The U.S. Small Business Administration, or SBA, issued a statewide disaster declaration Wednesday for Georgia, making small businesses and private nonprofit organizations in all of the state’s 159 counties eligible for SBA disaster loans if they experience economic injuries from the coronavirus crisis.
A disaster loan page specific to COVID-19 in Georgia opened on the SBA website one day after Gov. Brian Kemp submitted a letter asking that the loans be made available here. The SBA declaration also extends to counties that immediately abut Georgia in Alabama, Florida, North Carolina, South Carolina and Tennessee.
Loans will be available in amounts up to $2 million. The interest rates are 3.75 percent for small businesses and 2.75 percent for private nonprofit organizations. Terms are established on a case-by-case basis, with long-term repayment up to 30 years possible.
"This is great news for Georgia small business owners,” Kemp said in a press release from his office Thursday. "As we continue to navigate the impact of COVID-19 on our economy, small business owners can apply for much-needed funding to continue operation and pay their employees. My thanks to the Trump Administration for their swift action to protect small business owners throughout the country.”
The SBA webpage for Disaster No. GA-00116 shows the incident period as beginning Jan. 31 “and continuing.” Potential applicants can visit https://disasterloan.sba.gov/ela for information and the application.
After receiving Kemp’s request, the SBA acted under its own power to declare a disaster. This authority was provided by the Coronavirus Preparedness and Response Supplemental Appropriations Act that the president recently signed, the SBA’s own news release stated.
For the SBA’s purposes, a small business is generally one with fewer than 500 employees.
In addition to small businesses, private nonprofit organizations of any size, small agricultural cooperatives and small aquaculture enterprises financially impacted as a direct result of the coronavirus can qualify, SBA Administrator Jovita Carranza said in the release.
“These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact,” Carranza said. “Disaster loans can provide vital economic assistance to small businesses to help overcome the temporary loss of revenue they are experiencing.”
To qualify, a business will have to demonstrate an economic injury that occurred because of coronavirus effects such as closures or staff layoffs, SBA Public Affairs Specialist Carol Chastang said in a reply email to the Statesboro Herald. Those are examples she gave and not the only effects that might qualify.
“Each application is reviewed on its own,” she wrote.
Unlike some other SBA programs, in which the agency backs loans provided by commercial lenders, the SBA disaster loans are backed directly by the federal treasury. Currently there is $7 billion in SBA’s budget for disaster loans, Chastang replied.