New Funds for Paycheck Protection Program, Economic Injury Disaster Loan and NJ Economic Development Authority

Jennifer B. Barr, Esq.

Good news for Small Business! Federal and State loan and grant programs have recently received additional funds to help small business affected by government-mandated closures. Here are some additional funds available to small businesses:

  • Paycheck Protection Program – $310 Billion added (if passed and signed)

On April 21, 2020, the Senate passed a $480 Billion relief package. Additional funds for the Small Business Administration for the PPP are included in this package. The House is expected to approve the package on Thursday, April 23, and the President has vowed to sign the legislation. Assuming the proposed legislation is passed by the House and signed by the President, there will be an additional $310 Billion to fund the PPP. 

The PPP is part of the federal CARES Act enacted on March 27, 2020 that allows businesses with up to 500 employees to borrow 2.5 months of payroll costs. The loan does not need to be repaid if the loan is used to pay for payroll, rent/mortgage interest, and utilities.

Applications for the PPP opened for small businesses on April 3, 2020, and for independent contractors and self-employed on April 10, 2020. The initial funding for PPP was $350 Billion. The funds were depleted in less than two weeks.

Today Congress replenished the PPP so more small business can benefit from this much needed program.

To apply for a PPP forgivable loan, contact your lender.

  • Economic Injury Disaster Relief Loans – $10 Billion added (if passed and signed)

The same legislation passed by the Senate on April 21 apportions an additional $10 Billion for EIDLs administered through the Small Business Association, which doubles the initial appropriations.

The CARES Act originally apportioned funds for the Small Business Administration’s Disaster Relief Loans, which included a new Emergency Grant (or “Loan Advance”) of up to $10,000 that does not need to be repaid (if the entity also applies for the PPP the forgiven amount is reduced by the amount of the EIDL Loan Advance ). 

Applications for EIDLs began as soon as the President declared a national disaster on March 13, 2020. Initial funding through the CARES Act for the EIDLs was $10 Billion. The EIDL funds, like those for the PPP, were depleted within two weeks. 

The additional funding, again assuming the proposed legislation is passed by the House and signed by the President, will continue the EIDL program to provide low-interest loans and up to $10,000 emergency grants to small business across the country.

To apply for the EIDL and Loan Advance (Emergency Grant) apply online at once the application portal reopens.

  • New Jersey Emergency Assistance Grant Program – $2 Million added for Atlantic County

On April 7, 2020, the Casino Reinvestment Development Authority announced it would provide additional funding for the New Jersey Economic Development Emergency Assistance Grant Program that began accepting applications on April 3, 2020 for small businesses that are located in New Jersey. The NJ-EDA Grant Program provides up to $5,000 in grants for small business that employ between 1 and 10 Full-Time or Full-Time Equivalent employees. 

The NJ-EDA Grant applications went live on April 3, 2020, but the funds were depleted within about one hour. 

CRDA’s additional funding for Atlantic County small businesses is welcomed relief for local small businesses that were unable to receive grants before the funds were depleted. 

Applications for the NJ-EDA Grant are no longer being accepted. The additional CRDA funding will be applied to previously-submitted applications. 

This message is not intended to substitute for our legal advice to our clients based on their specific needs or requests. In addition, our guidance is subject to and can be superseded by new laws, rules, regulations, or orders. Moreover, some directives from the Federal and State authorities can appear, and can be, contradictory or in conflict so please contact us for assistance.

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