UPDATE: Congressional COVID-19 Stimulus: Small Business Loan Expansions
On March 6th, the Coronavirus Preparedness and Response Supplemental Appropriations Act (“Phase I Bill”) was signed into law and addressed the Small Business Administration (the “SBA”) Economic Injury Disaster Loan Program (the “EIDLP”). On March 25th, by a vote of 96-0, the Senate passed the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), a sweeping $2.2 trillion stimulus package, which includes a $350 billion SBA loan guarantee program established under the “Paycheck Protection Program” to help small business pay for payroll and other necessary overhead expenses such as rent and mortgage interest and which will be available during the period beginning February 15, 2020 through June 30, 2020 (the “Covered Period”). The House approved the CARES Act on Friday, March 27th and the legislation was signed into law on the same day. On March 31, 2020, the SBA released the Paycheck Protection Program Information Sheet (the “Information Sheet”) to offer additional guidance to potential borrowers under the Paycheck Protection Program. This updated memorandum supersedes the Firm’s March 30th memorandum on this topic and covers the latest available information on the 7(a) Loan Program and EIDLP loans which are impacted by the recent legislation.