Small businesses that received $50,000 or less of Paycheck Protection Program assistance can now apply to receive low-interest loans from the New York Forward Loan Fund, according to Empire State Development.
The fund, which launched in May, was originally designed for businesses that did not receive PPP funding, based on rules provided by the federal Small Business Administration.
“The coronavirus pandemic was an unprecedented challenge to the state’s business community, of which 98% are small businesses,” Eric Gertler, ESD’s acting commissioner, said in a statement. “Providing assistance and opportunity — particularly to our state’s minority- and women-owned businesses — to help them reopen is essential toward revitalizing our economy and building New York back better.”
More than $116 million in PPP loans were issued to North Fork businesses, representing more than 1,500 small businesses, according to data released earlier this summer. There were 651 businesses in Southold that secured funding during the first three months of the program. In Riverhead Town there were 853 companies. The data did not specify how many businesses received $50,000 or less. The lowest threshold reported was under $150,000, which represented the majority of businesses.
Businesses that received under $150,000 were not named. On average, they received about $36,000.
Some applicants who then applied for NYFLF relief were deemed ineligible because they had received PPP funds, according to ESD.
“Through discussions with lenders and applicants, it became apparent that PPP loans did not go far enough to support New York-based small businesses,” a press release noted. “Legislative criteria restricted how the government assistance could be spent, and oftentimes PPP amounts were a fraction of what was needed and requested.”
In August, Governor Andrew Cuomo announced that $2.3 million had been awarded to support 61 businesses and residential landlords with COVID-19-related costs. Of those loans, 54 went to minority-and women-owned businesses.
The NYFLF Community Development Financial Institution has started to contact previously ineligible applicants to determine if they are still interested in funding and begin the underwriting process. The program has set a goal of providing at least 60% of loans to minority- and women-owned business enterprises.
Eligible small businesses and small residential landlords can apply for a 60-month, no-fee loan with a 3% interest rate, with a maximum value of $100,000. The PPP loans, by contrast, had a 1% interest rate and could be forgiven. They were also for higher totals of up to $10 million per applicant. Eligible nonprofits can receive the NYFLF loan at 2% interest.
“Loan funds can be used for working capital including payroll, operating and emergency maintenance, property taxes, utilities and costs associated with refitting physical space to follow social distancing guidelines,” according to the ESD.
More information is available online at nyloanfund.com.