IRS PROVIDES GUIDANCE REGARDING THE TAX DEDUCTIBILITY OF EXPENSES PAID WITH PPP FUNDS Courtesy of SAX LLP
On April 30, 2020, the Internal Revenue Service (IRS) released Notice 2020-32, providing clarity surrounding the federal tax implications of funds received under the Paycheck Protection Program (PPP). Specifically, the IRS has confirmed that federal tax deductions are disallowed in situations where the expenses are paid for with forgiven funds received under Section 1106 of the CARES Act.
Prior to the issuance of this notice, taxpayers had questioned whether the ordinary and necessary trade or business expenses paid and incurred during the 8-week loan forgiveness covered period would also give rise to a tax deduction. In issuing this clarification, the IRS has cited Internal Revenue Code (IRC) Sec. 265, which disallows expenses related to tax-exempt income.
While we await further guidance from the state and local taxing jurisdictions in terms of the taxability of these funds, this release provides welcome transparency for taxpayers looking to determine the tax impact of the forgiven funds.
Tune into our webinar on Thursday, May 7th at 10AM for additional information on this topic. Register for this webinar here: https://register.gotowebinar.com/register/7226838547824677391.
PPP Update from the USSBA Courtesy of Sheryl Paynter, USSBA
PPP Round 2 so far - 2.2 million+ loans totaling $175 billion+ - in 1 week. ($310 billion is the cap.) SBA did 1.66 million loans in ALL of PPP Round 1 Avg loan size for Round 2 is $79,000 versus Round 1 average of $206,000
NJ businesses are doing much better in the second round! For the first round, NJ businesses received 33,519 PPP loans totaling $9,527,794,260 through 4/16/2020. For the second round, NJ businesses have already received 77,364 loans totaling $7,486,962,885 with more to come!
ICSC's Guide for COVID-19 Re-Opening Best Practices Courtesy of International Council of Shopping Centers ICSC has aggregated information from a variety of sources to create re-opening best practices for your consideration. We’ve covered topics including planning and communication, common area adjustments and traffic flow. We recommend you refer to CDC guidelines, as well as local and national authorities, for further guidance. View ICSC's COVID-19 Re-Opening Best Practices here. General recommendations for owners and operators Upgrade cleaning and hygiene practices: Increase cleaning focus on disinfecting areas most susceptible to the spread of viral germs (e.g. children's play areas, public restrooms, door handles, escalator handrails, food court tables, etc.) Install and maintain alcohol-based hand sanitizer dispensers in locations where the spread of germs is likely and normal soap and water hand washing stations are not readily available. Establish good communication with local health departments and follow local public directives. Display CDC public service announcements at entrances and throughout the property. Distribute communications to tenants outlining basic CDC recommendations or local government instructions. Encourage employees who are sick to stay home.
*** NJBIA Survey Paints Positive Outlook for Reopening, But Not Without Challenges Source: NJBiz, April 28, 2020
More than 80 percent of business owners say they’ll need 50 percent or more of their usual customer base each month to break even after COVID-19 closures, according to a New Jersey Business & Industry Association Business Recovery Survey checking on how members’ business model would fare in a statewide soft opening.
If a soft opening allows a 50 percent partial reopening of businesses in the state, 23 percent of respondents said it would take them more than a year to generate revenue comparable to pre-pandemic profits. A smaller percentage, 6 percent, said it would take more than two years to generate comparable revenues. While 51 percent of businesses anticipate spans of months up to a year to generate pre-COVID-19 profits operating at 50 percent capacity, 21 percent don’t expect to be able to generate comparable profits at that capacity.
“The results of this survey put a finer detail on the true challenges that lie ahead, even with a soft opening at 50 percent capacity, as we work toward a recovery and reinvention framework for New Jersey’s economy,” said NJBIA President and Chief Executive Officer Michele Siekerka in a statement.
“Some of our additional data focusing on revenues and financial assistance also reveal great challenges. However, now knowing the true needs and concerns of our businesses in even a partial re-opening allows us to work toward solutions and an effective plan of action for the reopening of our economy,” Siekerka said.
For business to operate productively, 27 percent of respondents said that they need 100 percent of their in-person workforce. Thirty-five percent of respondents need under 50 percent of their in-person workforce to be productive, and 38 percent need between 50 and 99 percent for productivity.
Employers were asked to list the top three struggles for their businesses. Meeting payroll cost (59 percent) was the highest, while paying rent (44 percent) and ensuring worker safety (22 percent) were second and third, respectively. Twenty- one percent of employers expect handling supply chain disruptions to be within their top three struggles, 20 percent included making quarterly tax payments in, and 19 percent included paying payroll taxes.
Other struggles yielding 12 percent or less included making quarterly or annual corporate business tax and gross income tax payments; complying with labor mandates; the cost of maintaining equipment; finding enough employees to fill workplace needs; and concerns about future lawsuits.
