Loan Relief for Nonprofit Organizations Through the Main Street Lending Program Expansion

UPDATED 11/9/2020

The Federal Reserve’s Main Street Lending Program (MSLP) has expanded to include two new loans specifically for nonprofit organizations: The Nonprofit Organization New Loan Facility (“NONLF”) and the Nonprofit Organization Expanded Loan Facility (“NOELF”). Nonprofit organizations will now be able to receive support from relief efforts similar to those available to for-profit entities. Many of the basic eligibility, certification, and fees track those already in place for for-profit counterparts.

How the Program Will Operate:

• Nonprofit organizations can access the Loan Participation Agreement form, borrower and lender certifications and covenants, and other required form agreements on the Federal Reserve Bank of Boston’s Main Street Lending Program Forms and Agreements website.
• Lenders are encouraged to begin making loans immediately upon successful registration.
• The NONLF and NOELF Special Purpose Vehicle (SPV) will purchase 95% of each eligible loan submitted if the required documentation is complete and transactions meet the relevant program facility’s requirements.

Program Definitions NONLF and NOELF Loans:

• Eligible Lenders – The same eligible lenders provided for for-profit MSLP facilities.
• Eligible Borrowers – Eligible Borrowers are nonprofit organizations:
  • Created or organized in the U.S. or under the laws of the U.S. with significant operations in the U.S. and a majority of its employees are based in the U.S.;
  • In continuous operation since January 1, 2015;
  • That are not an ineligible business[i];
  • With fewer than 15,000 employees or $5 billion or less in 2019 annual revenues;
  • With a minimum of 10 employees;
  • With an endowment under $3 billion;
  • With total non-donation revenues of at least 60% of expenses from 2017-2019[ii];
  • With a ratio of adjusted 2019 earnings of at least 2% before interest, depreciation, and amortization (EBIDA) to unrestricted 2019 operating revenue[iii];
  • With a ratio of at least 60 days of liquid assets[iv] at the time of loan origination to average daily expenses over the previous year;
  • With, at the time of origination, a ratio greater than 55% of unrestricted cash and investments to existing outstanding and undrawn available debt, plus the amount of any under the Facility, plus the amount of any CMS Accelerated and Advance Payments;
  • That are not a participant in another MSLP facility or the Primary Market Corporate Credit Facility; and
  • Have not received specific support under the Coronavirus Economic Stabilization Act of 2020 (Subtitle A of Title IV of the CARES Act).

Continue reading »

Missouri Offers Additional COVID-19 Relief Grants for Small Business and Family-Owned Farms

The Missouri Department of Economic Development (DED) has provided guidance on how to apply for the Small Business Grant Program as added by the CARES Act and House Bill 2007. The grants seek to provide support to small businesses and family-owned farms by reimbursing the costs of business interruptions caused by required COVID-19 closures.

DED kicked off the grant program by focusing on hardest hit industries: retail trade, accommodation, food service, health care, and family-owned farms. Applications for these industries are being accepted until August 31, 2020. Businesses in other industries may apply on or after September 1, 2020 if funds are still available.

While all a business or farm’s expenses may not be covered, or total reimbursement may not be possible, depending on funding available, the grant program provides another excellent option for COVID-19-related relief.

Program Basics:

The Missouri grant program is statewide with the total funds available set at $30 million, Of this, $7.5 million is specifically available for family-owned farms and family farm corporations.[i] Each applicant may only file one grant application. Hopeful applicants must incur, or have incurred, COVID-related costs between March 1, 2020 – November 15, 2020. Continue reading »

Missouri Employers and Medical Marijuana: What You Need to Know – On-Demand Webinar

co-presented by Katherine M. Flett and Ruth Binger

Ruth Binger and Katherine Flett presented a webinar on what Missouri employers need to know about medical marijuana in the workplace.

“Missouri Employers and Medical Marijuana – What You Need to Know,” a Facebook Live webinar, was part of the Greater St. Charles County Chamber of Commerce‘s Chamber University.

Topics included: Continue reading »

Keeping Your Business in Business During COVID-19: On-Demand Webinar

co-presented by Katherine M. Flett and Ruth Binger

Ruth Binger and Katherine Flett presented a webinar on keeping your business in business, which included employment and business strategies during the pandemic.

“Maintaining a Legally Compliant Work Environment and Navigating the ‘New’ Workplace in the Face of COVID-19,” a Facebook Live webinar, was part of the Greater St. Charles County Chamber of Commerce‘s Chamber University.

Topics included: Continue reading »

Getting Back to Work: OSHA Guidance for Non-Essential Businesses

OSHA has released new guidelines for reopening to help non-essential businesses ensure the safety and health of their employees and customers from the spread of COVID-19.

