Over the past few weeks, the CARES Act has continued to introduce and detail new programs and funding that offers a variety of programs and benefits for various types of industries and businesses. Learn more about 5 of those programs in this blog post.
Over the past few weeks, the CARES Act has continued to introduce and detail new programs and funding that offers a variety of programs and benefits for various types of industries and businesses. The list below is not meant to be comprehensive or apply to everyone, we recommend you discuss your options in more detail with your local lender, Department of Ag or USDA office for more details and how they might apply to your business.
USDA has allocated funds to purchase $3 billion in fresh produce, dairy, and meat. It will begin with procurement of an estimated $100 million per month for the next six months in each of the three categories. This program will focus on purchasing domestic fresh products and delivering it to food banks and other non-profit feeding institutions where it will be made into pre-approved boxes of fresh produce, dairy, and meat products. Additional information about this program through USDA can be found on the USDA’s website.
In addition, more details continue to come out around the $16 billion payment program that will include growers and producers with demonstrated losses caused by the COVID-19 pandemic, particularly as it relates to prices and market supply chain disruption due to lost demand and short-term oversupply. The payment limits which are capped at $250,000 per entity, will not suffice for many agriculture sectors but it is a start. Many industry groups are pushing for changes before the final rules are completed.
As a result of the CARES Act, the Small Business Administration established the Paycheck Protection Program. The initial fund for PPP was quickly depleted, but the Senate passed the Paycheck Protection Program and Health Care Enhancement Act(CV-3.5), which the House is expected to pass shortly. It replenishes the PPP with $310 billion in additional Paycheck Protection Program funding, $60 billion of which will go towards smaller lending institutions. More information on this program and various resources for applicants can be found on the SBA website. If you have not already started your application – contact your bank and do so immediately.
In addition to the PPP, the SBA is also offering Enhanced Economic Injury Disaster Loans (EIDL). Similar to PPP, initial funds were depleted, but CV-3.5 provides $50 billion in additional funding for the Economic Injury Disaster Loan (EIDL) program, and $10 billion in additional funding for SBA’s EIDL Grant program.
U.S. Treasury Secretary Steven Mnuchin announced the establishment of the Main Street Business Lending Program on April 9, 2020. The program is designed to offer assistance to small and mid-sized businesses (up to 10,000 employees or $2.5 billion in 2019 annual revenues) that were in good financial standing before the COVID-19 crisis by offering 4-year loans. For an overview of the program, please visit the Federal Reserve website.
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