When asked if their business could operate under Centers for Disease Control and Prevention social distancing guidelines, 70 percent said yes, while 19 percent said they were not sure, and 10 percent said they wouldn’t be able to operate under those guidelines.
“It’s a positive to see the capability and willingness of employers to operate with appropriate social distancing,” Siekerka said in a statement. “What remains to be seen is what entry limitations will be put on businesses, and whether customers will have the same initial willingness to patronize out of health concerns.”
When asked how or if their physical workspace might be affected as a result of COVID- 19, only 7 percent anticipated the need for structural changes to implement social distancing. Twenty-nine percent said their workspace will not be impacted, 23 percent expected increased costs for sanitizing, and 20 percent expected added costs for personal protective equipment. Only 7 percent said they would need structural changes to implement social distancing.
While many businesses report an ability to adapt, two-thirds of said they experienced a decrease in revenue due to the current pandemic, while 27 percent reported no revenue. Only 5 percent of businesses reported normal revenue.
About one-third of respondents have laid off at least one worker during the COVID-19 pandemic.
“It would appear there’s a correlation between the number of companies reporting no revenue to the number of companies having to lay off at least one employee,” said NJBIA Director of Economic Policy Research Nicole Sandelier in a statement. “Nearly 8 percent of respondents said they have let go of 10 workers or more, which relates to some of the high unemployment numbers we have seen on a state and national level.”
Just over half of respondents said they either reduced workers’ hours, or furloughed or laid-off employees to accommodate for lost revenue.
Of the 36 percent of respondents who had to close as a result of a COVID-19 related executive order, 3 in 10 of those weren’t sure if they would ever reopen.
Of those that had to close their premises, 7 in 10 said they were operating remotely, experiencing financial losses. Ten percent said they were continuing normal operations.
One in 4 businesses reported they were unable to perform their essential business duties, and 54 percent of respondents listed their business as struggling to perform essential duties.
The three Ps
Regarding federal Paycheck Protection Program loans, 74 percent of those surveyed applied. As of when they were surveyed – between April 23 and 28–, 65 percent said they had not yet received funding while 30 percent said they had. Five percent reported that they were not approved.
A little more than 98 percent of employers reported that they would put PPP money toward payroll costs, while 68 percent said they would apply some funds to utilities, 66 percent said they would apply some funds to rent, and 15 percent said they would apply some funds to mortgage interest.
Of businesses who reportedly applied for a Small Business Emergency grant or loan from New Jersey Economic Development Authority, 78 percent had not received their funds as of when they were surveyed.
The 1,359 respondents were comprised of NJBIA members and also members from other partnering business associations in the New Jersey Business Coalition.
***
New Jersey Economic Development Authority Financing Support for Business in Response to COVID-19
The EDA Board met on March 26, 2020 and approved a package of several programs to assist companies impacted by the COVID-19 health crisis.
For Information on both State of NJ and Federal USSBA Programs visit: https://assistance.business.nj.gov/
A package of new initiatives from the New Jersey Economic Development Authority includes a grant program for small businesses, a zero-interest loan program for mid-size companies, support for private-sector lenders and Community Development Financial Institutions (CDFIs), funding for entrepreneurs, and a variety of resources providing technical support and marketplace information. Taken together, they will provide more than $75 million of State and private financial support, with the opportunity to grow to more than $100 million if additional philanthropic, State, and federal resources become available. The initiatives will support between 3,000 and 5,000 small and midsize enterprises and are meant to complement recently announced federal economic recovery initiatives.
Please check the link: http://www.hawthornenj.org/DocumentCenter/View/1536/NJEDALoanPresentation for additional information on each NJEDA program.
HOTLINE for NJEDA Grant Programs: 844-965-1125 ONLY.
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NJEDA Now Accepting Donations to Support Small Businesses Impacted by COVID-19 Content from BioNJ
The New Jersey Economic Development Authority (NJEDA) today announced it will be accepting donations from individuals and companies to support the Authority’s Small Business Emergency Assistance Grant Program, which provides grants to New Jersey small businesses impacted by the COVID-19 outbreak. Individuals and companies interested in making a donation should contact [email protected].
Applications for the NJEDA’s Small Business Emergency Assistance Grant Program launched on April 3, 2020. Within an hour, the program was oversubscribed; within a week, the NJEDA received more than 30,000 applications. To address the massive need for support, the NJEDA has created a process for corporate and philanthropic partners to make donations to expand the Program.
