SBA Disaster Assistance in Response to the Coronavirus in Alabama - Pending
Many have been asking about the SBA's Disaster Assistance Loan Program. Here is what we know. The Federal Emergency Declaration last week activated the SBA's Economic Injury Disaster Loan program (EIDL). We are working with the Governor’s office and AL Department of Commerce to ensure that the entire state is covered under any disaster declaration.
Governor Kay Ivey, the AL Department of Commerce, Alabama SBDC, and SBA’s District Office (in Birmingham) have compiled the documentation required to allow the Governor to submit an Economic Injury Disaster Loan assistance declaration to the US Small Business Administration. The request for negative impact data that was sent on Tuesday has concluded; no additional responses are required.
The request was submitted to SBA Tuesday evening.Upon receipt of the request from the Governor, SBA will issue an Economic Injury Disaster Loan declaration; it can take up to 24 hours for SBA to activate the EIDL application portal for an approved state.Until that happens, companies in Alabama cannot apply for the SBA Economic Injury Disaster Loan.
When approved - and that could be as early as Wednesday evening,Alabama’s Small Businesses will be able to go to SBA.gov and make a request for an Economic Injury Disaster Loan (EIDL) online.https://www.sba.gov/funding-programs/disaster-assistance
Last Update: 18 March 2020, 11AM
For additional information, please contact the SBA disaster assistance customer service center.
Call 1-800-659-2955 (TTY: 1-800-877-8339) or e-maildisastercustomerservice@sba.gov.
What can you do in the meantime?
We encourage our clients to begin capturing business financial information related to year to year (and YTD compared to prior year YTD) income statement and cash flow changes. We encourage them to bring together tax related documentation from the past 3 years, both personal and business, and to begin assembling the documentation that will be required for a loan. Companies should also connect with their lending institutions to see what programs their bank/credit unions are offering during this time (delaying payment requirements/interest only payments) and vendor payments on account.
SBA Disaster Assistance in Response to the Coronavirus
·The U.S. Small Business Administration is offering designated states and territories low-interest federal disaster loans for working capital to small businesses suffering substantial economic injury as a result of the Coronavirus (COVID-19). Upon a request received from a state’s or territory’s Governor, SBA will issue under its own authority, as provided by the Coronavirus Preparedness and Response Supplemental Appropriations Act that was recently signed by the President, an Economic Injury Disaster Loan declaration.
·Any such Economic Injury Disaster Loan assistance declaration issued by the SBA makes loans available to small businesses and private, non-profit organizations in designated areas of a state or territory to help alleviate economic injury caused by the Coronavirus (COVID-19).
·SBA’s Office of Disaster Assistance will coordinate with the state’s or territory’s Governor to submit the request for Economic Injury Disaster Loan assistance.
·Once a declaration is made for designated areas within a state, the information on the application process for Economic Injury Disaster Loan assistance will be made available to all affected communities as well as updated on our website:SBA.gov/disaster.
·SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance per small business and can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.
·These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses without credit available elsewhere; businesses with credit available elsewhere are not eligible. The interest rate for non-profits is 2.75%.
·SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.
·SBA’s Economic Injury Disaster Loans are just one piece of the expanded focus of the federal government’s coordinated response, and the SBA is strongly committed to providing the most effective and customer-focused response possible.
·For additional information, please contact the SBA disaster assistance customer service center.Call 1-800-659-2955 (TTY: 1-800-877-8339) or e-maildisastercustomerservice@sba.gov.
·VisitSBA.gov/disasterfor more information.