Coronavirus Aid, Relief, and Economic Security (CARES) Act
The latest federal stimulus package increases authorized loan commitments from the SBA to $349B. Under this program, approved lenders -- existing SBA lenders are automatically approved -- can provide 100% federally-backed loans of up to $10 million to eligible businesses.
The U.S. Chamber of Commerce estimates $5.6 billion will be available for Arizona’s small businesses.
Eligible loan recipients include businesses and nonprofits that employ no more than 500 employees. For businesses in the accommodation and food services sector, and that have more than one physical location, the 500 employees requirement is per location.
The U.S. Chamber created a comprehensive guide with everything you need to know about how to apply for relief under the CARES Act, including eligibility, requirements and application guidelines. This helpful resource provides direction for those small businesses with less than 500 employees, gig economy workers, 1099 workers, one-person businesses, self-employed workers, independent contractors or a small 501(c)3.
The Small Business Paycheck Protection Program provides small businesses with funds to pay up to eight weeks of payroll costs including benefits. Funds can also be used to pay interest on mortgages, rent, and utilities. All funds provided in the form of loans will be fully forgiven when used for payroll costs, mortgages, rent and utilities. Business may start applying April 3 and independent contractors and self-employed individuals may apply April 10.
For a top-line overview of the program CLICK HERE
If you’re a lender, more information can be found HERE
If you’re a borrower, more information can be found HERE
The application for borrowers can be found HERE
You can apply for the Paycheck Protection Program through any existing SBA lender or through any federally insured depository institutions, federally insured credit union, and Farm Credit System institution that is participating. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program. You should consult with your local lender as to whether it is participating. Please visit the SBA for a list of lenders.
The SBA will prioritize small business concerns, underserved and rural markets (including veteran communities), businesses owned by socially and economically disadvantaged individuals and businesses in operation for less than two years.
CARES extends the SBA's Disaster Loan Program through the end of the calendar year, in addition to adding businesses with less than 500 employees, sole proprietorships and independent contractors as eligible entities. It also waives rules related to personal guarantees on advances and loans of less than $200,000, lowers the one-year-in-business rule and waives the requirement that an applicant must be unable to find credit elsewhere.
Applicants may request an emergency advance of up to $10,000, which does not have to be repaid, even if the loan application is later denied. (It will be counted towards the applicant’s loan forgiveness, if approved.) SBA Disaster Loan Program loans made after January 31, 2020 can be refinanced.
In addition, federal funding is available for unemployment compensation for gig workers impacted by COVID-19, if not otherwise covered by state unemployment insurance. CARES provides recovery rebates of up to $1,200 for US taxpayers (and an additional $500 for each child) in the form of an advance refundable tax credit. The Act allows for refundable credit against payroll tax liability equal to 50% of the first $10,000 in wages per employee (including value of health plan benefits) and postpones the due date for depositing employer payroll taxes.
Other federal relief packages to date include:
Families First Coronavirus Response Act (H.R. 6201)
Provides two weeks of paid sick leave for most workers and up to three months of paid family and medical leave (at two-thirds pay); free COVID-19 testing, including appropriating $1 billion to cover the cost of testing for uninsured people, and millions for the Indian Health Services and Department of Veterans Affairs to provide testing; over $1 billion in new dollars to address food insecurity; and $1 billion in grants to states to pay unemployment insurance claims. To understand the requirements and how they might affect your business, see the FFCRA's Employer Paid Leave Requirements.
Coronavirus Preparedness and Response Supplemental Appropriations Act (H.R. 6074)
Provides $3.1 billion to the Department of Health and Human Services, including $100 million to community health centers for underserved groups; $950 million to the CDC to disperse to state and local health response; and $300 million to purchase vaccines and treatments for COVID-19.
The Paycheck Protection Program (PPP) provides cash-flow assistance through 100 percent federally guaranteed loans to employers who maintain their payroll during this emergency. If employers maintain their payroll, the loans would be forgiven for up to 8 weeks of payroll. Small businesses and other eligible entities will be able to apply if they were harmed by COVID-19 between February 15, 2020 and June 30, 2020, and were in operation on February 15, 2020.
Costs that may be covered under PPP include employee compensation, payment for vacation time or sick leave, payment required for group healthcare benefits, payment of retirement benefit and payment of state or local tax assessed on the compensation of employees. Employer/owner compensation over $100,000, compensation of employees whose principal residence is outside of the US and qualified sick/family leave for which a credit is allowed under the Families First Coronavirus Response Act are not eligible costs to be covered under the PPP.
