SIOUX FALLS, S.D. (KELO) — Small businesses who believe they have been harmed economically by COVID-19, or coronavirus, could be receiving financial help through the Small Business Administration.
The SBA has a COVID-19, or coronavirus, economic injury disaster loan program designed to help small businesses that have been economically harmed by COVID-19.
Governor Kristi Noem said in a news release Monday that small businesses can complete an economic injury worksheet to help in the state’s process to receive a disaster declaration from the SBA. States need that SBA disaster declaration in order for small businesses and private non-profits to be eligible for disaster loans, according to the SBA.
Maggie Seidel, of Noem’s office, said in a Tuesday email that once Noem has received worksheets from small businesses, those will be submitted along with a letter to the SBA.
States are required to make a formal request for a disaster declaration, Carol Chastang of the SBA said in an email response to questions from KELOLAND News.
“Once the U.S. Small Business Administration receives a request from the governor for a disaster declaration to help businesses that took a coronavirus-related financial hit, the declaration will be approved by the SBA within 48 hours,” Chastang said. “Once the SBA makes the disaster declaration, businesses in the declared counties will be eligible to apply for disaster loans. “
Small businesses, private non-profit organizations of any size, small agricultural cooperatives and small aquaculture enterprises that have been harmed economically by COVID-19 may qualify for disaster loans of up to $2 million, according to the SBA.
Chastang said the loans can be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact.
Loans to small businesses have an interest rate of 3.75% and loans to private non-profits have an interest rate of 2.75%.
Loan periods can be as long as 30-years. Terms are set on a case-by-case basis, according to the SBA.
Chastang said it can take up to two to three weeks to make a loan decision once the SBA has received the application.
The SBA website lists eligible loan areas which include California and Connecticut. Counties were specified in several states but, Chastang said entire states are being declared a response to COVID-19.
The SBA, in general, defines small businesses by number of employees, annual receipts and affiliates which relates to ownership.
Locally, about $700,000 has been raised in a One Sioux Falls Fund set up through the Sioux Falls Area Community Foundation, Sioux Falls Mayor Paul Ten Haken announced this morning. This fund is to help Sioux Falls residents avoid evictions and hardships if they are unable to work because of COVID-19.