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Small Business Emergency Assistance Grant Program – A $5 million program that will provide grants up to $5,000 to small businesses in retail, arts, entertainment, recreation, accommodation, food service, and other services – such as repair, maintenance, personal, and laundry services – to stabilize their operations and reduce the need for layoffs or furloughs. Learn More: https://faq.business.nj.gov/en/articles/3835237
GRANT APPLICATIONS CLOSED April 10, 2020
Small Business Emergency Assistance Loan Program – A $10 million program that will provide working capital loans of up to $100,000 to businesses with less than $5 million in revenues. Loans made through the program will have ten-year terms with zero percent for the first five years, then resetting to the EDA’s prevailing floor rate (capped at 3.00%) for the remaining five years.
Applications for the Small Business Emergency Assistance Loan Program will be accepted as of April 13, 2020.
Community Development Finance Institution (CDFI) Emergency Loan Loss Reserve Fund – A $10 million capital reserve fund to take a first loss position on CDFI loans that provide low interest working capital to micro businesses. This will allow CDFIs to withstand loan defaults due to the outbreak, which will allow them to provide more loans at lower interest rates to microbusinesses affected by the outbreak.
Notice of Funding Availability: Applications for the CDFI Emergency Assistance Grant Program Will Open at 9:00am on Wednesday April 8, 2020 on https://application.njeda.com/.
CDFI Emergency Assistance Grant Program – A $1.25 million program that will provide grants of up to $250,000 to CDFIs to scale operations or reduce interest rates for the duration of the outbreak.
List of Community Development Finance Institutions (CDFIs) The New Jersey Economic Development Authority (NJEDA) announced a partnerships with six Community Development Financial Institutions (CDFIs). These partnerships will leverage New Jersey-based CDFIs to provide between $20 million and $30 million in low-cost financing to small and microbusinesses and nonprofits impacted by the COVID-19 outbreak.
“Microbusinesses, nonprofits, and other small businesses that rely on CDFIs for the capital they need to grow are a vital component of New Jersey’s economy. They have been hit particularly hard by the COVID-19 outbreak,” said NJEDA Chief Executive Officer Tim Sullivan. “These partnerships will allow CDFIs to expand their operations to help more businesses withstand today’s challenges and return to full strength as soon as possible.”
UCEDC: www.ucedc.com 908-527-1166
GNEC – Greater Newark Enterprises Corp.: http://www.gnecorp.org 973-242-4132
RBAC – Regional Business Assistance Corp.: www.rbacloan.com 973-242-4132
NJCLF – New Jersey Community Capital: www.newjerseycommunitycapital.org/ 732-640-2061
CBAC – Cooperative Business Assistance Corp.: www.cbaclenders.com 856-966-8181
PURSUIT--(formally the Excelsior Growth Fund): www.pursuitlending.com 800-923-2504
NJEDA is accepting Applications for the NJ Entrepreneur Support Program as of April 22, 2020
NJ Entrepreneur Support Program – The New Jersey Entrepreneur Support Program is a $5 million program that will create a guarantee to support repayment of an investor loan advanced for working capital purposes and is designed to encourage investors to support businesses within their portfolios.
The program will provide an 80 percent NJEDA guarantee for an eligible new loan or convertible note by a qualified investor into a New Jersey qualified business, not to exceed a $200,000 guarantee per company. Investors are qualified for the program if they have already provided funding to a New Jersey company through a simple agreement for equity (SAFE), convertible note, or equity investment as of March 9, 2020 (the date of the Governor's Executive Order 103). Participating investors are not required to be New Jersey residents and can include, but are not limited to, individuals, trusts, and corporations. There will be no fees associated with the NJ Entrepreneur Support Program for the first five years of a loan and then standard modification fees will apply.
To be eligible to benefit from the program, a company must be headquartered in New Jersey, have fewer than 25 total employees with a minimum of 50 percent of its employees in the Garden State, and under $5 million in revenues as of December 31, 2019.
Additional eligibility requirements for both investors and entrepreneurs can be found at http://cv.business.nj.gov.
Small Business Emergency Assistance Guarantee Program – A $10 million program that will provide 50 percent guarantees on working capital loans and waive fees on loans made through institutions participating in the NJEDA’s existing Premier Lender or Premier CDFI programs.
Emergency Technical Assistance Program – A $150,000 program that will support technical assistance to New Jersey-based companies applying for State and US Small Business Administration programs. The organizations contracted will be paid based on SBA application submissions supported by the technical assistance they provide.