Recipients of other SBA financial assistance (e.g. Emergency Economic Injury Grant, Economic Injury Disaster Loan and Small Business Debt Relief Program) may apply for a PPP loan so long as the funds are not used for the same purpose. An entity is limited to one PPP loan.
All current SBA 7(a) lenders are eligible lenders for PPP. Use SBA’s Lender Match to find a lender near you.
The U.S. Small Business Administration (SBA) approved an Economic Injury Disaster Loan declaration for Arizona that will help small businesses here in the state impacted by COVID-19. There is no minimum loan requirement, though loans are capped at $2,000,000 per business and business affiliates.
Arizona businesses impacted by COVID-19 may apply for the loan here. For assistance, applicants can contact SBA’s Customer Service Center at 1-800-659-2955 or email firstname.lastname@example.org. For additional help with the application process, contact your local Small Business Development Centers (SBDC) at www.azsbdc.net.
Businesses that have been in operation since January 31, 2020 with 500 or fewer employees, and most nonprofits of any size, are eligible to apply including:
- Sole proprietorships, with or without employees
- Independent contractors
- Cooperatives and employee owned businesses
- Tribal small businesses
The loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of COVID-19’s impact.
- Businesses approved will be offered loan terms up to 30 years with a 3.75 percent fixed interest rate. The interest rate for non-profits is 2.75 percent.
- SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.
- Loans which exceed $25,000 must be secured to the extent possible. SBA will not decline a loan if you don’t have enough collateral but will ask for whatever collateral is available which may include real estate owned by a business’ principals or in the form of a lien on the damaged residential property.
The CARES Act extends the SBA's Disaster Loan Program through the end of the calendar year. It also waives rules related to personal guarantees on advances and loans of less than $200,000, lowers the one-year-in-business rule and waives the requirement that an applicant must be unable to find credit elsewhere.
To see if your business is classified as a small business, see the SBA’s size standards here. Small businesses throughout the entire state that fit these criteria are eligible. SBA Disaster Assistance Loans are directly through the SBA and can be in addition to a current SBA 7a or 504 loan.
If you wish to apply for the Advance on your EIDL, please visit www.SBA.gov/Disaster as soon as possible to fill out a new, streamlined application. In order to qualify for the Advance, you need to submit this new application even if you previously submitted an EIDL application. Applying for the Advance will not impact the status or slow your existing application.
Arizona businesses impacted by COVID-19 may apply for the loan here. There is no cost to apply. Once a borrower submits an application, approval timelines depend on volume. Typical timeline for approval is 2-4 weeks and disbursement can take up to 5 days.
Borrowers are assigned individual loan officers for servicing of the loan. SBA will contact applicants directly as their application is reviewed and processed. SBA may call phone numbers provided, email applicants and send messages directly through the Disaster Loan Application Portal.
The SBA encourages all business owners to apply immediately to help with expediency of distributing funds. Applicants do not need to know in advance how much or even if they will need to borrow funds. The SBA will work directly with the taxpayer to determine the proper needed loan amount for that individual business. Applicants do not have to accept the disaster loan if another loan program works better for your business.
The Arizona Commerce Authority will continue to update this section as more information is available on changes or additions to SBA funding.
Note: When applying for a disaster assistance loan related to being impacted by COVID-19, only apply for an Economic Injury Disaster Loan (EIDL) or your application may be delayed or rejected. Please only apply online and refrain from paper submittals. This will ensure your application is processed in a timely manner.
SBA Lender Match
This SBA tool can be used by small businesses to match with SBA approved lenders through this portal. Review details.
Lenders found through the SBA Lender Match can assist with loans such as:
- SBA 7(a) Loan - provides loans of up to $5M for borrowers who lack credit elsewhere
- SBA 504 Loan - provides loans of up to $5.5M to approved small businesses with long-term, fixed-rate financing used to acquire fixed assets for expansion or modernization
- SBA Microloans - provides loans up to $50,000 to help small businesses start up and expand
SBA Local Assistance Finder
This is a helpful tool for small businesses to find local support. Review details.
Growth Partners Arizona
Offers two loan programs for Arizona small businesses affected by COVID-19 -- Kiva Tucson and the Small Business Success Loans -- both of which offer flexible rates and terms for qualified borrowers. Loan amounts can range from $1,000 to $75,000. For further assistance, contacts 520-382-9218 or email@example.com. Review details.
