Small Business Administration website back after crash, loans slow in coming

Apr. 9--Some federal assistance programs designed to provide relief for small businesses are taking longer than anticipated to disburse the money, and high online traffic has caused a government website to crash.

The U.S. Small Business Administration's website is used to apply for disaster loans and other relief programs. The site is now up and running, though some application data, tax forms uploaded to the site, for example, have been lost. Those who have applied and received a confirmation email from the SBA should be in the clear, though others may have to reapply.

"If you went to the SBA portal and you applied only online and you didn't upload anything, then you were OK, as long as you got some kind of indication back from SBA that says we got your application," said Eric Giltner, senior area manager of the SBA.

Giltner spoke of the website crash at a video conference sponsored by the Grand Forks/East Grand Forks Chamber. The conference, held on Wednesday, April 8, is the last in a series of meetings to help business owners understand the variety of relief programs brought about by the coronavirus pandemic.

Funds for one of the disaster loan programs are taking longer than advertised. The Economic Injury Disaster Loan Advance program was supposed to release cash in three days, though due to the volume of applicants, that is not happening. Giltner called for patience, as SBA works through the applications.

"(SBA) has not been following this three-day (time period), so keep that in mind," Giltner said. "The money is there, but, as of Monday morning this week, they had not disseminated any of the funds."

The meeting focused mostly on providing updates to the federal relief programs. The programs cover small businesses as well as some nonprofit groups and veterans organizations.

-- The Economic Injury Disaster Loan Advance program provides up to $10,000 to cover costs. A small business owner can receive $1,000 per full and part-time employees. Businesses must have fewer than 500 employees, though there are exceptions. The Advance loans may be forgiven. This loan is for getting a company quick cash and is meant to lead to a traditional EIDL loan. They can be applied for at https://www.sba.gov/.

-- EIDL loan follow the Advance loan and can be for up to $2 million per business. The term is 30 years and the note carries a 3.75% interest rate. SBA will contact borrowers about pursuing this loan after they have received their Advance loan. A borrower, even if approved for the loan, is not obligated to accept it and can refuse the funds, if they wish.

-- The Paycheck Protection Program (PPP) is a loan that prioritizes workers at small businesses by covering payroll costs for the employer. The amount is determined by the company's payroll costs for eight weeks, plus 25%. The money must be used to pay salaries, though the extra 25% can be used for rent, mortgages on business property and other expenses. This loan will be forgiven provided the money goes to payroll and required costs. This loan must be applied for by downloading the application at sba.gov, then completing it with the company's local lender.

Proceeds from the loans cannot be used for the same purpose. An EIDL loan and PPP loan cannot both be used to pay salaries, for example. If that happens, they may not be forgiven.

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