The NJEDA has created a webpage that directs business owners to various resources to assist in coping financially with the COVID-19 public health crisis. This site will be updated with any new programs or support that becomes available. https://www.njeda.com/about/Public-Information/Coronavirus-Information https://faq.business.nj.gov/en/articles/3838662-what-new-state-financial-support- programs-are-available-to-businesses-impacted-by-the-covid-19-outbreak
NJ EDA Technical Assistance to Companies to Complete Applications:
Rising Tide Capital 384 Martin Luther King Drive, Jersey City, NJ 07305 201-432-4316 [email protected] www.risingtidecapital.org
African American Chamber of Commerce of NJ 379 West State Street, Trenton, NJ 08618 609-571-1620 www.aaccnj.com
NJ State Veterans Chamber of Commerce 65 School Road West, Marlboro, NJ 07746 732-778-7708 [email protected] www.njveteranschamber.com
Statewide Hispanic Chamber of Commerce of NJ 1280 Wall Street West, Suite 312, Lyndhurst, NJ 07071 201-935-0035 www.shccnj.org [email protected]
State of New Jersey Website Devoted to COVID-19 Business Concerns
The State of New Jersey has established a special website devoted to business concerns during the coronavirus emergency. The site, cv.business.nj.gov, will be updated as new information becomes available. We encourage you to communicate this with the appropriate individuals within your organization.
In addition, the New Jersey Business Action Center’s Helpline is now available from 8:00 am – 9:00 pm, seven days a week. Call 1-800- JERSEY-7 to address any concerns you or your employees have.
US Small Business Administration Business Information
The USSBA has approved lending programs for the current crisis and will be opening up their website for new applications! A good source of information:
Small Business Guidance Loan Resources https://www.sba.gov/page/coronavirus-covid-19-small-business-guidance-loan- resources
SBA hotline number 800-659-2955.
Applicants may apply online, receive additional disaster assistance information, and download applications at: https://disasterloan.sba.gov/ela.
Applicants may also call SBA’s Customer Service Center at (800) 659-2955 or email [email protected] for more information on SBA disaster assistance.
Additional funding for business has been approved by the US Congress. Please note brief summary below:
Paycheck Protection Program Paycheck Protection Program Applications Re-opens on April 27, 2020
Paycheck Protection Program and Health Care Enhancement Act UPDATE Courtesy of Sheryl Paynter, USSBA
The ‘‘Paycheck Protection Program and Health Care Enhancement Act’’ was passed by the House of Representatives on April 23, 2020. President Trump executed the Act on April 24, 2020.
The Small Business Administration will resume accepting PPP loan applications on Monday, April 27 at 10:30 AM EDT from approved lenders on behalf of any eligible borrower.
What is contained in the bill: PPP loan program: $320 billion to revive the program, which offers loans to small businesses that can be forgiven by the government if at least 75% of the money goes to keeping employees on the payroll. Of those funds, $60 billion “will be set aside for community-based lenders, smaller banks and credit unions to assist smaller businesses that do not have established relationships with big banks and had a harder time accessing the funds in the first round of loans.” The bill “allocates $30 billion in loans to be issued exclusively by federally insured banks and credit unions with assets between $10 and $50 billion, and another $30 billion in loans to be issued by firms with less than $10 billion in assets.” The SBA “is still working through exactly how to separate out the $60 billion it guaranteed to smaller lenders”. The Treasury Department has issued new guidelines for PPP participants aimed at discouraging larger public companies from applying to the program. The guidelines “make clear that the certification of economic harm required for each application must take into account a company’s ability to secure financing through more traditional means” and allows companies who erred in applying during the first round of PPP, the chance to repay the money by May 7.
A list of participating lenders in PPP has been posted by state: https://www.sba.gov/document/support--paycheck-protection-program- participating-lenders
The Paycheck Protection Program (PPP) is designed to provide the necessary cash flow to give employers the ability to maintain their payroll during this current crisis.
The interest rate on the PPP is 1%. Can borrow up to $10,000,000. Amortization Period: 2 years Does not need to demonstrate ability to repay or have collateral.
The FAQ for PPP loans was updated: https://home.treasury.gov/system/files/136/Paycheck-Protection-Program- Frequently-Asked-Questions.pdf
When to Apply Program re-started April 27, 2020
Additional Resources
The link below can be used to reference what businesses are ineligible. https://www.ecfr.gov/cgi- bin/retrieveECFR?gp=1&SID=7ae95095f7555819d3fcebd099b978e9&ty=HTML& h=L&mc=true&r=SUBJGRP&n=sg13.1.120_1105.sg3 For additional information from the Treasury, including sample applications https://home.treasury.gov/cares For more information on the PPP, who can apply and how, visit Sax’s COVID-19 Resource Center https://www.saxllp.com/covid-19-resource-center/ https://home.treasury.gov/policy-issues/top-priorities/cares-act/assistance-for- small-businesses
The Paycheck Protection Program (https://www.sba.gov/funding- programs/loans/coronavirus-relief-options/paycheck-protection-program-ppp) prioritizes millions of Americans employed by small businesses by authorizing up to $349 billion toward job retention and certain other expenses.
The Paycheck Protection Program provides small businesses with funds to pay up to 8 weeks of payroll costs including benefits. Funds can also be used to pay interest on mortgages, rent, and utilities.