This new guidance supplements Guidance on Preparing Workplaces for COVID-19 from the U.S. Department of Labor and U.S. Department of Health and Human Services and Guidelines for Opening up America Again from the White House.

Under the new OSHA guidelines, businesses should establish reopening policies and procedures in the following areas: Continue reading »

What Business Owners Need to Know About the Main Street Lending Program Expansion

UPDATED 11/9/2020

The Main Street Lending Program (MSLP) from the Federal Reserve has been expanded. With the expansion, more small and medium-sized businesses can receive support. (Click here for details on the original MSLP program requirements.)

Let’s take a look at what is included in the expansion of the MLSP from modified definitions and program requirements to the new third facility called the Main Street Priority Loan Facility. (The Federal Reserve is currently working to establish a program for nonprofit organizations, but such a program is not yet available.)

Under the newly expanded MSLP, the minimum loan amount is lowered, the maximum loan amount is increased, the principal repayment schedule and loan term are extended, and the Federal Reserve’s participation increased to 95% for all loans. The expanded MSLP is now open for lender registration and the Federal Reserve will be actively buying loans soon.

How the Expansion Program Will Operate:

President Trump Signs Paycheck Protection Program Flexibility Act

The Paycheck Protection Program Flexibility Act (Flexibility Act) makes key changes to the Paycheck Protection Program (PPP) that provide borrowers with more flexibility to obtain loan forgiveness, including extending the time period to spend PPP loan proceeds, reducing the payroll expenditure requirement for PPP loans, and extending the time period to restore employment and wage levels. The following is a summary of the modifications the Flexibility Act makes to the PPP.

1. Extension of Time to Spend Loan Proceeds. The Flexibility Act extends the covered period that a borrower must spend its loan funds from eight weeks after the loan origination date to 24 weeks or until December 31, 2020, whichever is earlier. The Flexibility Act allows borrowers that already received a PPP loan prior to enactment of the Flexibility Act to elect an eight week covered period, which may be beneficial for borrowers who have already spent most of their PPP loan proceeds and are near the end of their original eight week covered period.

2. Payroll Expenditure Requirement. The Flexibility Act reduces the payroll expenditure requirement from 75% to 60%. The remaining 40% of loan funds may still only be used for payments of interest on any covered mortgage obligation, rent and utilities.

In an Interim Final Rule issued on April 3, the SBA established the requirement that at least 75% of the PPP loan proceeds be used for payroll costs. If less than 75% of the of loan funds are spent on payroll costs, the SBA Loan Forgiveness Application requires a borrower to reduce the amount eligible for loan forgiveness. In changing the payroll expenditure requirement to 60%, the Flexibility Act added the following language to the CARES Act: “To receive loan forgiveness”, a borrower “shall use at least 60% of the covered loan amount for payroll costs.” Based on this language it is not clear whether a borrower will still be able to obtain partial loan forgiveness if the 60% threshold is not obtained. Continue reading »

Employers Must Report Work-related COVID-19 Cases to OSHA

Under new guidelines from OSHA, employers must record all work-related COVID-19 cases that meet the following three conditions:

1. The case is confirmed as COVID-19 as defined by the CDC.
2. The case is determined to be work-related.
3. The case results in any of the following:
   1. Death
   2. Significant injury or illness diagnosed by a medical professional
   3. Days away from work
   4. Restricted work or transfer to another job
   5. Medical treatment beyond first aid
   6. Loss of consciousness.

In addition, per the new guidelines: Continue reading »

PPP Loan Forgiveness Application Now Available

Updated 7/6/2020

The Small Business Administration (SBA) and the Department of Treasury have released the Paycheck Protection Program (PPP) Loan Forgiveness Application.

The application deadline for the Paycheck Protection Program has been extended to August 8, 2020. Updated loan forgiveness instructions and forms are available here:

PPP Loan Forgiveness Application Instructions for Borrowers

PPP Loan Forgiveness Application Form – Revised June 16, 2020

Self-Employed: Continue reading »

Safe Harbor Deadline for Repayment of PPP Loans Extended from May 14 to May 18

On May 13, 2020, the Small Business Administration (SBA), in consultation with the Department of the Treasury, extended the safe harbor deadline to repay Paycheck Protection Program (PPP) loans to May 18, 2020. Previously in its PPP Loans Frequently Asked Questions (FAQs), the SBA reminded borrowers to carefully review the required certification on the PPP loan application that “[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.”

In further guidance, the SBA provided that any borrower of a PPP loan that repays the loan in full by the specified safe harbor deadline will be deemed by the SBA to have made the required certification concerning the necessity of the loan request in good faith.  According to the newly issued FAQ #47, Continue reading »