By Cheryl Dowden, April 26, 2020
Previously on April 15, 2020, at the Annual Board Meeting, CEO Lesley Nalley mentioned that HSVPOA staff applied for the Paycheck Protection Program Loan/Grant. This program, administered by the Small Business Administration, was put in place to assist small businesses because of the economic impact caused by COVID-19 mandatory shutdowns.
According to their website, “The Paycheck Protection Program [PPP] is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll.”
“SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.”
Podawiltz Asks for an Update on PPP Status
At the April 20, 2020, Special Board Meeting, Chairperson Podawiltz asked CEO Lesley Nalley to give us an update on the Paycheck Protection Grant. Podawiltz stated, “I’m going to ask our CEO, Lesley Nalley, to explain to us what has transpired today in our applications for assistance from the Federal Government in regards to the pandemic- financial assistance.”
Nalley said, “So, as you all know, some weeks back, CFO Mathis applied for money. I mentioned that in my Annual Meeting comments that we had made application. We’d applied for 3 million dollars of money under the Payroll Protection Program Grant.”
The CEO continued, “We received word today [April 20, 2020] that we needed to sign the documents that we had been authorized for that. We don’t know at this time whether or not it is a forgivable loan. The loan that we do have is at a 1% rate. Obviously, if it is forgivable, we won’t pay some of that back. We don’t have those full details, yet. But we did receive the full amount of what we requested. So, that’s great news.”
“And subsequently the Board, by email, they saw the loan documents and took an email vote and approved us to go ahead and make that, finalize that application- sign those loan documents,” explained Nalley.
Chairperson Podawiltz responded, “That is wonderful news because if you’ve been following this in the media, there wasn’t enough money to go around by any means and as a nonprofit, I believe we were very fortunate to get in on this.”
More Information about the PPP Loan
Application for this loan can be done through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating.” Other lenders may also be approved to participate in this program. To determine participation, you should consult with your local lender.
“Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease.”
“This loan has a maturity of 2 years and an interest rate of 1%.”
“The loan will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent, and utilities (due to likely high subscription, at least 75% of the forgiven amount must have been used for payroll). Loan payments will also be deferred for six months. No collateral or personal guarantees are required. Neither the government nor lenders will charge small businesses any fees.”
By Cheryl Dowden, April 26, 2020
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