Gov. Tony Evers has requested economic injury disaster loan assistance from the federal government for small businesses impacted by the coronavirus in Wisconsin.
The measure marks a key step in securing financial assistance from the federal government to provide businesses with loans of up to $2 million with low interest rates. These loans are a part of the Coronavirus Preparedness and Response Supplemental Appropriations Act, an economic injury disaster loan declaration recently signed by President Donald Trump.
“Social distancing and self-isolation are critical steps in reducing and preventing the spread of this virus in our communities, but it comes at an economic cost to our local businesses,” Evers said. “The loan assistance from SBA will help alleviate some of the financial burden and stress on our small businesses during this public health crisis.”
The SBA’s Economic Injury Disaster Loans may be used to pay fixed debts, payroll, accounts payable and other bills that cannot be paid because of the coronavirus impact.
The interest rate is 3.75% for small businesses without credit available elsewhere; businesses with credit available elsewhere are not eligible. The interest rate for non-profits is 2.75%.
SBA offers loans with long-term repayments to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.
The loans will also apply to current and future disaster assistance declarations related to coronavirus, according to a U.S. SBA press release.
To speed up the process, the U.S. Small Business Administration reduced requirements for state governments to declare the need for economic injury loan assistance.
As soon as the disaster assistance loans come online, the Wisconsin SBA will widely distribute information about the process and ensure that applications, both online and paper copies, will be readily available. Business owners and nonprofits can also explore SBA’s other lending programs, which could be better-suited for businesses depending on the company’s situation.
The Wisconsin Economic Development Corp. is also launching a $5 million targeted grant programto help businesses with no more than 20 employees that have been impacted by the coronavirus crisis cover rent and meet payroll expenses.
For detailed information on SBA programs for the coronavirus, visit www.sba.gov/coronavirus and for information on all federal programs, visit www.usa.gov/coronavirus or www.gobierno.usa.gov/espanol for Spanish speakers.