Small businesses employing 500 or less and eligible nonprofit organizations, Veterans organizations, and Tribal businesses described in the Small Business Act, as well as individuals who are self-employed or are independent contractors, are eligible if they also meet program size standards.
Under this program: Eligible recipients may qualify for a loan up to $10 million determined by 8 weeks of prior average payroll plus an additional 25% of that amount. Loan payments will be deferred for six months. If you maintain your workforce, SBA will forgive the portion of the loan proceeds that are used to cover the first 8 weeks of payroll and certain other expenses following loan origination.
Funds are provided in the form of loans that will be fully forgiven when used for payroll costs, interest on mortgages, rent, and utilities (due to likely high subscription, at least 75% of the forgiven amount must have been used for payroll). Loan payments will also be deferred for six months. No collateral or personal guarantees are required. Neither the government nor lenders will charge small businesses any fees.
You can apply through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program. You should consult with your local lender as to whether it is participating. All loans will have the same terms regardless of lender or borrower.
Applications: https://home.treasury.gov/system/files/136/Paycheck-Protection- Program-Application-3-30-2020-v3.pdf
Instructions: https://home.treasury.gov/system/files/136/PPP%20Borrower%20Information%20Fact% 20Sheet.pdf
Update on PPP2 Lending in the US:
Total approved loans for PPP2 - Over 960,000 Total amount approved for PPP2 - almost $90 billion dollars Over 5,300 lenders participating.
Small Banks: Under $10 billion in Assets lead the way in LOANS and DOLLARS: Over 587,000 loans which is about 61% of the loan volume. Over $43 billion for small businesses.
Medium Banks: (between 10 and 50 billion in assets) Over 206,000 loans for over $20 billion dollars.
Large Banks: (over $50 billion in assets) Over 167,000 loans for over $25 billion dollars.
Economic Injury Disaster Loans and Loan Advance The SBA is now processing EIDL loans!
Economic Injury Disaster Loan https://covid19relief.sba.gov/#/ In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000. Applications opened April 13, 2020.
The SBA’s Economic Injury Disaster Loan program provides small businesses with working capital loans of up to $2 million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing. The loan advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue. Funds will be made available within three days of a successful application, and this loan advance will not have to be repaid.
This program is for any small business with less than 500 employees (including sole proprietorships, independent contractors and self-employed persons), private non-profit organization or 501(c)(19) veterans’ organizations affected by COVID-19.
Businesses in certain industries may have more than 500 employees if they meet the SBA’s size standards for those industries.
The Economic Injury Disaster Loan advance funds will be made available within days of a successful application, and this loan advance will not have to be repaid.
The interest rate on the EIDL: For Profits: 3.75% Non-Profits: 2.75% Can borrow up to $2,000,000. Amortization Period: 30 years Does need to demonstrate ability to repay and have collateral. Personal guarantees required. Apply through your bank or visit: https://covid19relief.sba.gov/#/
SBA Debt Relief Program The SBA Debt Relief program will provide a reprieve to small businesses as they overcome the challenges created by this health crisis.
Under this program:
The SBA will also pay the principal and interest of new 7(a) loans issued prior to September 27, 2020. The SBA will pay the principal and interest of current 7(a) loans for a period of six months.
SBA Express Bridge Loans Express Bridge Loan Pilot Program allows small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 with less paperwork. These loans can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing and can be a term loans or used to bridge the gap while applying for a direct SBA Economic Injury Disaster loan. If a small business has an urgent need for cash while waiting for decision and disbursement on
Economic Injury Disaster Loan, they may qualify for an SBA Express Disaster Bridge Loan.
Terms Up to $25,000 Fast turnaround Will be repaid in full or in part by proceeds from the EIDL loan
Common Issues Small Businesses May Encounter:
Capital Access – Incidents can strain a small business's financial capacity to make payroll, maintain inventory and respond to market fluctuations (both sudden drops and surges in demand). Businesses should prepare by exploring and testing their capital access options so they have what they need when they need it. See SBA’s capital access resources. Workforce Capacity – Incidents have just as much impact on your workers as they do your clientele. It’s critical to ensure they have the ability to fulfill their duties while protected. Inventory and Supply Chain Shortfalls – While the possibility could be remote, it is a prudent preparedness measure to ensure you have either adequate supplies of inventory for a sustained period and/or diversify your distributor sources in the event one supplier cannot meet an order request. Facility Remediation/Clean-up Costs – Depending on the incident, there may be a need to enhance the protection of customers and staff by increasing the frequency and intensity by which your business conducts cleaning of surfaces frequently touched by occupants and visitors. Check your maintenance contracts and supplies of cleaning materials to ensure they can meet increases in demand. Insurance Coverage Issues – Many businesses have business interruption insurance; Now is the time to contact your insurance agent to review your policy to understand precisely what you are and are not covered for in the event of an extended incident. Changing Market Demand – Depending on the incident, there may be access controls or movement restrictions established which can impede your customers from reaching your business. Additionally, there may be public concerns about public exposure to an incident and they may decide not to go to your business out of concern of exposing themselves to greater risk. SBA’s Resources Partners and District Offices have trained experts who can help you craft a plan specific to your situation to help navigate any rapid changes in demand. Marketing – It’s critical to communicate openly with your customers about the status of your operations, what protective measures you’ve implemented, and how they (as customers) will be protected when they visit your business. Promotions may also help incentivize customers who may be reluctant to patronize your business. Plan – As a business, bring your staff together and prepare a plan for what you will do if the incident worsens or improves. It’s also helpful to conduct a tabletop exercise to simulate potential scenarios and how your business management and staff might respond to the hypothetical scenario in the exercise. For examples of tabletop exercises, visit FEMA’s website at: https://www.fema.gov/emergency- planning-exercises
SBA Products and Resources Access to Capital SBA provides a number of loan resources for small businesses to utilize when operating their business. For more information on loans or how to connect with a lender, visit: https://www.sba.gov/funding-programs/loans.
