AUSTIN (KXAN) — Some relief is on the way for some businesses and nonprofits worried if they will make it past the outbreak. Starting on Friday, businesses and nonprofits with 500 or fewer employees will be able to apply for a loan under the Paycheck Protection Plan.
It’s part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The $350 billion will help struggling businesses pay its employees.
“People who work want to be working in general, and so my hope is that we can keep them happy and healthy and continue to take paychecks home to their family,” Dr. Gerard DeSantis, orthodontist and owner at The Ranch Orthodontics said.
He plans to apply for a Paycheck Protection Program loan.
The loans are 100% federally guaranteed, and the Small Business Administration said it will forgive the loans if all employees are kept on the payroll for eight weeks.
The money must be used for payroll, rent, mortgage interest, or utilities incurred before February 15 of this year. Those interested can get up to 2 and a half times the average monthly payroll costs as long as it does not exceed $10 million.
The Ranch Orthodontics consists of locations in Steiner Ranch and Hutto with a team of 11 employees. DeSantis’s monthly payroll expenses average out around $40,000 and if approved for a loan could receive around $100,000. He is hopeful and wants to make sure his employees have a paycheck during this difficult time.
For now, businesses and nonprofits can apply for the loan. Starting April 10, independent contractors and self-employed individuals will also be able to apply. If borrowers are required to pay part of the loan back, they’ll have two years to do so.
In order to qualify, borrowers must have been in business before February 15 of this year. If interested, the Austin Chamber of Commerce suggested borrowers should check in with their bank or credit union.
“Our small businesses are pressed for cash right now because of this pandemic. This loan program will help them cover their payroll, utilities, rent, any mortgages and help them push through this unprecedented time,” Dana Harris, the vice president and federal/state advocacy at the Austin Chamber of Commerce said.
The Paycheck Protection Program is available through June 30, but officials recommend those interested should apply as soon as possible since there is a funding cap.