Over the last few weeks, we have been receiving emails hoping that we are well and healthy, along with an advertisement for a discount on some products. This email is not one of those emails, and we certainly hope that you are well and healthy. We have all experienced times of trouble, but collectively, this is one of the worse we have had together. We have all been here in some microcosm in our lives and individual situations. The current situation has now become a macrocosm, and we are all in this together. If you look back and look over the last few weeks, you will find those who are there for you when trouble comes.
An excellent example of how this applies is the Payroll Protection Program that was released by Congress on April 3, 2020. Many businesses qualified for this, and the applications overwhelmed the banks. From discussions with clients and friends, we have discovered some “inside” advice. For the most part, those that received the funds under this program were not just the big players that we hear about on the news, but businesses that had personal relationships with their banker. The companies that had a relationship with their bankers who were able to process SBA loans were able to help these individuals get approval for this loan. Very few received loans that submitted their applications through the single mass locations that only some banks offered.
This application process is a lesson learned. Your trusted relationships need to involve the professionals necessary to run the business, including lawyers and CPAs, but also financial planners and a strong banking relationship. Take inventory of these relationships over the last few weeks and, if it has not worked, you should be finding someone else. Unfortunately, this is probably true in your personal life, because when trouble comes at 2:00 in the morning, who can you call? Right now, it is time to take inventory of your relationships. Indeed, I do not suggest you unfriend everyone who has not been there for your business or yourself, but take note of who was there. If you need to strengthen those relationships, then you should reinforce them. If you need to add to those relationships, now is the time to do so.
Many of you have heard that Congress is going to vote on the new Payroll Protection Provisions today. If you were left out, you should have your application in now. Your best chance to receive the PPP loan is with a banker that you have a personal relationship. That banker should be one does SBA loans or a local community bank and even some Credit Unions. Some community banks do not require you to have a business account with them to process these loans. If you do not have a banker that you can deal with and do not have a contact in the community or a credit union, you need to go to the sba.gov website and find a lender. This will also be true if you try to apply for an EDIL loan. If you have not investigated either of these two, the EDIL loans do take a lot of work, and the PPP loans are relatively short. You are allowed to roll up your EDIL loan into your PPP loan, and, currently, the Treasury rules are that 75% of the PPP amount must go to payroll. This requirement is subject to change over the next few weeks.
There are unemployment resources for the unemployed and independent contractors that cannot apply for any disaster loans. While unemployment seems slow, States are beginning to process claims. Each State’s Department of Labor (“DOL”) website has the information for the employee that has been furloughed or has completely lost their job. States are slowly rolling out what is referred to as Pandemic Unemployment Assistance (“PUA”) for the self-employed. The Department of Labor websites will have information about the PUA once they are ready to be processed, with some states being faster than others.
We can assist anyone seeking help or guidance on dealing with COVID-19 legal issues as not only is the pandemic situation changing daily, but so is the legal environment. Your time is better spent elsewhere. We can help.
If you need help on these issues, feel free to contact us. If you just need someone to discuss your concerns. We are here for that as well.
Feel free to call if you need help.
Stephen P. Fuller
Parth Munshi, of Counsel