Real Energy for America Program (REAP)
The USDA has extended the application deadline for the Rural Energy for America Program (REAP) to April 15, 2020. For additional information, you may contact Téremy Henriquez, Energy Program Coordinator at firstname.lastname@example.org or 787-766-5355.
Community Investment Corporation
Launched an emergency microloan fund to support businesses affected by coronavirus. Businesses must be based in southern Arizona. Review here.
Contact: Central/Northern AZ 602-258-9918 or Southern AZ 520-268-9245
Neighborhood Economic Development Corporation (NEDCO)
Contact: Tempe/Mesa 480-258-6927, ABeveridge@TurnANewLeaf.org or LSuarez@TurnANewLeaf.org
PPEP Microbusiness & Housing Development Corporation
Contact: 1-800-293-2974 (microloan)
Notes for existing USDA borrowers:
Business and Industry (B&I) Loan; Real Energy for America Program (REAP) - Beginning immediately, through July 31, 2020, lenders may assist borrowers experiencing temporary cash flow issues by deferring payments for a period no longer than 120 days, with written notice. This guidance applies to all borrowers that had a current repayment status as of March 1, 2020. Contact your lender.
Intermediary Relending Program (IRP); Rural Economic Development Loan (REDL) – The USDA will work with borrowers on loan servicing requests on a case-by-case basis.
Offering $100 million in cash grants and ad credits to help up to 30,000 eligible small businesses as they face business disruptions as a result of the global outbreak of COVID-19. Facebook will begin taking applications in the coming weeks, but businesses can visit the Facebook Business Resource Hub for updates. Review details.
Invest Southwest / LeadMD
Partnered to establish a small business relief fund. Beginning April 20th, Arizona-headquartered companies meeting certain criteria may apply for relief through the Arizona Local Impact Fund. Companies may also donate to the fund.
Rural Business Development Grant
The USDA has extended the application deadline for the Rural Business Development Grant (RBDG) program to no later than April 15, 2020. Applications should continue to be sent to the USDA State Office.
The Arizona Legislature approved a $50M coronavirus relief package that allows Governor Ducey’s administration to fund response programs related to housing assistance, business support and relief for nonprofits and healthcare providers.
Governor Ducey announced the formation of the AZ Coronavirus Relief Fund and as part of the Arizona Together, an initiative to support Arizonans during the COVID-19 outbreak, connecting individuals and businesses to resources, raising money for community organizations and providing information on volunteer opportunities.
A list of all executive actions taken by Governor Ducey can be found here.
Governor Ducey issued Executive Order 2020-12, which prohibits the closure of businesses providing essential services. You can find the executive order, which details what those services are, here.
At this time, there is no certification process to have your business included on the list of essential services.
Federal Tax Extension
The U.S. Treasury Department has announced that the federal tax-filing deadline has been moved to July 15, 2020 from April 15, 2020. Individuals and corporations can also delay their tax payments for 90 days due to the coronavirus pandemic. Individuals can defer up to $1 million in payments for 90 days from the April 15 deadline.
Taxpayers have until July 15, 2020, to respond to the IRS to verify that they qualify for the Earned Income Tax Credit or to verify their income. These taxpayers are encouraged to exercise their best efforts to obtain and submit all requested information, and if unable to do so, please reach out to the IRS indicating the reason such information is not available. Until July 15, 2020, the IRS will not deny these credits for a failure to provide requested information.
Visit the Internal Revenue Service for guidance on tax filing and payment deadlines, as well as additional resources at the Coronavirus Tax Relief page.
Arizona Tax Extension
In accordance with Treasury Secretary Steve Mnuchin’s move to delay the deadline for 2019 federal tax returns to July 15, 2020, Governor Ducey has instructed ADOR to move the deadline for filing and paying state income taxes to July 15, 2020. Taxpayers submitting payments after the previous April 15th deadline will not be penalized.
IRS People First Initiative
On March 25th, the IRS announced their “People First Initiative,” which includes guidance for Installment Agreements and Offers in Compromise, among other taxpayer programs. Under this initiative, new automatic, systemic liens and levies will be suspended during this period; however, field revenue officers will continue to pursue high-income non-filers and perform other similar activities where warranted. The IRS may start new examinations where deemed necessary to protect the government’s interest in preserving the applicable statute of limitations. The IRS will continue to work refund claims where possible, without in-person contact.