Current Express and additional lenders in NJ: st 1 Colonial Community Bank st 1 Constitution Bank BCB Community Bank Columbia Bank Cross River Bank Crown Bank Financial Resources FCU First Bank First Commerce Bank Fulton Bank Kearny Bank Lakeland Bank Magyar Bank Manasquan Bank M&T New Millennium Bank Parke Bank Peapack-Gladstone Bank PNC Provident Bank Regal Bank Santander Bank Sturdy Savings Bank TD Bank The First National Bank of Elmer Unity Bank Wells Fargo Freehold Bank Crest Savings Bank 1st Bank of Sea Isle City United Roosevelt Savings Bank First National Bank of Absecon Pinnacle Federal Credit Union
Any Questions, please call or email your Local Lender Relations Specialist:
Claudia Yarborough / LRS: [email protected] or 973-645-3572 covers North Bergen, Essex, Hudson, Morris, Passaic, Sussex, and Union Counties
Additional SBA Links to visit:
Link to the SBA PPP website - https://www.sba.gov/funding- programs/loans/coronavirus-relief-options/paycheck-protection-program-ppp
Link to Treasury PPP website - https://home.treasury.gov/policy-issues/top- priorities/cares-act/assistance-for-small-businesses
Update to Treasury FAQ: https://home.treasury.gov/system/files/136/Paycheck- Protection-Program-Frequently-Asked-Questions.pdf https://www.sba.gov/disaster-assistance/coronavirus-covid-19 https://disasterloan.sba.gov/ela/Documents/Three_Step_Process_SBA_Disaster_Loans .pdf https://disasterloan.sba.gov/ela/Documents/SBA-Disaster-Assistance-Loans- Businesses-Nonprofits.pdf
Press Release from the US Treasury – April 9, 2020 Federal Reserve takes additional actions to provide up to $2.3 trillion in loans to support the economy The Federal Reserve on Thursday, April 9, 2020 took additional actions to provide up to $2.3 trillion in loans to support the economy. This funding will assist households and employers of all sizes and bolster the ability of state and local governments to deliver critical services during the coronavirus pandemic.
"Our country's highest priority must be to address this public health crisis, providing care for the ill and limiting the further spread of the virus," said Federal Reserve Board Chair Jerome H. Powell. "The Fed's role is to provide as much relief and stability as we can during this period of constrained economic activity, and our actions today will help ensure that the eventual recovery is as vigorous as possible."
The Federal Reserve's role is guided by its mandate from Congress to promote maximum employment and stable prices, along with its responsibilities to promote the stability of the financial system. In support of these goals, the Federal Reserve is using its full range of authorities to provide powerful support for the flow of credit in the economy.
The actions the Federal Reserve is taking today to support employers of all sizes and communities across the country will:
Bolster the effectiveness of the Small Business Administration's Paycheck Protection Program (PPP) by supplying liquidity to participating financial institutions through term financing backed by PPP loans to small businesses. The PPP provides loans to small businesses so that they can keep their workers on the payroll. The Paycheck Protection Program Liquidity Facility (PPPLF) will extend credit to eligible financial institutions that originate PPP loans, taking the loans as collateral at face value; Ensure credit flows to small and mid-sized businesses with the purchase of up to $600 billion in loans through the Main Street Lending Program. The Department of the Treasury, using funding from the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) will provide $75 billion in equity to the facility; Increase the flow of credit to households and businesses through capital markets, by expanding the size and scope of the Primary and Secondary Market Corporate Credit Facilities (PMCCF and SMCCF) as well as the Term Asset-Backed Securities Loan Facility (TALF). These three programs will now support up to $850 billion in credit backed by $85 billion in credit protection provided by the Treasury; and Help state and local governments manage cash flow stresses caused by the coronavirus pandemic by establishing a Municipal Liquidity Facility that will offer up to $500 billion in lending to states and municipalities. The Treasury will provide $35 billion of credit protection to the Federal Reserve for the Municipal Liquidity Facility using funds appropriated by the CARES Act.
