In response to the COVID-19 pandemic, federal, state, and local governments, through both legislative and executive action, have enacted or ordered a broad array of financial measures to mitigate the adverse economic effects experienced by businesses and nonprofit entities.
Stated below are the economic programs established by the federal government, New York State, and New York City to help ameliorate the financial effects of COVID-19.
1. Federal Economic Aid Programs – as more fully described in our earlier Alert (note for the moment these funds are tapped OUT):
a. U.S. Small Business Administration (“SBA”) Economic Injury Disaster Loans (“EIDL”) and Loan Advance
i. Summary: Small business owners with less than five hundred (500) employees currently experiencing a temporary loss of revenue due to COVID-19 are eligible to apply for the EIDL loan to pay immediate expenses such as payroll, bills/accounts payable, and fixed debts. ii. Loan Amount: Up to $2 million. iii. Loan Advance Amount: Up to $10,000. vi. Source: https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/economic-injury-disaster-loan-emergency-advance
b. U.S. SBA Paycheck Protection Program
i. Summary: To provide a low-interest, no fee loan for small businesses, nonprofits, and sole proprietors to help retain employees and aid cash flow. ii. Loan Amount: Up to $10 million. iii. Additional Notes: The SBA will forgive the loan if all employees are kept on the payroll for eight (8) weeks and the money is used for payroll, rent, insurance, paid sick or medical leave, mortgage interest, or utilities. The applying entity must have fewer than five hundred (500) employees. iv. Repayment: Loan repayments will be deferred for six (6) months. v. How to Apply: Applicants can apply through any existing SBA lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that has agreed to participate. vi. Deadline: The Paycheck Protection Program is available through June 30, 2020. vii. Source: https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protection-program-ppp
c. U.S. SBA Express Bridge Loan Pilot Program
i. Summary: To provide temporary financial assistance for businesses awaiting proceeds from the EIDL loan program. ii. Loan Amount: Up to $25,000. iii. Additional Notes: The applicant must have a pre-existing relationship with an SBA Express Lender. The borrower can utilize the loan while it is applying for the EIDL loan. However, the loan must be repaid in full or in part by the proceeds from the EIDL loan. iv. Source: https://www.sba.gov/sites/default/files/2020-03/Express-Bridge-Loan-Pilot-Program-Guide-FINAL-3.25.20.pdf
2. New York State Tax Assistance Programs:
a. Tax Return Extension
i. Summary: New York State personal income tax and corporation tax returns, originally due on April 15, 2020, have been extended to July 15, 2020. Further, all related tax payments due on April 15, 2020 may be deferred to July 15, 2020 without penalties and interest. ii. Source: https://www.tax.ny.gov/press/alerts/nys-tax-response-to-covid-19.htm
b. Penalty and Interest Waiver for Sales Tax Vendors
i. Summary: Sales tax payments and returns were due on March 20, 2020. However, penalty and interest may be waived for quarterly and annual filers who were unable to file or pay on time due to COVID-19. ii. Source: https://www.tax.ny.gov/press/alerts/sales-tax-relief-for-covid-19.htm
3. New York State/City Economic Programs:
a. New York City Employee Retention Grant Program
i. Summary: New York City will provide grants to small businesses with fewer than five (5) employees to cover 40% of payroll costs for two (2) months to help retain employees. ii. Amount: Up to $27,000. iii. Requirement: The business must demonstrate that the COVID-19 outbreak resulted in at least a 25% decrease in revenue. iv. Notice: As of April 3, 2020, the New York City Employee Retention Grant Program stopped accepting applications. v. Source: https://www1.nyc.gov/nycbusiness/article/nyc-employee-retention-grant-program
b. New York City Small Business Continuity Loan Fund
i. Summary: Small businesses located in New York City that employ less than ninety-nine (99) employees can apply for interest-free loans if they have experienced at least a 25% decrease in revenues as a result of COVID-19. ii. Loan Amount: Up to $75,000. iii. Notice: As of April 16, 2020, the New York City Small Business Continuity Loan Fund has stopped accepting applications. iv. Source: https://www1.nyc.gov/site/sbs/businesses/covid19-business-outreach.page
c. Renaissance Economic Development Corporation Emergency Small Business Relief Loan Fund
i. Summary: New York City small businesses with fifty (50) employees or less whose sales have decreased by at least 25% due to COVID-19 can apply for a fixed interest rate loan. ii. Loan Amount: Up to $50,000. iii. Interest Rate: 3% fixed rate. iv. Loan Payment Deferral: Up to six (6) months. v. Term: Up to forty-eight (48) months amortization. vi. Expiration: The application deadline is August 31, 2020. vii. Source: https://renaissance-ny.org/emergency-small-business-relief-loan-fund/
d. Unemployment Insurance Benefit Program
i. Summary: New York State has waived the 7-day waiting period to apply for unemployment insurance benefits for those out of work due to COVID-19 closures or quarantines. ii. Requirements:
1. The applicant must be ready, willing, and able to work; and 2. The applicant must be actively looking for work during each week they are claiming benefits.
iii. Source: https://www.ny.gov/services/get-unemployment-assistance
e. Deferment of Premiums for New York Residents and Small Businesses
i. Summary: New York residents or small businesses who pay life insurance, as well as individual or small group commercial health insurance, property insurance, or casualty insurance premiums may defer premiums and fees for up to ninety (90) days. ii. Source: https://www.governor.ny.gov/news/no-20213-continuing-temporary-suspension-and-modification-laws-relating-disaster-emergency
f. New York State-FuzeHub COVID-19 Manufacturing Grants
i. Summary: Six (6) companies will share a total of $400,000 in grant money to produce N95 masks and manufacture ventilators. The partnership will give four (4) manufacturers $50,000 each to produce N95 masks. The partnership will give two (2) manufacturers $100,000 each to manufacture ventilators. ii. Grant Requirements: In order to apply for the grant, applicants must:
1. Be a New York State small to medium-sized manufacturer; 2. Have at least one (1) physical establishment in New York State, and no more than five hundred (500) employees across the entire firm or enterprise worldwide; 3. Have a North American Industry Classification System code (NAICS) for manufacturing.
iii. Grant Guidelines: https://fuzehub.com/wp-content/uploads/2020/04/COVID-Mfg-Grant-Guidelines-Final.pdf iv. Source: https://fuzehub.com/wp-content/uploads/2020/04/COVID-Mfg-Grant-Guidelines-Final.pdf