On December 21st, Congress passed a new COVID-19 economic stimulus bill that is currently awaiting the President’s signature. After the bill is signed into law by the President, the Treasury and the Small Business Administration will have 10 days to implement the amended law. As we head into the Holiday season, this can delay the process. At this time, the bill language is not yet available, but lawmakers have released some details that are subject to change. As we await further guidance here is what we know so far:
- Authorized $325 Billion for PPP, EIDL and other small business assistance.
- Eligible borrowers
- Fewer than 300 employees
- Must have a reduction in quarterly revenues of at least 25% compared to the same quarter in 2019
- Stock not traded on the National Exchange
- 501 (c) (6) are eligible, but any Entity for which lobbying comprises more than 15% of receipts or activities in not eligible.
- Maximum loan – 2.5 times average monthly payroll or $2 Million, whichever is less. Businesses in restaurant and hospitality industries are eligible for loan for 3.5 times average of monthly payroll.
- Interest rate as term 1% 5 years
- Eligible Expenses – The Bill expands the eligible expenses to include PPE expense, costs associated with outdoor dining and supply costs, but payroll expenses must still comprise no less than 60 percent of eligible expenses.
Empire State Bank will continue to closely monitor developments and provide you with updates and will notify you via email once we begin to accept applications under the new program.