SBA programs ready to help small businesses

This year has been filled with unexpected challenges for everyone, but as the U.S. Small Business Administration's Illinois District Director, I've been especially attuned to the difficulties facing small business owners.

Like all of us, they've made countless adjustments to protect the health of themselves and others, all while striving to sustain the business ventures they have poured their lives into starting and growing. We know it hasn't been easy, and there are no clear answers for what lies ahead. But whether your small business is starting, expanding or recovering, the SBA stands ready to be your partner.

Fueled by aid provided via the CARES Act as well as traditional SBA lending programs, Illinois small businesses received more than $32.6 billion in financial assistance from the SBA in FY2020. For many small business owners, the Paycheck Protection Program played a vital role in helping them pay their employees and cover the rent this year, and the next step will be applying for forgiveness.

Borrowers can choose between three different forgiveness applications - a standard form, an EZ form (for self-employed individuals, independent contractors, and those who did not reduce wages or head counts, with some exceptions) and a simplified form (for borrowers with loans of $50,000 or less).

Small business owners can apply for forgiveness through their lender before their eight- or 24-week covered period ends (if the funds have been spent appropriately). Because the first payment on the loan is deferred for 10 months after that period, borrowers needn't feel rushed and should take the time to consult with their lender and the SBA website (www.sba.gov/paycheckprotection) to get their questions answered.

The SBA's Economic Injury Disaster Loan and EIDL Advance programs also threw a lifeline to thousands of Illinois small business owners that were affected by the COVID-19 pandemic this year. It's important for small business owners to understand how these programs differ from the PPP and each other.

• The Economic Injury Disaster Loan is a direct loan from the SBA with a 3.75% interest rate for businesses and 2.75% for nonprofits. The funds are designed to meet obligations and operating expenses that could have been met had the disaster not occurred. This loan cannot be forgiven. Applications are still being accepted at www.sba.gov/disaster.

• The EIDL Advance was a grant program that provided a quick cash infusion to business owners while they waited for other funding to come through. The amount of the grant was determined by the number of employees indicated on the EIDL application: $1,000/employee, up to a maximum of $10,000. This program is no longer available, but recipients who also received a PPP loan will have the amount of the EIDL Advance subtracted from the forgiveness amount of their PPP loan.

Additionally, SBA's traditional lending, counseling and contracting resources are still operating, with a variety of virtual options to allow all Illinois business owners safe access. Consider tapping an SBA-funded resource partner - such as a SCORE chapter, an Illinois Small Business Development Center, a Women's Business Center or a Veteran's Business Outreach Center - to talk through your recovery plan or brainstorm ideas to take advantage of an unusual holiday sales season.

Visit www.sba.gov/local-assistance and input your ZIP code to find a list of service providers near you. Please take advantage of these resources, and let us know how we're doing at www.sba.gov/feedback. We look forward to seeing your business grow.

• Robert Steiner is Illinois District Director at the Small Business Administration.