Staight Talk with Steve Erdman

As I write this article this week I am very concerned with the continued struggle that the COVID-19 virus has presented us with. This crisis has affected every person not only in my legislative district, but throughout the State of Nebraska, throughout the United States, and even throughout the world.

Folks have been reaching out to me by phone, email and text messaging about the current situation they are facing. Small business owners are saying if they are forced to close up shop, they may never open again. Agricultural people have contacted me about the sharp decline in commodity prices. So, this week I want to share with you information on how small business owners, farmers, and ranchers may receive some help and answer some of your financial questions. As I have visited with many of you, I have heard the anxiety in your voices and your concerns about our future. Remember, the folks in America and in Nebraska are very resilient! We have dealt with difficult situations in the past and we will continue to fight on into the future. It is my sincere hope that we will soon be able to return to some form of normal life and business. I hope the following information is helpful.

President Trump and the U.S. Congress are providing relief to small business owners, farmers, and ranchers in three different ways through the CARES Act. These three relief programs include the Paycheck Protection Program, SBA disaster loans, and non-disaster SBA loan forgiveness. More details for each of these programs can be found on the White House’s website or by going to http://www.coronavirus.gov/smallbusiness/. So, what is contained in these three programs?

The purpose of the Paycheck Protection Program is to help employers pay their employees and cover other costs during the coronavirus healthcare crisis. Those eligible to participate in the program include small businesses, non-profits, Veterans Groups, and Tribal Groups with less than 500 employees. Farmers and ranchers who meet the SBA threshold are also eligible. Because the SBA’s definition of a small business is different than the USDA’s definition, more farms and ranches should qualify. Generally speaking, the SBA definition is 500 employees or less or one million dollars in size or less. Loans up to $10 million can be used to cover payroll, paid sick leave, insurance premiums, rent, utilities and mortgage. Those business owners who retain their full staff and payroll up to eight weeks will be eligible for 100 percent loan forgiveness. Business owners interested in taking advantage of the program should contact and apply through their local bank.

Small Business Administration (SBA) loans are Economic Injury Disaster Loans which are designed to help small business owners continue operating during the coronavirus pandemic. Those eligible are small business owners, non-profits, Tribal businesses, and Cooperatives. Farmers and ranchers may also qualify. Some businesses may be available for an up-front advance payment, which does not have to be repaid; otherwise, the loans are offered at a long term, low interest rate of only one percent. Those interested in obtaining SBA loans should contact their local bank or call Elizabeth Yearwood in Lincoln at (402) 221-7200 or visit the website of the Nebraska District Office at http://www.sba.gov/offices/district/ne/omaha.

The CARES Act also includes loan forgiveness on already existing SBA loans. Business owners won’t have to make payments on their already existing SBA loans for the next six months. Those eligible are small business owners who are already participating in the 7(a), Community Advantage, and microloan programs. No action is needed to participate in this program. Payments that become due during the six month period beginning on March 27 will never have to be repaid, and this benefit applies to new borrowers as well.

Remember, we are not in this crisis alone. So, please stay in contact with your friends and neighbors, and especially remember to check in on the elderly. Continue to practice handwashing, surface cleaning and disinfecting, and social distancing, and together we can defeat this invisible enemy.