American Rescue Plan For Nonprofits – More Monies For Charities is INSIDE CHARITY’s update on what funds are still available from the Federal Government through the American Rescue Plan of 2021.
The EIDL program has been around for years, but in March of 2020 the SBA elected to expand the definition of eligible nonprofits to include those affected by the coronavirus pandemic. This allows charities who suffered from economic injury, such as a drop in revenue or an increase in expenses, to apply for low-interest loans. Additionally, the CARES Act implemented a first-time EIDL grant, which is available to all applying businesses even if they choose not to participate in the loan program. In the Coronavirus Response and Relief Package additional funds were set aside to extend the grant the program created by the CARES Act, as well as create a new program to nonprofits most affected, that are located in low-income communities.
EIDL Loans
On December 30, 2020 the SBA announced that the deadline to apply for coronavirus-related EIDL loans will be extended through December 31, 2021.
You can apply for an EIDL loan directly with the SBA here.
On March 12, 2021 the SBA announced that all SBA disaster loans, including EIDL loans made in year 2020 will have the first payment due date extended by an additional 12 months, for a due date of 24 months from the date of the note. Additionally, SBA disaster loans, including EIDL loans made in year 2021 will have the first payment due date extended by an additional 6 months, for a due date of 18 months from the date of the note.
On March 24, 2021 the SBA announced that they’ll be increasing the EIDL loan limit to $500,000, up from $150,000. The change will be effective April 6, 2021, and will cover up to 24 months of sales, so a business that had $100,000 in sales and previously received $50,000 is now eligible to receive up to $200,000. On April 6, 2021 the SBA started the process of emailing EIDL loan recipients with information on how to request an increase under the new EIDL calculations. Unlike previously announced, an official increase request will be required to receive the increase, and unsecured personal guarantee will be required for loans over $200,000 from all 20% owners. No real estate collateral is required for loans under $500,000.
The SBA has now added the option of requesting an increase to most applicant’s online portals, which automates much of the process. You can still request an increase via email if you prefer:
EIDL Targeted Grant
The EIDL Targeted Grant does not have a public application, instead applicants must first apply for a loan, and will then be invited to apply for the EIDL Targeted Grant. You can apply for the loan just to receive the Grant invite, without proceeding to accept the loan. The EIDL Targeted Grant program offers funds to businesses in low-income communities that suffered at least a 30% decline in gross receipts over 2 months. The application deadline for this program will be December 31, 2021.
On March 11, 2021 the American Rescue Plan was signed into law. The Act includes an additional $15 billion in funding for Targeted Grants, and creates the Supplemental Targeted EIDL Advance, a $5,000 grant for businesses with a 50% loss and less than 10 employees. See more on Supplemental Targeted Grants here.
Eligibility
Grant Calculation
Application Process
The SBA will be reaching out to notify all grant recipients that received grants of less than $10k, as well as all applicants who applied for a grant or loan after funding had been depleted, of their eligibility for this grant. Potentially eligible businesses are divided into three groups:
The SBA urges all businesses that have not yet filed a 2019 return to do so, as this will be required to receive the Targeted Grant. Additionally the SBA will request monthly gross sales for each month from January 2019 through the most recent month, to verify the 30% drop in sales that is needed to qualify.
The SBA expects to disburse funds to eligible applicants within 21 days of the application requirements being satisfied. The SBA has not been keeping to this timeline.
Application Steps
New Targeted Grant applications sent out after April 21, 2021 include an option to request the Supplemental Grant as well.
Appeals
While the SBA originally did not allow for an appeal process, they’ve denied many applications in error, and are now allowing those applications to appeal.
To appeal what you feel was a wrongful denial:
EIDL Supplemental Targeted Grant
On March 11, 2021 the American Rescue Plan was signed into law. The Act includes funds to create the Supplemental Targeted EIDL Advance, a $5,000 grant for businesses located in low-income communities that suffered a 50% decline in gross receipts over 2 months, and have 10 or fewer employees. To qualify a business must have already received the EIDL Targeted Grant- no application will be available, instead the SBA will reach out to EIDL Targeted applicants to inform them of next steps. The maximum allowable grant from both programs combined is $15,000.
New Targeted Grant applications sent out after April 21, 2021 include an option to request the Supplemental Grant as well.
EIDL Grant Round 1 Changes
This section will be updated once the SBA releases further guidance and details.
American Rescue Plan For Nonprofits – More Monies For Charities was first posted at INSIDE CHARITY.
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