SPOKANE, Wash. — Many small business are struggling to keep their doors open, while complying with Governor Inslee’s orders during the COVID-19 crisis.
But starting Friday, small businesses can apply for the “Paycheck Protection Program." It's the economic rescue plan from Congress with nearly $350 billion in loans available.
The U.S. Small Business Administration is overseeing the loan program. It is designed help small businesses to keep their workers on the payroll and ride out the coronavirus pandemic.
Any small business with less than 500 employees is eligible, including independent contractor, and self-employed people affected by COVID-19.
Businesses can apply for loans through a participating SBA lender.
The SBA will completely forgive the loan if all employees are kept on payroll for eight weeks and the money is used for payroll, rent, mortgage interest or utilities.
Loan payments will also be deferred for six months. No collateral or personal guarantees are required and there will be no fee charges.
The loan has a maturity of two years and an interest rate of one percent.
Adam Hegsted is the owner and Chef of several Spokane and Coeur d'Alene restaurants like Incrediburger, the Yards, and Honey Eatery and Social club.
“Our margins are super slim," Hegsted said. "So we’re not sitting on a bunch of cash to sit for a month or two to pay all of our bills and all of our people.”
He was responsible for about 165 employees. But over the last few weeks, he’s had to make huge layoffs to get by. That’s why he is applying for the small business loan program.
"We've had to lay off 140 employees, which is incredibly sad and very hard for us to do," Hegsted said. "But we're hoping with this relief we can bring a couple of those people back and pay the people we have right now."
Business owners like Hegsted are making several adjustments to stay a float.
"We are on as many delivery platforms as possible. Just in case someone has a preference over one or the other, we've lowered our prices a little bit and created family meal options," Hegsted said.
Through the SBA loan program, businesses could get up to two-and-a-half times their total monthly payroll with a maximum of 10 million.