New York State has launched a $100 million program on Tuesday to provide low-interest loans to small business owners and others who have been economically impacted by the Covid-19 pandemic and have not received one of the federal loans offered this year, Assemblyman Fred W. Thiele, Jr. announced on Friday.
Those eligible include businesses with 20 or fewer full-time employees and annual profits of less than $3 million, nonprofits that provide direct services, such as daycare and senior centers and food banks, and have an operating budget of less than $3 million, and landlords who own residential buildings with 50 units or less, and no more than 200 units overall. To qualify, all entities must have been in operation for at least one year from the date of the loan application.
Small businesses can apply for a loan of whichever is the lesser amount, either $100,000 or 100 percent of average monthly revenues in any three-month period in 2019 or the first quarter of 2020. For landlords, it is $100,000 or the projected reduction in three months' operating income based on actual reductions in operating income for the month of April or May 2020. For nonprofits, it is $100,000 or a three-month average of monthly expenses.
The fixed annual interest rate on the loan will be 3 percent for small businesses and landlords, and 2 percent for nonprofits. For each, interest-only payments will be due for the first 12 months.
Other requirements for landlords include that properties be either located in low or moderate-income areas or have rents affordable to tenants of low and moderate income, that property taxes through March are paid, and that they must agree to not evict tenants who, because of the economic shutdown, are not paying rent.
Starting Tuesday, the program began accepting pre-applications, but only from businesses in regions of the state that have reopened. The money, however, will be not be disbursed on a first-come first-served basis. Although the reopening of Long Island's economy begins on Wednesday, the state has designated 18 percent of the funds for the region, the second highest amount after the 30 percent planned for New York City businesses.
The state recommends getting the pre-application prepared as soon as possible. For assistance in filling out the forms, it recommends enlisting state programs such as the New York Small Business Development Center, entrepreneurship assistance centers, a community development financial Institution, and the Covid-19 Business Mentor NY Volunteer Task Force. The application process can be initiated at nyloanfund.com.