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Small Business Relief Programs relative to the COVID-19 Pandemic

Small Business Relief Programs relative to the COVID-19 Pandemic

UPDATED AS OF: MARCH 26, 2020

PIDA is making emergency relief loans up to $100,000 available to qualifying small businesses with 100 or fewer employees at a 0% interest rate and term for 3 years.  The new program is called the COVID-19 Working Capital Access Program (CWCA)

The website will be up and running soon and will be available here:  https://dced.pa.gov/programs/covid-19-working-capital-access-program-cwca/

All loan apps must be submitted through a Certified Economic Development Organization (CEDO), which can be found at www.dced.pa.gov/cedo.

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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 Small Business Administration has developed a website to provide information on how businesses can apply for a low-interest loan to help in these difficult economic times. Click here to apply. 

These loans carry an interest rate of 3.75% for small businesses and 2.75% for nonprofits.  Loan repayment terms vary by applicant, up to a maximum of 30 years.  You can use the loan to cover accounts payable, debts, payroll and other bills the coronavirus has affected your ability to pay. When you apply online, you’ll need to select “Economic Injury” as the reason you’re seeking assistance.  You’ll also need to supply documentation such as the business’s most recent tax returns, a personal financial statement and a schedule of liabilities that lists all your current debts. There are size standards that the SBA has identified by North American Industry Classification System (NAICS) codes.  Click here to determine if your business is within their parameters.  The SBA Disaster Assistance Customer Service Center (1-800-659-2955) can help you with your application.

The Pennsylvania Commonwealth Financing Authority (CFA) might be an option for some PA businesses. Over $60 million of loans will be available to businesses with 100 or fewer full-time employees.  Loans of up to $100,000 will be available to use as working capital and the interest rates are being dropped to 0%. This new program is called the COVID-19 Working Capital Access Program (CWCA). The website will be up and running soon and will be available here. All loan applications must be submitted through a Certified Economic Development Organization (CEDO), which can be found here. Please note that these loans are approved on first-come, first served basis.

The New Jersey Economic Development Authority (NJEDA) has multiple loan, financing and technical assistance programs which can be found here. You can contact a NJEDA team member at 609-858-6767 to discuss what resources may be available to address your business needs. (No specific information related to COVID-19 is currently available.  NJ advises to check back later, as they anticipate an update soon.)

If your business is in the City of Philadelphia, the Philadelphia COVID-19 Small Business Relief Fund includes the following three programs that you can apply for through a single application.  A Microenterprise Grant offers a $5,000 grant to eligible businesses with annual revenue under $500,000.  You’ll need a signed tax return to confirm annual revenue and a description of the impact of COVID-19 on your business as well as a recovery plan.  A Small Biz Grant offers up to a $25,000 grant (amount determined by review of application) to eligible businesses with annual revenue between $500,000 to $3 million.  You’ll need a signed tax return, 2019 financial statements, verification of cash flow needs, proof of insurance and a description of the impact of COVID-19 on your business as well as a recovery plan. A Small Biz Zero-Interest Loan offers a $25,000 to $100,000 loan (amount determined by review of application) to eligible businesses with annual revenue between $3 - $5 million.  You will also need a signed tax return, 2019 financial statements, verification of cash flow needs, proof of insurance, and a description of the impact of COVID-19 on your business as well as a recovery plan. There are no collateral requirements for the loan. More information can be found here.

If your business is in the Pittsburgh area, the Urban Redevelopment Authority of Pittsburgh (URA) may be a source of assistance. 

URA is taking the following steps:

  • Halting ALL loan payments for URA small business borrowers, including automatic loan payment withdraws from borrowers’ accounts, for the month of April 2020.
  • Offering to its existing small business borrowers Emergency Extended Credit to help ease potential cash flow difficulties over the next several weeks. Borrowers can apply for up to an additional $15,000 with no fees, at 0% and with repayment terms 36 months, the first 6 of which there would be no payments due. Applicants should contact their URA loan officer, provide a statement of need for additional credit and provide the previous 1-month cash flow statement.
  • The URA is temporarily easing and streamlining its Micro-Enterprise Loan Program to support up to 30, 0% loans for small businesses that are not currently URA borrowers. Borrowers can apply for up to $15,000 (to be used for rent, payroll and other approved monthly business expenses) with no fees, at 0% and with repayment terms 36 months, the first 6 of which there would be no payments due.

Applicants should apply here, provide a statement of need, and provide the previous year’s financial statements (including cash flow statement).

Article compiled by Keith R. Hoffman. For additional information contact us at info@herbein.com

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Herbein is responding to the COVID-19 (Coronavirus) pandemic with our Coronavirus Resource Center, which provides regularly updated information, answers to frequently asked questions and other resources to help during this global health crisis. Continue to check back for more updates in the coming weeks.

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