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Mass. to receive over $3.8 billion to provide residents, business owners economic relief during pandemic

BOSTON — The economic fallout of the COVID-19 pandemic has been felt across the country, but residents and businesses in Massachusetts are now looking at some economic relief, besides the stimulus check provided by the federal government.

Small businesses have been forced to close or significantly reduce their workforce, but now, Massachusetts is set to receive over $3.8 billion to put toward transit, housing and energy assistance to help residents weather the crisis caused by the pandemic.

For business owners, the money will provide economic relief, mainly by helping keep employees on the payroll.

There are two key federal programs that small businesses may qualify for. The first is the paycheck protection program to keep small businesses from laying off employees, while the second is the economic injury disaster loan program to help with ordinary and necessary operating expenses.

Bob Nelson, the District Director of the Small Business Administration in Massachusetts helped explain the process and fielded some of our viewers questions about the federal programs available for small businesses.

25 Investigates Reporter Ted Daniel: “Bob, I know you are incredibly busy, thank you for your time. Let’s start with a question from John. He owns an HVAC business and wants to know if he’s approved for SBA help; how long will it take for him to get the money?”

Bob Nelson: “The decision could be made in 21 days; we’re being told that it could be another five to seven days for closing and funding of the economic injury loan. There have certainly been applications approved well below 21 days. The Payroll Protection Plan loan is different. It’s administered through banks. It’s my opinion that capital is going to be able to get out much quicker.”

TD: “Chris on Twitter wants to know about sole proprietors, people who work themselves and get 1099’s, are they eligible for help?”

BN: “Sole proprietors are eligible for the Economic Injury Disaster Loan Program. They’re also eligible for the Payroll Protection Plan. It’s two and a half times their average monthly payroll cost, that is the basis for the loan. We’re not going to cover salaries that are in excess of $100,000.”

TD: “Lance owns Hair Sessions Inc. He wants to know how the loan amounts will be decided?”

BN: “The economic injury loans go all the way up to $2 million dollars, but SBA will help the applicant to determine what loan amount the SBA is comfortable granting with respect to the economic injury and also looking at repayment ability.”

TD: “What are the interest rates and fees for the loans?”

BN: “The SBA Economic Injury Disaster Loan Program, the interest rate for small businesses is 3.75%. That’s fixed for the life of the loan, the term can be as long as 30 years. There are no fees. With the Paycheck Protection Plan program. The interest rate is point 5% and it’s a term of two years. Under the Paycheck Protection Plan loan, there is the ability for that loan to be forgiven if the small business is able to maintain its employee base.”

TD: “What’s the best way for people to get information?”

BN: “What I would suggest that people do is look at the borrower fact sheet, which is on Treasury’s website. It’s the best guidance I have right now. SBA economic injury disaster loan program, small businesses and private nonprofits would apply through [their website].”

TD: “Thank you so much for taking the time to speak with us. Best of luck. I know you guys are going to be very busy ahead.”

BN: “Thank you very much, Ted. I appreciate the opportunity.”