Businesses around the nation and the state are being impacted in a serious way by the COVID-19 emergency declarations and the related restrictions on public activities during shelter in place proclamations.
Locally, according to Julie Foster, Executive Director of the Ravalli County Economic Development Authority, the emergency is presenting a lot of problems to almost every business. Some, like Fords Department Store, have just been shut down. Alan Ford, owner of the family clothing business that has survived for generations on Hamilton’s Main Street, said that he still comes down to the store and putters around. He doesn’t expect to go out of business from the closure, but he is thinking of taking out one of the emergency loans being offered by the Small Business Administration (SBA) to weather the storm.
“We have never had to take out a loan before,” said Ford. He said the fact that it comes with the potential of being forgiven makes it attractive.
As part of the $376 billion in funds made available through the CARES Act, signed into law on March 17, the Small Business Administration is sponsoring three loan programs directly related to the COVID-19 impact relief: the Paycheck Protection Program; the Economic Injury Disaster Loan Advance (EIDL); and Express Bridge Loan program.
The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll. SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.
You can apply through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program. You should consult with your local lender as to whether it is participating in the program.
Lenders were supposed to begin processing loan applications as soon as April 3, 2020. The Paycheck Protection Program will be available through June 30, 2020.
The SBA’s Economic Injury Disaster Loan provides vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing as a result of the COVID-19 pandemic.
This program is for any small business with less than 500 employees (including sole proprietorships, independent contractors and self-employed persons), private non-profit organization or 501(c)(19) veterans organizations affected by COVID-19. Businesses in certain industries may have more than 500 employees if they meet the SBA’s size standards for those industries.
The Economic Injury Disaster Loan advance funds will be made available within days of a successful application, according to the government’s website, and this loan advance will not have to be repaid.
The Express Bridge Loan Program allows small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 quickly. These loans can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing and can be term loans or used to bridge the gap while applying for a direct SBA Economic Injury Disaster loan. If a small business has an urgent need for cash while waiting for decision and disbursement on an Economic Injury Disaster Loan, they may qualify for an SBA Express Disaster Bridge Loan.
RCEDA Director Julie Foster said that while these government programs are a good thing on the whole and she suggests that local businesses check out the options, she said, “These programs are out there, but there are people that are going to fall through the cracks in a pretty big way.”
Foster said that employees making low wages because they make tips are going to find it hard to get by on unemployment payments.
“If this goes on for very long there are going to be a lot of people hurting and a lot of businesses that will not be able to recover and reopen,” said Foster. She said lots of different businesses are being affected in different ways. Some are experiencing disrupted supply chains and are either unable to receive raw materials and others are having shipments delayed elsewhere or cancelled en route.
“Some people are trying to stay open,” said Foster, “Restaurants are doing take-out, but most people are staying at home.”
“The government is dumping a lot of money into this,” said Foster. “You can just print more money. But there’s a limit, at a certain point your money becomes worthless.” She said there was a small window here for many small businesses to survive if they receive enough cash quick enough. “If this just lasts for a month or so and a small business was viable, with a little boost to get through this they might be able to get going again,” she said.
But they also need money right away, according to Foster, and she is not so sure that the current loan programs are going that smoothly at the bank.
That’s what makes the local efforts of the Hamilton Downtown Association so important, she said.
According to Hamilton Downtown Association executive director Claire Kemp, recognizing the vulnerability of many local businesses to this unprecedented shutdown, a subcommittee of the association met to consider potential actions and the result was the establishment of the Hamilton Business Relief Fund. A GoFundMe campaign was initiated to raise money to help the businesses stay afloat during the crisis in order for them to continue operations and bring back employees once it ends.
Kemp said the site had been shared over 361 times last Friday and that the fund had already generated $9,250. Kemp said that giving the business applicants cash was an important part of the fund. She said other efforts to support local businesses, like buying a gift certificate to use in the future can, in some instances, just push the cash crunch forward to the time when all the customers come in with gift certificates. She said that by giving cash instead, the business can avoid that potential future draw back.
You can learn more about the effort by going to https://www.hamiltonbrf.com/ The website offers the location of the GoFundMe site and an application for businesses that may need assistance.
In an effort to help out the Hamilton Business Relief Fund, Bitterroot Trout Unlimited has issued a Corona Bug Challenge to all fly tyers in the valley. You are invited to design and tie a fly that you think merits the name “Corona Bug.” Entries can be a dry fly, nymph, streamer, wet fly or anything in between. Entries will be accepted through midnight on Thursday, April 30. You can enter as many times as you like.
The entry fee for the competition is a minimum $5.00 donation and after submitting your entry you will be directed to the Hamilton Business Relief Fund GoFund Me page to make your donation.
All the entry fees go to the Hamilton Business Relief Fund. These local businesses are the life blood of our community and support the local TU chapter’s programs and fundraising. Even if you are not going to enter, you can make a donation to the Hamilton Business Relief Fund.
An anonymous panel of expert tyers will select the winning entry, and the winner will be featured in Bitterroot Trout Unlimited (BRTU) E-News. Of course, there will be prizes for the top entries, including a case of Corona beer. BRTU is working with Montana TU to challenge other TU chapters in Montana to do a similar competition for their communities. When all the competitions are over, Montana TU will empanel judges to select “the best of the best.”
Entry forms are available on the organization’s website at www.bitterroottu.org