In addition to compliance activities and examinations, the IRS encourages taxpayers to respond to any other IRS correspondence requesting additional information during this time if possible. Details can be found on the IRS website, here. For more information or for assistance, contact the IRS here.
Employee Retention Credit
The Employee Retention Credit is a fully refundable tax credit for employers who have closed or partially closed due to COVID-19 and have not received a Paycheck Protection Program loan. This tax credit is 50 percent of qualified wages that eligible employers pay their employees, up to $10,000 per employee. The credit applies to qualified wages paid after March 12, 2020, and before January 1, 2021. The refundable credits are applied toward the employer portion of payroll taxes.
Payroll Tax Credits
On March 20th, the U.S. Treasury Department, IRS and the U.S. Department of Labor announced new refundable payroll tax credits, designed to immediately and fully reimburse employers, dollar-for-dollar, for the cost of providing Coronavirus-related leave to their employees. This relief to employees and small to midsize businesses is provided under the Families First Coronavirus Response Act. This includes up to 80 hours of paid sick leave for COVID-19 related instances and expanded paid childcare leave when employees' children's schools are closed or childcare providers are unavailable. It also offers employers complete coverage -- employers receive 100% reimbursement for paid leave pursuant to the Act. An immediate dollar-for-dollar tax offset against payroll taxes will be provided.
To take immediate advantage of the paid leave credits, businesses can retain and access funds that they would otherwise pay to the IRS in payroll taxes. If those amounts are not sufficient to cover the cost of paid leave, employers can seek an expedited advance from the IRS.
OSHA - guidelines for employers confronting the coronavirus
NFIB - tips for preparing small businesses
CDC - guidance for employers and businesses to plan and respond to COVID-19
U.S. Chamber of Commerce - guidelines for small businesses
DOL - guidelines and FAQs for businesses in relation to FLMLA, FLSA and FFCRA
Nearly 90 percent of the Department of Real Estate’s services, such as renewing or applying for licenses and filing complaints can be completed online through the Online License System or the Online ADRE Message Center. At this time, ADRE is not waiving continuing education hours for license renewals, nor extending expiration dates. Licensees with upcoming expiration dates should search the ADRE public database for available online continuing education courses.
Pre-license schools may use video conferencing technology (e.g. Zoom) for students currently enrolled in pre-licensing live courses, but must submit the currently approved pre-licensing course on the ED-102 through the Message Center before beginning the remote course. Note that schools must submit a new 14 day notice through the ADRE Online System to ensure courses are listed correctly on the ADRE Public Database. This includes course cancellations. Original license exams are delayed with the temporary closure of Pearson Vue testing centers until April 16th. For more information, visit the ADRE website.
Additionally, on March 26, 2020, Governor Ducey issued an Executive Order to help licensed professionals in Arizona stay licensed by deferring certain requirements for six months. State agencies and boards will defer requirements to renew licenses that have an expiration date between March 1, 2020 and September 1, 2020 by six months from the expiration date, unless those requirements can be completed online. Additionally, they will defer requirements to complete continuing education by six months, unless those requirements can be completed online.
The order applied only to the following agencies or boards listed below:
- Acupuncture Board of Examiners
- Department of Agriculture
- Arizona Board of Osteopathic Examiners in Medicine and Surgery
- Arizona Board of Technical Registration
- Arizona Medical Board
- Arizona Regulatory Board of Physician Assistants
- Arizona Board of Nursing
- Arizona State Board of Pharmacy
- Arizona State Veterinary Medical Examining Board
- Board of Athletic Training
- Board of Behavioral Health Examiners
- Board of Barbers
- Board of Certified Public Accountants
- Board of Cosmetology
- Board of Examiners of Nursing Care Institution Administrators and Facility Managers
- Board of Homeopathic and Integrated Medical Examiners
- Board of Massage Therapy
- Board of Occupational Therapy Examiners
- Board of Physical Therapy
- Board of Respiratory Care Examiners
- Department of Environmental Quality
- Department of Insurance
- Department of Financial Institutions
- Department of Real Estate
- Department of Liquor Licenses and Control
- Naturopathic Physicians Medical Board
- Department of Public Safety
- Register of Contractors
- State Board of Chiropractic Examiners
- State Board of Dental Examiners
- State Board of Dispensing Opticians
- State Board of Funeral Directors and Embalmers
- State Board of Optometry
- State Board of Podiatry Examiners
- State Board of Psychologist Examiner
- Department of Transportation
Federal financial institution regulators and state regulators are encouraging financial institutions to meet the financial needs of customers and members affected by the coronavirus.
