Financial Help for Contractors
The Federal Coronavirus Aid, Relief, and Economic Security (CARES) Act includes $367 billion in loans -- which can be forgiven -- to small business to help with payroll issues.
Small business can apply for low-interest Economic Injury Disaster Loans of up to $2 million to overcome a loss of revenue due to COVID-19. They can request an advance of $10,000 to be delivered within three days of the application. The advance must be used to:
- Provide sick leave to employees unable to work due to the effects of COVID-19;
- Maintain payroll to retain employees;
- Cover increased costs of materials due to interrupted supply chains;
- Make rent or mortgage payments; or
- Repay other obligations that cannot be met due to revenue losses.
The applicant may eligible for forgiveness of the advance and loan if used for these purposes.Apply at: https://disasterloan.sba.gov/ela/
Businesses with fewer than 500 employees can also apply for the Paycheck Protection program, an expansion of the SBA's 7(a) loan program. These loans are provided through SBA-approved lenders. They can be used for:
- Payroll costs;
- Certain costs related to the continuation of group health care benefits;
- Employee salaries (including commissions);
- Mortgage, rent and utilities payments; and
- Interest on any other debt obligations that were incurred before the covered period.
Loan recipients may be eligible for forgiveness on a loan used for payroll, mortgage and rent obligations, and utility payments.
More information is available here: https://www.sba.gov/funding-programs/loans/paycheck-protection-program
Please consult a financial adviser about the details of these programs.