Mar 24, 2020

COVID-19 Financial Programs

Staff at MadREP are monitoring financial programs that are being developed at the federal, state and local level to help businesses cover expenses incurred during the period of disruption caused by the COVID-19 crisis. We are currently aware of the three programs summarized below. Check back frequently as we will be posting updates to this information, as well as documenting new programming, on our website.

Small Business Administration (SBA), Economic Injury Disaster Loans Program

This program will be available to Wisconsin businesses once the state has been declared a disaster area by the federal government. The Governor’s declaration is currently under review in Washington D.C. and could be approved as early as today (Friday, 03/20/2020). Following approval, businesses across the state and Region will be able to submit an application for assistance online. Please submit as soon as possible due to high demand. There is no fee to apply and no closing costs. Current funding is capped at $50B nationwide.

Eligibility: For- or non-profit businesses with less than 500 employees and less than $7.5 million in average revenue over the past three years; Net income must also be less than $5 million (after taxes and not counting carry-over losses). Eligibility guidelines vary by NAISC code. You can go to www.sba.gov/size to see if your business is eligible by size and revenue for your industry.

Key terms of the program include:

  • Loan Amounts: up to maximum of $2 Million per business
  • Interest: 3.75% for small businesses; 2.75% for non-profits. Interest beings accruing immediately.
  • Terms: No payments for twelve months from closing; maximum amortization period of 30 years
  • Collateral: Unsecured up to $25,000; over $25,000 will take collateral, but a loan will not be denied due to lack of collateral value.
  • For current and new small business clients, we are offering fast tracked loans up to $25,000!
  • Loan funds can be used as working capital to pay fixed debts, payroll and account payable during the disaster period.
  • Bridge loans (to keep the business afloat as a result of the disaster) can be paid down with the EIDL.
  • Insurance payouts can be used to pay down the EIDL without prepayment penalty.
  • Underwriting: dependent upon credit history, capacity to repay, and location in a disaster area.

Loan Package:

  • Loan application
  • Tax Information authorization
  • Copy of most recent Federal Tax Return
  • Schedule of liabilities
  • Personal financial statement
  • Year to date business financials

*Thanks to Kevin Kaufman, Director, SBDC at UW-Whitewater for all the detailed guidance.

Wisconsin Economic Development Corporation (WEDC), SB 20/20 Program

This program makes up to $5M available to five Community Development Financial Institutions (CDFI’s) to make grants up to $20,000 each to existing loan clients.

Eligible grant recipients include:

  • Current loan recipients in good standing as of 3/1/2020 with an approved CDFI
  • 20 or fewer part-time and full-time employees
  • Less than $2 Million in annual revenue
  • Preference will be given to service and retail businesses

Eligible Uses of Funds:

  • Two months of payroll and rent expenses up to the program maximum $20,000
  • Funds can also be used to cover paid leave (including sick, family and other leave related to COVID-19)

If you are a regional business looking for assistance, please stay tuned and check back for a listing of eligible CDFI’s.

Kiva Greater Madison

Kiva provides 0% interest microloans to local small businesses. In response to the effect COVID-19 is having on small businesses Kiva has increased the amount a business can borrow to $15,000, expanded their already low eligibility thresholds for borrowers and offer a grace period for repayment of up to 6 months. The loans, sourced through a crowd-sourcing platform, include no fees and are typically offered for three-year terms.

Eligible requirements include:

  • Must be 18 years of age
  • Must be living in and the business must be operating in the U.S.
  • Must use the loan for business purposes
  • Must have bank account
  • Cannot currently be in bankruptcy

Hmong Wisconsin Chamber of Commerce (HWCC), Emergency Loan Fund (COVID-19)

This program makes loans between $5,000 and $10,000 for working capital to cover rent, payroll and other fixed expenses for businesses adversely affected by the COVID-19 emergency. Loan application materials can be found on the Chamber’s website.

Eligible Applicants:

  • A for-profit business located in a low to moderate-income census tract or a minority owned business located in Wisconsin.
  • An existing business in operation for a minimum of two years
  • A business with less than 500 employees

Interest: Prime (5.50%) plus 1.5% to 5.5% depending upon underwriting

Terms: Interest only payment for the first three months; maximum amortization period subject to negotiation

Loan Package:

  • Loan application
  • Two years of Tax Returns (personal and business)
  • Year-end financials for 2019 requested, but not required

For more information please contact HWCC Operations Manager, Ger Thao: ger@hmongchamber.org

If other organizations are making funding available through programs that are not mentioned above, please reach out to us and we will get your programming added to the list.

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