For Malheur County businesses of all sizes, today should be a day of hope.
Friday is the opening day of access to an extraordinary federal rescue program meant to keep small businesses alive through this global pandemic.
Simply put, this is about the easiest access to business cash available.
So, if you own a business in Malheur County, please pay attention. This could save your company, keep workers in place, and flow millions of dollars into our local economy soon.
As part of a $2 trillion package, Congress has created the Paycheck Protection Program. This is unlike any loan program you’ve heard of.
Distilled, your business can get a loan to cover the equivalent of 2.5 months of payroll.
Wait. Don’t balk at the word “loan.” Follow this.
The loan application is two pages.
There is no collateral.
There is no personal guarantee.
There is no ream of tax forms and bank statements.
A company simply has to provide the calculation on its average monthly payroll, multiply that by 2.5 and that’s the amount eligible.
Documentation of that payroll will be required. Since employers have to file quarterly and annual reports to both state and federal agencies to report payroll, the documentation should be at hand.
So, what are the terms of the loan?
This is the most vital feature for business owners to understand: The loan is forgivable. That means any business that follows rules won’t have to pay back the loan. The money is free to keep (again, if the rules are followed).
And even if a business has to carry forward with some of the money in the form of a loan, the latest information is that terms are bearable: 1% interest for two years, no payment for six months. Another good part: No loan fee. The federal government is paying banks and credit unions to process these applications.
What’s the expectation?
That businesses will use the money to keep or return employees to the payroll. But a portion of the money also can be used to cover rent and utilities. It’s up to the business owner to be sure it’s used in a way that can be proven to earn that precious forgiveness.
In other words, as I understand the program from multiple sources, this is potentially like someone handing a local business a pile of money at no cost.
The application form is straightforward. You can access the form to see what is needed. The U.S. Small Business Administration has all sorts of easy-to-follow guidance.
The loans will be handled through banks and credit unions and your banker is likely prepared now to answer questions and help. But expect them to be swamped with applications, so be patient and civil. But do get in line.
Our local economy is already in a rough patch and it’s going to get worse before it gets better. But every business owner from one end of the county to the other should give prompt consideration to grabbing this financial lifeline. You’re not just helping your grocery or hardware store or gas station survive. You’re giving employees more certainty about that paycheck and you’re helping put money into the local economy that’s sorely needed.
We all have much to do to endure and then rebuild this economic crisis. Congress is handing us a powerful tool to start doing so.
Les Zaitz is editor and publisher of the Malheur Enterprise.