There are resources available. The key is knowing where to look.

As a business owner, you may have heard about the Paycheck Protection Program (PPP) loans, which are low-interest loans awarded by the Small Business Administration (SBA) to help cover payroll and some other operational costs. Assuming the loan proceeds are spent properly and other criteria is met, the loans could be fully forgivable – meaning you wouldn’t need to pay them back. Unfortunately, the deadline to apply for a PPP loan was August 8th, but most experts believe that Congress is going to extend the deadline in its next economic stimulus package. If you’ve already received a PPP loan, still keep a lookout for that stimulus bill, as there are proposals floating around for a second round of PPP loans for hard-hit businesses.

Alternatively (or additionally), you could consider more traditional Economic Injury Disaster Loans (EIDLs) awarded by the SBA. These EIDLs are usually for much larger amounts than PPP loans, have relatively low interest rates, and can be repaid over a period of several years. If you’re confident that you’ll be able to stay in business and repay the loan, an EIDL might be a good option to keep you afloat until then.

There are also state-level resources available, including a number of emergency grants and state-guaranteed business loans you might consider. The State of New Mexico Economic Development Department for example keeps an up-to-date list of COVID-19 resources on its website. One such resource is the Small Business Recovery Loan. In July, New Mexico’s legislature and governor approved created a $400 million fund for three-year, low interest loans up to $75,000 that require no personal guarantees or collateral and that require only interest payments for the first three years. These terms may be far more favorable to borrowers than an EIDL or other small business loan, but the maximum amount that can be borrowed is substantially less than one could borrower with other loans.

You might also have a look at your city or town’s website for additional resources. For example, the City of Albuquerque is providing grants to restaurants to expand their outdoor dining capacity. Resources change frequently, so it’s worth keeping on top of what’s made available each week.

Finally, you might want to evaluate the other overhead your business has to see if there are other costs you can reduce, defer, or eliminate altogether. I’ve spent a good deal of time over the past six months helping clients renegotiate their commercial leases, allowing tenants to defer several months’ worth of payments while extending their leases, keeping them in good standing with their landlords, and providing them with a financial cushion to let them keep the lights on, pay employees, and weather the storm. A good contracts attorney can help you understand your rights and help you negotiate with your landlords, many of whom are willing to work with their tenants to keep their units occupied.

Would you like to discuss your options as far as lease and vendor contract negotiations? Perhaps you would like to talk to an Human Resources Advisor about the steps involved in laying off or furloughing employees? Law 4 Small Business is here to help. Contact us today and let us guide you through the process.

Law 4 Small Business, P.C. (L4SB). A little law now can save a lot later. A Slingshot company.

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