On Monday, March 16th, the federal bank regulatory agencies began encouraging banks to use the Federal Reserve's discount window to support households and businesses through short-term loans to banks, which in turn supports the flow of credit to households and businesses.
Nearly all financial institutions serving US consumers and small businesses have enacted policies to respond to the coronavirus outbreak. In addition to the following, Forbes maintains a comprehensive list of the policies and has committed to updating the page as developments arise..
Bank of America - Customers who are unable to pay their bills, or believe they face hardship preventing them from paying their bills, should contact client services.
Capital One - Customers are encouraged to use digital banking tools. If customers are facing financial difficulty due to COVID-19, they should contact the bank’s customer support as customers may be eligible for assistance such as minimum payment assistance, deferred loan assistance or fee suppression.
Chase - Customers are encouraged to use digital banking tools. If customers are facing financial difficulty due to COVID-19, they should contact the bank’s customer support (phone number listed on the back of credit/debit cards and on monthly statements). In the past, Chase has supported its customers, including small businesses, through times of crisis by issuing fee waivers, changing due dates, and extending credit lines. As of right now, Chase will work with customers on an individual basis to determine financial assistance.
Citibank - For 30 days following March 9th, customers can contact Citibank for assistance that includes: fee waivers, waived penalties and credit line increases. Bankers are also available for extended hours to support small business customers.
Export-Import Bank of the United States - EXIM is offering various relief measures to their customers for an initial period of 30 days, starting March 12. The measure includes waivers, deadline extensions and streamlined processing, in addition to individualized support as the need arises.
Fifth Third Bank - Customers will be notified if any branches require closing and are encouraged to utilize digital banking tools in the interim.
PNC - Customers experiencing financial hardship as a result of the coronavirus are encouraged to call 1-888-762-2265 for additional information and assistance. PNC will continue monitoring the situation to determine if additional assistance is necessary.
US Bank - Customers are encouraged to use digital banking tools. If customers are facing financial difficulty due to COVID-19, they should contact the bank’s customer support line at 1-888-287-7817.
WaFd Bank - All WaFd Arizona branches are offering small businesses affected by the coronavirus lines of credit of up to $200,000 interest-free for 90 days. The bank will also expedite the processing of new credit applications for companies in operation for at least two-years that demonstrate at least a ten percent revenue reduction due to the coronavirus.
Wells Fargo - If customers are facing financial difficulty due to COVID-19, they should contact the bank’s customer support line at 1-800-219-9739.
As you work to ensure your business is prepared for the implications of COVID-19, the following tools may be helpful:
Business continuity planning (Ready.gov)
Emergency planning exercises (FEMA)
Best practices for disaster preparedness training (U.S. Chamber)
Transitioning to Remote Work
Amazon Web Services - suite of remote work tools
BlueInk - free digital document workflows and eSignature solutions; Mesa-based
Slack – instant messaging and chat platform
Trello – project management tool (remote work guidebook here)
Webex – video conferencing platform
Zoom – video conferencing platform
Meet by Google - video conferencing app; free for all G Suite users until 7/1/2020
Google - remote working tips and resources
Google Distance Learning Tools - collection of training materials
YouTube Learning Hub - collection of educational videos for students
PointerTop - free, no-obligation trial for cross-interactive platform for websites; Tempe-based
Digital Media, Marketing and Communications
Local First Arizona - recorded webinars on a variety of relevant topics for business owners, including an overview on available business resources. You can find more available resources, including industry-specific resources (compiled by Local First Arizona), here.
SBA Local Assistance Finder - a tool for small businesses to find local support
SCORE – hosting webinars and online workshops for local small businesses impacted by the coronavirus
If you are a manufacturer who can help make essential products, or if you can provide relevant services, email the Arizona Commerce Authority at COVIDResponse@AZCommerce.com with a description of your capabilities and how your company can help.
The following are some additional steps you and your business can take to provide support during this time:
- Donate to the AZ Coronavirus Relief Fund here.
- Fill out the US Chamber of Commerce Foundation’s Corporate Aid Tracker.
- Follow the CDC’s interim guidance for businesses and employers.
- Spread accurate information (from the CDC or WHO), and remain calm.
- Practice social distancing, when possible and as advised by the CDC.