By the end of last week, almost 60,000 businesses in Ohio have had loans approved through the U.S. Small Business Administration totaling over $14 billion. This places Ohio 7th nationwide in terms of amount of funds approved for Ohio businesses with an average loan of $235,000. These loans have the potential to keep businesses open and workers employed throughout the duration of the Coronavirus pandemic.
Unfortunately, as of last week, the program is no longer accepting applications as the funding for the program has run out. Applications for small businesses opened on Friday, April 3, and for independent contractors/self-employed individuals, it opened a week later. There are ongoing discussions about adding additional funds to the program moving forward to assist even more small businesses. The proposed amount would be around an additional $300 billion to the already dispersed $350 billion from the original program.
The Paycheck Protection Program was included in the Federal CARES Act to help small businesses keep workers employed during the pandemic resulting in the economic downturn. Employers can apply for a loan up to 2.5 times the borrower’s average monthly payroll costs, not to exceed $10 million. The loan is to be used for the following purposes:
- Payroll costs (using the same definition of payroll costs used to determine loan eligibility)
- Interest on the mortgage obligation incurred in the ordinary course of business
- Rent on a leasing agreement
- Payments on utilities (electricity, gas, water, transportation, telephone or internet)
- For borrowers with tipped employees, additional wages paid to those employees
It is our hope that these additional funds become available soon for businesses in Ohio to continue to operate and keep their workers employed throughout the course of the Coronavirus pandemic. We will keep you apprised of any developments on this program and any other programs available to small businesses through our Coronavirus Business Resource page on our Ohio Chamber website.