Business Financial Support - Part 2 | Covid Response Call - April 30, 2020

05/04/2020 3:45 PM | Morgan Pierce (Administrator)

DCI had our sixth webinar of the series covering various topics on the response to COVID-19 and how people can support each other while maintaining the CDC’s recommendation of social distancing. Thursday’s webinar included a presentation from DCI partner, Amanda Peterson, Head of Compliance & Regulatory Affairs for Colorado Lending Source. The call was facilitated by DCI board member, Terri Takata-Smith of Downtown Boulder and her colleague Julia Simpson.  

Amanda walked us through the updates and new information regarding the CARES Act 2.0 and some alternative funding resources as presented in the below table. 

CARES Act Overview
1.0 - Funding was exhausted in 14 days. 
2.0  - Additional money allocated towards the Paycheck Protection Program (PPP) with a focus on smaller banks lending to small businesses

The Economic Injury Disaster Loan Emergency Advance (EIDL) received additional funding as well. 

Watch out for Scams & Frauds
- SBA does not initiate contact
- Any request of payment up front to get approval of an SBA loan or offers of a high interest bridge loan, suspect fraud


Is there any news on 501c6 organizations and their exclusion from the PPP and EIDL loans?
As of now they are still not included in PPP or EIDL loans, but there are organizations advocating for 501c6s. International Downtown Association is fighting to support 501c6s to get them some help.

Is OEDIT going to start any financial support programs?
They are reported to be working on it now.

Is there a possibility that the June 30th date will be extended?
Entities are advocating for the period to be extended, especially for businesses like restaurants which will have a hard time with the June 30th date. Colorado Lending Source recommends sending a note or putting in a phone call to Colorado Lending Source who can advocate for the extension alongside other businesses behalf.

If an organization does not get PPP in the second round, what should they do for funding?
There are emergency relief funds available for region, county and districts, and there are also direct loans available. Communicate with your SBDC.


Matrix of Financial Support

Paycheck Protection Program (PPP) 

Small businesses, Self-employed, 501c3, 501C19, Tribal Businesses during covered period (Feb 15 - Jun 30, 2020)

2.5 times employer’s average monthly payroll costs 

Interest Rate - 1.00% 

Loan Term - 2 Years

No payments first 6 months

Payroll Costs Defined (Refer to Colorado Lending Source Presentation)

Guidelines for Sole Proprietor or independent contractor (Refer to Colorado Lending Source Presentation)

Loan Forgiveness

Not as much guidance on forgiveness right now since the lenders are focusing on getting the money out

Will need to apply for forgiveness and show documents

Economic Injury Disaster Loan Emergency Advance (EIDL)

Can be used to pay fixed debts, payroll, accounts payable and other costs 

Direct loan from SBA

Not to replace lost sales or profits, refinancing debt, loan payments to other federal agency, tax penalty obligations, repair physical damages, pay dividends to stockholders

Interest rate - 3.75% 

Up to $2 million and maturity up to 30 years

PPP borrower can not receive EIDL for same purpose as PPP

KIVA Loans

Alternative Finance option for small businesses 

Crowdfunded online from global lenders and people you know

$1,000 - $10,000 

0% interest, no fees

12-36 month term

Monthly payments, 6 month grace period

Loans through Paypal 

Any loan purpose, except refinancing existing debt 

Business owner requirements: Paypal account, not in bankruptcy, certain number of people in network each lend $25, honest & responsive 

About Colorado Lending Source
Celebrating 30 years of lending, Colorado Lending Source cares about small business, creating long-term alliances with our lending partners and borrowers, being a resource to empower entrepreneurs, and making Colorado the best state in the nation to start and grow a business. Colorado Lending Source partners with local lenders, government agencies, and other small business resources to make access to capital more attainable. As a mission-based lender and small business-financing expert, they are committed to fostering the economic growth of diverse small businesses within our communities. Since 1990, they’ve funded over 3,800 loans helping to create nearly 29,000 jobs injecting over $4.7 billion into the economy

Amanda Peterson,Head of Compliance & Regulatory Affairs, Colorado Lending Source
Amanda Peterson is Colorado Lending Source’s resident expert when it comes to keeping a pulse on Small Business Administration rules and regulations. As Head Compliance & Regulatory Affairs, she provides the necessary tools, knowledge and strategies to support Colorado Lending Source’s mission to foster the economic growth of diverse small businesses within our communities.

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