ECONOMIC INJURY DISASTER LOANS AVAILABLE FOR HAWAII SMALL BUSINESSES SUFFERING LOSSES DUE TO COVID-19
News Release from Office of the Governor, March 20, 2020
Hawai‘i small businesses suffering financial losses from the impact of COVID-19 can now file for low-interest working capital loans of up to $2 million from the Small Business Administration (SBA).
The SBA today approved a certification request submitted by Gov. David Ige, clearing the way for Hawai‘i small businesses to participate in the SBA’s Economic Injury Disaster Loan (EIDL) Assistance Program. The loans can be used to pay fixed debts, payroll and other bills that can’t be paid because of a disaster’s impact.
“Small businesses are a vital economic driver in our community, and we must do everything we can to support them as they struggle through this crisis,” said Gov. Ige. “We appreciate the SBA’s quick action to approve this loan program for small businesses that have been hit so hard by COVID-19 outbreak.”
Loan applicants are required to file the following documents:
- Loan application (SBA Form 5), completed and signed.
- Tax Information Authorization (IRS Form 4506-T), completed and signed by each applicant, each principal owning 20 percent or more of the applicant business, each general partner or managing member; and, for any owner who has more than 50 percent ownership in an affiliate business. Affiliates include, but are not limited to, business parents, subsidiaries, and/or other businesses with common ownership or management;
- Complete copies, including all schedules, of the most recently filed Federal income tax returns for the applicant business; an explanation if not available.
- Personal Financial Statement (SBA Form 413) completed, signed, and dated by the applicant, each principal owning 20 percent or more of the applicant business, and each general partner or managing member.
- Schedule of Liabilities listing all fixed debts (SBA Form 2202 may be used) are required to file three SBA forms and one IRS form.
Loan forms and additional information can be accessed online at the SBA’s Disaster Assistance Loan Portal.
Interest rates for the loans are 3.75 percent for small businesses without credit available elsewhere. The interest rate for non-profits is 2.75 percent. Terms are determined on a case by case basis, based upon borrower’s ability to repay. The SBA tries to make a decision on each application within 21 days. For businesses facing short-term liquidity issues, including making certain debt payments, it is highly recommended that they contact their bank to see what kind of relief programs may be available.
The SBA uses a “table of size standards” to define what qualifies as a small business based on the business’s number of employees and average annual receipts. Using these criteria, a small business could be defined as a business with a maximum of 250 employees up to a maximum of 1,500 employees.
According to an analysis by the Department of Business, Economic Development and Tourism there are 8,302 businesses in Hawai‘i with 99 or fewer employees. Those businesses account for 96,189 jobs with a combined annual payroll of $3.16 billion.
DCCA: UPDATE (3/20): SBA DISASTER LOAN PROGRAM IS OPEN
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CONGRESSMAN ED CASE ALERTING HAWAI’I SMALL BUSINESSES TO KEY DEADLINE FOR PURSUING FEDERAL COVID-19 ASSISTANCE
State needs economic injury by tomorrow to support declaration for eligibility
News Release from Office of Rep Ed Case, March 17, 2020
(Honolulu, HI) – U.S. Congressman Ed Case (HI-01) today asked Hawai’i small businesses for help in advancing their eligibility for federal economic injury assistance as authorized by recent emergency legislation passed by Congress.
“Our nation’s small businesses have been especially hard hit by our COVID-19 crisis, “said Case.
“This is particularly true in our Hawai’i because our small businesses are at much greater part of our economy and because so many depend one way or another on travel and tourism.”
“Please see this notice from the State and the U.S. Small Business Administration (SBA), which states ‘we need Hawai‘i’s small business concerns that have suffered substantial economic injury as a result of the COVID-19 disaster to submit the estimated economic impact on their businesses by completing this worksheet and then emailing it to firstname.lastname@example.org’.”
Case noted that that the deadline to complete the worksheet and submit to the State Department of Business, Economic Development and Tourism email stated above is: WEDNESDAY, MARCH 18TH, 4 PM.
Case emphasized that any supporting submissions by Hawai’i small businesses are not applications for assistance. That will come after the Governor has issued the declaration and the federal government has approved aid to Hawai’i.
“The $8.3 billion emergency supplemental funding measure that Congress voted to pass and the President signed on March 5th includes billions in assistance to our small businesses affected by COVID-19 through the SBA,” said Case.
“For Hawai‘i small businesses to qualify, the Governor needs to make an SBA-required economic injury declaration.”
Case added: “I have been working with the Governor and our local SBA to get that declaration made and accepted by the SBA as soon as possible so our affected small businesses can start applying for and getting desperately-needed assistance. We need Hawai‘i small businesses’ help to complete and back up that declaration.”
HTH: State wants small businesses to complete, turn in COVID-19 economic impact statements by Wednesday