Federal and State Disaster Loan and Tax Credit Programs

In response to the increasing dangers of the coronavirus emergency, the federal and state government implemented a series of programs to support small businesses through this difficult time.

Paycheck Protection Program 

The Payment Protection Program is CLOSED to new applicants.

Certain businesses and nonprofits impacted by the coronavirus may receive a loan to up to $10 million through the SBA Paycheck Protection Program.  For businesses that use the loan proceeds to retain workers and pay other specified business costs, all or a portion of the loan can be forgiven.  The Paycheck Protection Program is only available through participating lenders and financial tech companies.    

Economic Injury Disaster Loan Program

The cash advance program is CLOSED to new applicants

Small businesses and nonprofits located in a federally designated disaster area (all of the US currently qualifies) may apply online for a loan up to $2 million through the SBA Economic Injury Disaster Loan (EIDL). 

California Small Business Disaster Relief Loan Guarantee Program

Businesses who do not qualify for the either the Payment Protection Program or the Economic Injury Disaster Loan Program have the option of applying to a state disaster program, the California Small Business Disaster Relief Loan Guarantee Program.  Loan guarantees are offered through a statewide network of seven Small Business Financial Development Corporations who will assist small businesses in applying for a loan of up to $1 million.  

  • Small Business Disaster Relief Loan Guarantee Program Overview

  • List and Contact Information for the Seven Small Business Financial Development Corporations

  • Small Businesses may also apply directly to 13 lenders, who are specifically designated to participate in this program 

SBA Pays Six Months of Payments on Non-Disaster Loans

The SBA will pay 6 months of principal, interest, and any associated fees that borrowers owe for all current 7(a), 504, and Microloans in regular servicing status as well as new 7(a), 504, and Microloans disbursed prior to September 27, 2020.

Deferrals of SBA Disaster Loans

The SBA is providing automatic deferment of SBA disaster loans, which are in good standing on March 1, 2020.  All payments are deferred to December 31, 2020.  Certain restrictions apply.

  • More information on disaster loan deferrals

  • Borrowers do not have to apply for this assistance.  If borrowers make automatic payments, please review the information webpage above.

  • This relief is not available for the Paycheck Protection Program loans or the Economic Injury Disaster Loan program.

Express Bridge Loans

Small business with a pre-existing banking relationship an SBA approved lender may be eligible for an Express Bridge Loan of up to $25,000.  The bridge loan is designed to be repaid when the  business receives approval of an Economic Injury Disaster Loan.

Main Street Lending Program for Medium-Size Businesses

The Main Street Lending Program is designed to assist small and medium-sized businesses that were in sound financial condition before the onset of the COVID-19 pandemic. The Program will operate through three facilities: the Main Street New Loan Facility (MSNLF), the Main Street Priority Loan Facility (MSPLF), and the Main Street Expanded Loan Facility (MSELF).   Implementation of the program will be provided through a special purpose vehicle, created by the Federal Reserve Bank of Boston, to purchase participations in loans originated by eligible lenders. Lenders will retain a percentage of the loans.

Eligibility of borrowers is limited to businesses who meet one of these two criteria:  (1) the business has 15,000 employees or fewer; or (2) the business had 2019 revenues of $5 billion or less. Loans will have a four year maturity, and principal and interest payments on the loans will be deferred for one year.  The Main Street Programs can be used to originate new loans (under MSNLF and MSPLF) or increase the size of existing loans (under MSELF). 

  • The Federal Reserve issued its required report to the US Congress on the activities of the Main Street Lending Program.  As of October 7, 2020, the total outstanding amount of loans was $1 trillion with total value of the collateral pledged being $38.5 billion.        

  • The Federal Reserve Board updated its Frequently Asked Questions (FAQs) for the Main Street Program to reflect the Board and Department of Treasury's expectations regarding lender underwriting. According to the announcement, the revised FAQs emphasize that lender underwriting should look back to the borrower's pre-pandemic condition and forward to their post-pandemic prospects.    

  • The Main Street Lending Program is now accepting submissions of eligible loans to nonprofit organizations, submitted by registered lenders. The Federal Reserve has released a new FAQ for nonprofits. 

The fact sheets below provide additional and specific information about the MSNLF, MSPLF, and MSELF. 

Employee Retention Credit 

The Employee Retention Credit is designed to encourage businesses to keep employees on their payroll. Employers of all sizes that face closure orders or suffer economic hardship due to COVID-19 are incentivize to keep employees on the payroll through a 50% credit on up to $10,000 of wages paid or incurred from March 13, 2020 through December 31, 2020.

Announcement of the Credit Availability    FAQ on the Employee Retention Credit

Paid Family Leave Tax Credit for Small Businesses

The FFCR Act requires employers to provide paid leave through two separate provisions, which include the Emergency Paid Sick Leave Act (EPSLA) and the Emergency Family and Medical Leave Expansion Act (Expanded FMLA).

The EPSLA entitles workers to up to 80 hours of paid sick leave when they are unable to work for certain reasons related to COVID-19, and the Expanded FMLA entitles workers to certain paid family and medical leave.   The FFCR Act authorizes employers subject to these paid leave requirements to apply fully refundable tax credits to cover the cost of the leave required to be paid.  Certain self-employed persons in similar circumstances are entitled to similar credits.  Frequently Ask Questions

FAQ on the Paid Family Leave Tax Credit

Paid Sick Leave - Family First Coronavirus Response Act

The U.S. Department of Labor announced new action regarding how American workers and employers will benefit from the protections and relief offered by the Emergency Paid Sick Leave Act and Emergency Family and Medical Leave Expansion Act, both part of the Families First Coronavirus Response Act (FFCR Act). The department’s Wage and Hour Division (WHD) posted a temporary rule issuing regulations pursuant to this new law, effective today, April 1, 2020.  https://www.dol.gov/sites/dolgov/files/WHD/Pandemic/FFCRA.pdf?utm_medium=email&utm_source=govdelivery

This webpage is being updated on a regular basis. 

 

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