The Main Street Lending Program will enhance support for small and mid-sized businesses that were in good financial standing before the crisis by offering 4-year loans to companies employing up to 10,000 workers or with revenues of less than $2.5 billion. Principal and interest payments will be deferred for one year. Eligible banks may originate new Main Street loans or use Main Street loans to increase the size of existing loans to businesses. Banks will retain a 5 percent share, selling the remaining 95 percent to the Main Street facility, which will purchase up to $600 billion of loans. Firms seeking Main Street loans must commit to make reasonable efforts to maintain payroll and retain workers. Borrowers must also follow compensation, stock repurchase, and dividend restrictions that apply to direct loan programs under the CARES Act. Firms that have taken advantage of the PPP may also take out Main Street loans.
The Federal Reserve and the Treasury recognize that businesses vary widely in their financing needs, particularly at this time, and, as the program is being finalized, will continue to seek input from lenders, borrowers, and other stakeholders to make sure the program supports the economy as effectively and efficiently as possible while also safeguarding taxpayer funds. Comments may be sent to the feedback form until April 16.
To support further credit flow to households and businesses, the Federal Reserve will broaden the range of assets that are eligible collateral for TALF. As detailed in an updated term sheet, TALF-eligible collateral will now include the triple-A rated tranches of both outstanding commercial mortgage-backed securities and newly issued collateralized loan obligations. The size of the facility will remain $100 billion, and TALF will continue to support the issuance of asset-backed securities that fund a wide range of lending, including student loans, auto loans, and credit card loans.
The Municipal Liquidity Facility will help state and local governments better manage cash flow pressures in order to continue to serve households and businesses in their communities. The facility will purchase up to $500 billion of short term notes directly from U.S. states (including the District of Columbia), U.S. counties with a population of at least two million residents, and U.S. cities with a population of at least one million residents. Eligible state-level issuers may use the proceeds to support additional counties and cities. In addition to the actions described above, the Federal Reserve will continue to closely monitor conditions in the primary and secondary markets for municipal securities and will evaluate whether additional measures are needed to support the flow of credit and liquidity to state and local governments.
All of the facilities mentioned above are established by the Federal Reserve under the authority of Section 13(3) of the Federal Reserve Act, with approval of the Treasury Secretary.
The Federal Reserve remains committed to using its full range of tools to support the flow of credit to households and businesses to counter the economic impact of the coronavirus pandemic and promote a swift recovery once the disruptions abate.
Term Sheet: Term Asset-Backed Securities Loan Facility (PDF) Term Sheet: Primary Market Corporate Credit Facility (PDF) Term Sheet: Secondary Market Corporate Credit Facility (PDF) Term Sheet: Municipal Liquidity Facility (PDF) Term Sheet: Paycheck Protection Program Lending Facility (PDF)
Main Street Lending Program Term Sheet: Main Street New Loan Facility (PDF) Term Sheet: Main Street Expanded Loan Facility (PDF)
Private Sector Programs to Assist Companies
Bank Assistance Information Several banks have set-up contact lines to work with individuals impacted by COVID- 19. If a bank is not listed below, reach out to them To find out what they are doing to assist those affected by COVID-19.
The Federal Deposit Insurance Corporation (FDIC) and the (National Credit Union Administration (NCUA) have also put out information For bankers and consumers.
FDIC: https://www.fdic.gov/coronavirus/index.html NCUA: https://www.ncua.gov/
Other banks assisting during COVID-19: Bank of America: https://about.bankofamerica.com/promo/assistance/latest- updates-from-bank-of-america-coronavirus Capitol One: https://www.capitalone.com/coronavirus/ Chase: https://www.chase.com/digital/resources/coronavirus Citibank: https://online.citi.com/US/JRS/pands/detail.do?ID=covid19 Discover: https://www.discover.com/coronavirus/ PNC: https://www.pnc.com/en/customer-service/coronavirus-update.html US Bank: https://www.usbank.com/splash/covid-19.html Wells Fargo: https://newsroom.wf.com/press-release/corporate-social- responsibility/wells-fargo-donates-625-million-aidcoronavirus
JPMorgan Chase Makes $50 Million Philanthropic Investment to Help Address Immediate and Long-Term Impacts of COVID-19 https://www.jpmorganchase.com/corporate/news/pr/jpmc-makes-50mm-philanthropic- investment-to-address-impacts-of-covid-19.htm?_lrsc=6be0d6ff-beb2-4ec2-8a8d- d6e91dc8b469&source=linkedinelevate
Note article below about other bank support for the business community: https://www.forbes.com/sites/advisor/2020/03/12/list-of-banks-offering-relief-to- customers-affected-by-coronavirus/#1139a1353ee3
Call to Action
The Passaic County Division of Economic Development is reaching out to all companies who can manufacture masks, gowns, hand sanitizers and ventilators as needed by our health care providers. We already have companies manufacturing these products in Passaic County – THANK YOU! Please email Deborah Hoffman: [email protected] if you would like to participate and we will link you with the appropriate federal and state contacts.
