Los Angeles Area Chamber of Commerce President & CEO Maria S. Salinas Commends SBA Administrator Jovita Carranza for Moving Forward So Quickly with the $350 Billion Paycheck Protection Program

by L.A. Area Chamber

Los Angeles, CA – April 3, 2020 - The Coronavirus Aid, Relief, and Economic Security (CARES) Act has allocated $350 billion to help small businesses keep workers employed amid the pandemic and economic downturn. Known as the Paycheck Protection Program, the initiative provides 100% federally guaranteed loans to small businesses. The program is expected to provide a significant lifeline to small businesses in Southern California struggling to keep their doors open. This legislation provides small businesses job retention loans to provide eight weeks of payroll and certain overhead costs to keep workers employed.

“The new $350 billion Paycheck Protection Program under the CARES Act, an unprecedented program, will provide much-needed relief to millions of small businesses ensuring they can sustain their businesses and keep their workers employed,” said Los Angeles Area Chamber of Commerce President Maria S. Salinas. “I’d like to commend SBA Administrator Jovita Carranza for moving forward so quickly with the emergency capital to help lenders use their own systems and processes to make these loans available immediately to support our nation’s more than 30 million small businesses and their employees.”

“This program is expected to provide a significant lifeline to Southern California businesses struggling to keep their doors open. What’s important to note is the loans will be forgiven as long as the funds are used to keep employees on the payroll and for certain other expenses,” Salinas continued.

The Paycheck Protection Program provides small businesses with funds to pay up to 8 weeks of payroll costs including benefits. Funds can also be used to pay interest on mortgages, rent, and utilities. The Small Business Administration expects to start accepting applications by April 3^rd. Businesses can go to a participating SBA 7(a) lender, bank, or credit union, apply for a loan, and be approved the same day.

The goal is to position lenders as the single point-of-contact for small businesses – the application, loan processing, and disbursement of funds will all be administered at the local level. Funds are provided in the form of loans that will be fully forgiven when used for payroll costs, interest on mortgages, rent, and utilities (due to likely high subscription, at least 75% of the forgiven amount must have been used for payroll). Loan payments will also be deferred for six months. No collateral or personal guarantees are required. Neither the government nor lenders will charge small businesses any fees. 

Small businesses with 500 or fewer employees—including nonprofits, veterans organizations, tribal concerns, self-employed individuals, sole proprietorships, and independent contractors—are eligible. Businesses with more than 500 employees are eligible in certain industries.

To qualify for the loans, a small business must be:

• A small business with fewer than 500 employees
• A small business that otherwise meets the SBA’s size standard
• A 501(c)(3) with fewer than 500 employees
• An individual who operates as a sole proprietor
• An individual who operates as an independent contractor
• An individual who is self-employed who regularly carries on any trade or business
• A Tribal business concern that meets the SBA size standard
• A 501(c)(19) Veterans Organization that meets the SBA size standard

Starting April 3, 2020, small businesses can apply and on April 10, 2020, sole proprietorships, independent contractors and self-employed individuals can apply.  For more information on the Paycheck Protection Program visit SBA.gov/Coronavirus.

About Los Angeles Area Chamber of Commerce

The Los Angeles Area Chamber of Commerce represents the interests of business in the Los Angeles region. The Chamber’s mission is to design and advance opportunities and solutions for a thriving regional economy that is inclusive and globally competitive. Founded in 1888, the Chamber is the oldest and largest business association in the region. Its member companies work together to promote a prosperous economy and quality of life in the Los Angeles region. For more information, visit www.lachamber.com.