SACRAMENTO, Calif. — The CARES Act, $2.2 trillion dollar stimulus plan, comes with more than just personal checks for Americans.
There's almost $350 billion going straight to small businesses who have either had to close down completely or are struggling to survive, but the money isn't automatic.
You have to apply for help, but there's help out there to get small businesses back up and running.
"The goal is to get our businesses afloat, give them what they need to make payroll on a monthly basis, and allow them to keep their staff employed,” said Virginia Varela, of Golden Pacific Bank in Sacramento, Yuba City and Live Oak.
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Varela says there are several pieces of the CARES Act that are here to help. Those include:
- Updated business tax provisions
- Small Business Association [SBA] loans
- The Paycheck Protection Program
"That one [Paycheck Protection Program] is especially interesting because there's a forgiveness period, which means for a period of time you will not have to make payments on that funding. And, the goal is to get businesses up and running so they can pay their payroll, so they can keep their staff employed," Varela said.
She says the program lets the bank get funding up to 2.5 times what their payroll was for the past 12 months, which can encourage businesses to hire back their staff and get productions to where they were at before the crisis.
That will put people back to work but it might take some time before they businesses can starting running again. It depends on how long Governor Gavin Newsom's stay at home order lasts and how long it will take for the banks and federal government to get the cash to those businesses.
“The act was put out very quickly and the bankers are still waiting for guidance for example with the PPP program," said Varela. "So, we can make commitments, but everyone is working around the clock to get the money out."
For example, Golden Pacific Bank loan managers worked throughout the April 3rd roll out weekend of the CARES Act Business Stimulus to process applications.
The State of California and local municipalities will also have resources available.
"Get as informed as you can got to [the] SBA website, go to [the] IBank website, talk to your banker, and get ready, because the money will be flowing out sooner than later. And, they want to be prepared to [go] back to business in normal conditions ASAP," Varela said.
A final tip from bankers is to be aware of potential scams. Varela says people should go to the SBA website or your local chamber of commerce website to get reputable information and to work with people you trust.
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