Department of Labor and Workforce Development – State of NJ State of New Jersey COVID-19 Jobs and Hiring Portal
A new site has been set up by the Governor's Office to help share information with the public regarding the current situation. The "Jobs Portal" shows opportunities for employment, and the data comes from the employers themselves. This can be a good resource for NJ LWD, One-stop’s, Workforce Development Board’s, College staff, businesses, or for anyone who may have been displaced to find a new opportunity. https://jobs.covid19.nj.gov/
State of New Jersey COVID-19 Jobs and Hiring Portal. The State of New Jersey has developed a centralized resource to match talent with opportunities in industries on the front lines of serving New Jersians during the outbreak. http://jobs.covid19.nj.gov.
Please visit the link below for important information on Sick Leave benefits for your employees and business compensation. https://www.nj.gov/labor/employer-services/business/covid.shtml
Self-Employed NJ Workers: Unemployment Benefits During the Coronavirus Emergency Assistance is available to self-employed workers, independent contractors, gig and platform workers who are impacted by COVID-19 through Pandemic Unemployment Assistance (PUA) and possibly the Families First Coronavirus Response Act (FFCRA). The NJ Department of Labor has prepared two downloadable guides to help you understand what benefits are available and how to apply for them. If you are a self-employed worker, independent contractor, gig and platform worker please read them both before applying for Unemployment Insurance benefits.
Visit the following link: https://myunemployment.nj.gov/labor/myunemployment/independentcontractors. shtml
Governor Murphy Names Members of Council to Restore Recovery George Helmy, Chief of Staff to the Governor Dr. Richard Besser, President and CEO of the Robert Wood Johnson Foundation and former Acting Director of the Centers for Disease Control and Prevention (CDC) Jeh Johnson, former United States Secretary of Homeland Security under President Barack Obama
The NJMEP has developed the COVID-19 Return to Work & Recovery Guide
This complimentary guide offers a mitigation plan to help businesses manage a post- COVID-19 environment. You will find disinfection protocol, self-distancing strategies and tips, a Return to Work (RTW) Contingency Plan Checklist, and more actionable information for manufacturers and logistics companies. Start off on the right foot as the economy begins to reopen.
Download Your Copy, Today!: https://www.njmep.org/download/return-recovery2020/
Business Counseling and Resources
Passaic County Division of Economic Development Deborah Hoffman Mobile: 201-738-3039 [email protected] www.passaiccountynj.org
William Paterson University Small Business Development Center Kathleen Muldoon, Executive Director [email protected] www.sbdcwpu.com
FREE SEMINARS OFFERED BY NJBIA
Virtual Town Hall: Speaker Craig J. Coughlin Webcast Wednesday, May 6 9:00am
REGISTER NOW: https://register.gotowebinar.com/register/6381825378752488208
Join NJBIA and The New Jersey Chamber of Commerce for a virtual town hall with Speaker Craig J. Coughlin, New Jersey General Assembly.
Following Speaker Coughlin, there will be a live Q&A session.
FREE WEBINARS OFFERED BY NJBIA
Latest IRS and DOL Guidance on New COBRA Deadlines Webinar Tuesday, May 5 2:00pm
REGISTER NOW: https://zoom.us/webinar/register/WN_m6YA12kISsWLHGXjcwjKqA The Office of Compliant Administration will be hosting a webinar to address new IRS and Department of Labor guidelines and what impact it has on the insurer, insured, employer, and OCA.
Virtual Town Hall: Speaker Craig J. Coughlin Webcast Wednesday, May 6 9:00am
REGISTER NOW: https://register.gotowebinar.com/register/6381825378752488208 Join NJBIA and the New Jersey Chamber of Commerce for a virtual town hall with Speaker Craig J. Coughlin, New Jersey General Assembly.
Following Speaker Coughlin, there will be a live Q&A session.
Wealth Planning in the Midst of a Global Pandemic Webcast Friday, May 8 11:30am
REGISTER NOW: https://register.gotowebinar.com/register/3091195984246568976 During this webinar, you will learn what your tax considerations are now that the 20% QBI, SECURE Act, and CARES Act are in effect.
In addition, the following will be discussed: Shielding assets from creditors by building a protection plan and properly structuring your business Saving for retirement while considering factors like creditors and design options Planning for succession with a focus on tax efficiency