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SBA Official: Economic Injury Disaster Loan Program Set to Take Effect

The Small Business Administration, or SBA, is offering various types of help for business owners impacted by the new coronavirus/COVID-19 crisis. Information about that can be found here. Perhaps the most immediate and tangible form of assistance is the organization’s Economic Injury Disaster Loan Program, a low-interest, long-term loan to bail businesses out of the crisis. SBA Nevada Director Joseph Amato spoke with Desert Companion about that program. The conversation, edited for clarity, follows.

 

AN EMERGENCY DECLARATION HAS TO TRIGGER YOUR ECONOMIC INJURY DISASTER LOAN PROGRAM. HAS THAT HAPPENED?

The governor’s team formally submitted, yesterday afternoon, a disaster declaration to the administrator of the national SBA. It must be on her desk now, and as soon as she signs off on it, we’ll be able to start signing off on disaster loans.

 

WHERE DO BUSINESS OWNERS GO TO APPLY?

The disaster loan site. At that site, individual businesses can  get information, apply, submit their application to the SBA, and track the progress of their loan.

 

WHAT ARE THE TERMS OF THESE EMERGENCY LOANS?

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They are at a fixed interest rate of 3.75 percent (2.75 for nonprofits) over 5-30 years, depending on the amount borrowed and estimated time the borrower will be able to start repaying.

 

IS THERE A SPECIFIC AMOUNT SET ASIDE FOR NEVADA?

There’s no allocation per state. There is $50 billion total, $2 million per business in states where an economic disaster has been declared. Not every state is going to declare an economic disaster. Some will, some won’t. Nevada will.

 

ABOUT THAT DISASTER, WHAT ARE YOU HEARING FROM BUSINESS OWNERS IN SOUTHERN NEVADA?

Basically, revenue has fallen off a cliff. Most events and conferences have been cancelled or postponed, sporting events are no longer happening at T-mobile. All those things are affecting small businesses. That revenue stream has been shut off for the current period, and it’s causing economic injury.

 

IN ADDITION TO THE ECONOMIC INJURY DISASTER LOAN PROGRAM, IS THERE ANY EXPECTATION OF GRANTS?

No. The economic injury disaster loan program is the primary program the SBA offers when a disaster is declared. That’s the most beneficial to businesses. Most of them I’m hearing from aren’t looking for grants. They’re looking for economic assistance that’s at a level of repayment they can afford. As soon as business recovers, they’re able to pay them back.

 

DOES SBA HAVE OTHER FINANCIAL ASSISTANCE PROGRAMS, BESIDES THIS ONE?

That’s the primary program, and the only program where the money is disbursed from the federal government. We have other loan programs that are administered through the lending community. So, if someone doesn’t qualify for a disaster loan, it doesn’t mean they can’t qualify for an SBA-guaranteed loan.

 

WHAT ABOUT JUST GENERAL ADVICE?

We have several programs: the SBDCs – small business development centers – which are normally located on college and university campuses, but are also virtual and can still be contacted that way while campuses are shut down; SCORE, the Service Corps of Retired Executives, comprising volunteers who do free business counseling, which is also available virtually right now; and the women-owned business center, also available online. All can be found on SBA.gov/offices/district/nv/las-vegas.

 

OTHER THAN GUIDANCE FROM THE CENTERS FOR DISEASE CONTROL ABOUT SAFEGUARDING THE HEALTH OF EMPLOYEES AND OTHERS WHO INTERACT WITH A BUSINESS, IS THERE ANYTHING ELSE YOU WANT SMALL BUSINESSES OWNERS TO KNOW?

The biggest thing from our agency is, we want to get the information out there that can be vital to the existence of small businesses due to COVID-19 and the impact it’s had here. We’re making a concerted effort to reach out to different communities throughout state, such as the Asian, Latin American, and African American communities, all underserved markets, to make sure they have the information available to make decisions regarding the economic health of their businesses.

 

Whether it’s a loan, or counseling, or just answers to their questions we’ve got the full force of the SBA’s resources behind helping them. Our office is staying operational, even during remote and telework periods, so that we can answer everybody’s questions.

 

HOW CAN PEOPLE REACH YOU?

They can call 702-388-6611. That would be a way you can talk to someone live and we can direct them to the resources they need.

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