Zoom
SBA state director Catherine Marx.
Local small businesses can take another crack at landing Covid emergency relief starting Tuesday, as the federal government rolls out a second phase of the Paycheck Protection Program (PPP).
The beginning of PPP, Part 2 was at the center of a 45-minute virtual webinar hosted on Zoom and Facebook Live Tuesday afternoon by the Greater New Haven Chamber of Commerce.
The chamber’s executive director, Garrett Sheehan, talked through what has changed, what has stayed the same, and who’s eligible for the small business forgivable loan program, along with Lt. Gov. Susan Bysiewicz, state economic development Deputy Commission Glendowlyn Thomas, and federal Small Business Administration Director for Connecticut Catherine Marx.
“There are a lot of acronyms, but there’s money there,” Marx said about the refilled PPP and an alphabet soup of other state and federal business relief programs, including Emergency Injury Disaster Loans (EIDL), the Shuttered Venue Operators Grants (SVOG), and the CT CARES Small Business Grant Program.
Greater New Haven Chamber of Commerce ED Garrett Sheehan.
In December, Congress included $284 billion for a second round of PPP as part of a $900 billion Covid relief bill. As part of the first wave of PPP loans distributed in the months after last March’s CARES Act, the SBA made a total of 64,629 PPP loans worth over $6.7 billion in Connecticut.
Below are a few highlights from the webinar, which can be watched in full below. Click here for a full FAQ on the renewed program:
• Who is eligible? Marx said that the new round of PPP is open to small businesses that received a forgivable loan through the first round of PPP, as well as to those applying for the first time or that were denied the last time around.
First-time applicants can be no larger than 500 employees, while second-time applicants must be no larger than 300 employees. While the first official day that prospective borrowers can apply for forgivable loans is Tuesday, smaller lenders that targeted “underserved minority-owned populations, women-owned businesses, and veteran-owned businesses” were allowed to start taking applications last week, Marx said. One of the biggest criticisms of the first round of PPP, locally and across the country, was that not enough small, minority-owned businesses were able to secure forgivable loans—in large part because of lack of connections to big banks, experienced lawyers, and financial advisers.
She also said that “second draw” applicants — that is, those who received a PPP forgivable loan last time around, and are applying again — must show that they suffered a 25 percent reduction in revenue in comparable quarters between 2019 and 2020. And they must show that they’ve used up all of their first-round PPP money.
The application deadline for this round of PPP is March 31.
State economic development Deputy Commission Glendowlyn Thomas
• How big of a forgivable loan can a business receive? Marx said that “first draw” applicants are eligible for 2.5 times their average monthly payroll cost, with a max of $10 million, while “second draw” applicants are limited to no more than $2 million.
• Do you have to pay the money back? “It is still a forgivable loan program,” Marx said. “If you use the money properly, you will get it 100 percent forgiven.” “Properly,” in the context of PPP 2.0, means spending at least 60 percent on workers and the rest on such qualifying expenses as rent, utilities, and mortgage interest payments, among other expenses. “We’re trying to make that forgiveness process easier by making the forms simpler,” she added.
Lt. Gov. Bysiewicz.
• How do you apply? “If you’ve already applied for a PPP loan, you can give your bank a call to make sure they are providing” this second round, too, Bysiewicz said. If you need help filling out the application, she said, reach out to the Women’s Business Development Council, the Connecticut Small Business Development Center, the Spanish American Merchants Association (SAMA), or the Black Business Alliance. She said those organizations have people who will help business owners fill out their forms for free.
“Don’t do this alone,” Marx said. “We have resource partners that are there to help.”
Click on the Facebook Live video below to watch the full webinar.
This was billed as a "[i]State[/i] and Federal Aid" webinar, but they really glossed over the "State" part. And rightly so, because despite the state's extremely strong tax returns & budgetary position, CT has done a truly miserable job at helping hard-hit businesses make it through the pandemic -- [i]especially[/i] the small businesses with the least resources to survive.
Quick recap on CT state aid (grants, not debt):
Here are some reference points for small business state/local aid we've received at our similarly sized sister venues, which all saw a >50% revenue drop and furloughs in 2020:
And I just heard from a friend who runs a similarly sized venue in our industry in New Hampshire; she got a $72,000 state formula grant.
So maybe the DECD and Lamont should stop patting themselves on the back and start using that Strong Budgetary Position to make sure that once the vaccines have been distributed, there are still businesses & jobs left to come back to?
Just a thought.