Additional Financial Resources Available to Businesses – New YorkMarch 30, 2020
In addition to the Coronavirus Aid, Relief, and Economic Security Act (“CARES”), there are several additional initiatives available to combat the economic hardship suffered by small businesses in New York, described below. We will continue to monitor these programs as they develop, and as new programs are launched.
NYC Small Business Continuity Fund
To aid small businesses in dealing with a decrease in sales due to COVID-19, New York City has launched the NYC Small Business Continuity Loan Program. Businesses with fewer than 100 employees, which have seen sales decrease by 25% or more, will be eligible to apply for zero interest loans of up to $75,000 to ensure business continuity, with repayment terms of 15-20 years. Eligible businesses are those that are: (a) located within the five boroughs of New York City; (b) demonstrate at least a 25% decrease in revenue due to the pandemic; (c) have fewer than 100 employees; (d) have been in operation for at least two years; (d) demonstrate an ability to repay the loan; and (e) have no outstanding tax liens or judgments.
Businesses can apply as follows: https://www1.nyc.gov/nycbusiness/article/nyc-small-business-continuity-loan-program.
SBA Exporting Assistance Initiative
The SBA Exporting Assistance Initiative provides the following loan programs to eligible small businesses that export directly overseas or those that export indirectly through customers:
- The Export Express Loan Program provides a line of credit or term note of up to $500,000 to small businesses, which can be used for any purpose that increases a company’s ability to export, such as marketing, foreign travel and capital expenditures.
- The Export Working Capital Program provides revolving lines of credit or transaction-based financing of up to $5 million for eligible export-based small businesses to help fulfill export orders or finance international sales.
- The International Trade Loan Program encourages the expansion of small businesses engaged in international trade by providing loans for capital expenditures.
Additional information about such programs is available at https://www.sba.gov/business-guide/grow-your-business/export-products.
To help small businesses deal with the impact of COVID-19, New York City has launched the Employee Retention Grant Program, so businesses can retain employees amid decreased revenue. The Program provides eligible businesses with a grant up to $27,000 that covers payroll costs over a period of two months. Eligible businesses are those that are: (a) located within the five boroughs of New York City; (b) demonstrate at least a 25% decrease in revenue due to the pandemic; (c) have fewer than 5 employees; (d) have been in operation for at least six months; and (e) have no outstanding tax liens or judgments.
Businesses can apply as follows: https://www1.nyc.gov/nycbusiness/article/nyc-employee-retention-grant-program.
NYC COVID-19 Response and Impact Fund
The NYC COVID-19 Response and Impact Fund, funded with $75 million, is organized by private philanthropic foundations to provide grants and no-interest loans to 501(c)(3) nonprofit organizations operating in New York City. Loans range from $100,000 to $3 million, with terms of either 12/24/36 months, and can be used for a number of purposes, including covering delays in government payments for services delivered, postponed fundraising events, and increased expenses. To be eligible, the applicant must: (a) be a 501(c)(3) non-profit organization; (b) be based in New York; (c) receive New York City and/or New York State government funding; (d) have an annual operating budget of up to $20 million (excluding government contracts); and (e) provide programming and services to New York residents.
Non-profits can apply as follows: https://nff.org/nyc-COVID-19-recovery-fund.
Facebook Small Business Grant Program
Facebook has announced that it will provide $100 million in grants and advertisement credits for up to 30,000 eligible small businesses, located in countries in which Facebook operates. Further information regarding Facebook’s grant program is not yet available, but the program can be monitored as follows: https://www.facebook.com/business/boost/grants.
For more information on this or other matters, please contact:
© 2020 Herrick, Feinstein LLP. This alert is provided by Herrick, Feinstein LLP to keep its clients and other interested parties informed of current legal developments that may affect or otherwise be of interest to them. The information is not intended as legal advice or legal opinion and should not be construed as such.