Seattle1
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California Small Businesses Struggle While Waiting for Stimulus Aid - Los Angeles
The Paycheck Protection Program (PPP)
This is a forgivable loan of up to $10 million with a 1% interest rate. “The max amount a business can apply for is 2.5x the business’s average monthly payroll costs, not exceeding $10 million. Under specific circumstances, PPP Loans can be forgiven. The amount a business spent on payroll, rent, utilities and other eligible costs within the 8-week period upon receiving the loan is forgiven. The remaining amount turns into a fixed-rate loan with the SBA,” adds Lieberman.
Economic Injury Disaster Loan (EIDL)
Businesses can receive as much as $2 million in assistance from the federal government. This is a fixed-rate loan with a 3.75% interest rate for small businesses and a 2.75% interest rate for private non-profits. “However, applicants are also eligible for a $10,000 forgivable advance on the loan immediately after applying, even if the business does not ultimately receive the loan,” said Rebecca Lieberman, Policy Advisor and Research Manager with the San Diego Regional Chamber of Commerce. The SBA has also stopped processing new EIDL loans, citing a lack of funding.
California COVID-19 Small Business IBank Loan Program
Earlier this month, Gov. Gavin Newsom announced $50 million in loan guarantees for small businesses that may not be eligible for federal relief. The State is also allowing small businesses to defer payment of sales and use taxes of up to $50,000, for up to 12 months. In a move said to help workers and small businesses, people receiving unemployment benefits are temporarily being paid an extra $600 on top of their weekly amount.
California City level COVID-19 Small Business Aid
Small business owners in San Francisco are being encouraged to apply for the San Francisco Hardship Emergency Loan Program (SF HELP). The loans have a 0 percent interest rate and are administered by Main Street Launch in partnership with the city of San Francisco. Small businesses can make loans of up to $50,000 for terms of up to six years.
Additionally, through the City of Los Angeles Small Business Emergency Microloan Program, businesses and microenterprises in Los Angeles that are responsible for providing low-income jobs can apply for emergency microloans in an amount between $5,000 and $20,000. Reese hopes Congress reaches an agreement to fund the loan programs soon and that more applications in the queue are approved. In the meantime, three days a week she and her scaled-down team cook M’dears signature soul food for about 50 seniors who are shut-in during this pandemic.
The emergency meal delivery program was launched by LA City Councilmember Marqueece Harris-Dawson. Reese says compensation for the heartwarming cause has been slow. In fact, on the Friday leading into the Easter holiday weekend, Reese couldn’t afford to pay some of her staff. “Up to today, we have provided 300 meals and haven’t gotten a penny for it,” she said, “You wanted me to keep them on staff to do this, but you’re not giving me the money to pay them, so I can’t pay them.”
The National Restaurant Association has launched RestaurantsAct.com to share the latest COVID-19 relief information.
Only one-fifth of loan applicants have received any money under the federal Paycheck Protection Program (PPP), according to the advocacy group —and unless relief arrives by the end of next month, half expect to go under.
The Senate approved a third economic stimuluspackage on April 21 that includes an additional $310 billion for the PPP to help small businesses. The legislation, which would provide loans of up to $10 million for businesses with 500 or fewer employees, is expected to go to a House vote this week.
“We don’t believe $300 [billion] and some change is enough,” NFIB California Director John Kabateck told The Epoch Times.
“We believe $400 billion would be a more sufficient amount, just to cover the needs that exist right now. And we believe $200 billion ought to be dedicated specifically to businesses with 20 or fewer employees.”
Over 1.6 million applications for aid were approved before the initial funds ran out, according to the Treasury Department.
But even though the program was established to help small businesses, 25 percent of the funds were given to 2 percent of the companies that applied, including big businesses with thousands of employees that took advantage of the program, Kabateck said.
A recent analysis by Morgan Stanley shows that over $243 million of the total went to publicly traded companies.
“We don’t disparage a job creator of any size that is struggling to keep people on the books and their doors open, but it’s ridiculous that policymakers and financial institutions have placed those larger businesses and corporations in the front seat while small businesses are starving in the back row,” Kabateck said.
Thanks @imstilla.grandma for summarizing the various loan programs promoted by the government.
We know Congress has been behind closed doors for more than a week replenishing the PPP loan program after the first-come, first-served pot bled dry.
Are they also closing the loopholes and exemptions (they created) that allowed this to happen?
More public companies that bled the pot dry to add to the wall of shame:
Luxury hotel group Ashford, Inc. (i.e., Marriott, Ritz, Braemar Resorts, etc.) with 7,000-plus workforce used loopholes and exemptions in the loan program to spread claims over multiple subsidiaries and received $59M. Ashford has also furloughed 95 percent of its staff.
The PPP was set up by the government to help small businesses pay workers and bills but many large firms have claimed millions through loopholes. The program has a $10million and 500-staff limit.
And the banks that helped them:
The Paycheck Protection Program offering $349billion in emergency loans to small businesses was advertised as first come, first served
- A New York Times report claims banks including JPMorgan Chase, Citibank and US Bank prioritized their richest customers before turning to other loan seekers
- Bank employees and executives told the Times big clients were given 'concierge treatment' as their loan applications were pushed to the front of the line
- Thousands of small businesses struggled to submit applications through overcrowded online portals while bank reps were told to ignore their calls
Luxury hotel group is the biggest beneficiary of coronavirus loan program with $59 MILLION | Daily Mail Online
How big banks including Chase and Citi helped richest clients get millions in pandemic aid | Daily Mail Online
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