April 7, 2020
NJGCA April 7th
Coronavirus Shutdown Update
HELP US KEEP GOVERNOR UPDATED
FEDERAL LOAN UPDATES
NJGCA MBP BANKS READY TO ASSIST
NJ GRANTS & LOANS
NJGCA WEBINAR RECORDING
REPAIR SHOP CREATIVITY
REMINDER VAPING FLAVOR BAN
We know that there is a lot of information below. The NJGCA staff has been working hard to keep on top of what is transpiring with the Coronavirus crisis in order to provide the latest information to you. That is our job. It is your job to read the information and stay informed. We will do our best to answer any questions that these updates are likely to provoke. We will all get through this difficult time one way or another. Please keep you, your families, and your employees safe!
We Want to Hear from You Help us keep the Governor Updated
We are feeding the governor's staff on a daily basis with additional closures, situations where there are no employees to work, and right now, very important is we are trying to feed the governor's staff with locations where the attendants have contracted coronavirus because they are unable to maintain the social distancing requirements. We've asked and we will continue to ask; even if you have already emailed us, it is important that you send us updates on the situation at your location and the situation at other locations that you have noticed. We need to know locations that are closing, especially locations where attendants have contracted the Coronavirus. Keep sending us updates, it is as easy as sending us a quick email. Also, please be sure that we never reveal the identities of you or anyone when we send these communications. We let the governor know that contact information is available but only with your permission. We will never reveal your identity. If someone does want to contact you we will ask you first. If you say no, your identity will remain protected.
Federal Loan Updates
We have heard from a number of Members who are having difficulty in terms of navigating the various loan and grant programs available. Though we have discussed these topics in previous updates, we did want to share some recent anecdotal information we are receiving from Members, as well as highlight some resources to help navigate these difficulties.
SBA's Economic Injury Disaster Loan Program (EIDL):
Yesterday we heard from a Member who applied for an EIDL loan. You'll recall that EIDL loans are available through the federal SBA, and that Congress approved additional funding for the program through the recently passed Coronavirus Preparedness and Response Supplemental Appropriations Act (the bill commonly known as "Phase 1"). This Member has been following the news, reading our communications, and has availed himself of reading ancillary resources to better understand the options for his business.
With this in mind, the Member filled out paperwork and applied for an EIDL loan with the SBA approximately ten days ago. After completing the application, he received a supplemental form to fill out, and then...nothing at all. In following-up on his application today, the Member discovered that all previous applicants are required to reapply for relief.
According to information outlined in a correlating news article, SBA has confirmed that all previous applicants are directed to reapply for relief on an updated and streamlined website HERE.
The reapplication is necessary after the SBA discovered security concerns.
If you applied for an EIDL loan, and have not been contacted regarding your application, we highly recommend contacting the SBA to confirm if your original application was discarded; then reapply on the new website (covide19relief.sba.gov/#/) if necessary.
Paycheck Protection Program Application Hurdles:
Since the program went live last Friday, we've heard from Members who are having difficulty in applying for a loan through the Paycheck Protection Program (PPP). You'll recall that PPP, created a $350 billion small-business relief program as part of the recently-enacted CARES Act. Small-business owners were directed to apply for loans at their local bank. Approved funding may be used toward payroll and employee retention, business debt, utilities, business mortgage or rent payments, and some related expenses like insurance payments.
Many Members have stated there is some confusion amongst banking professionals on how PPP is to be implemented, and it’s clear this is a nationwide problem. Some retail bankers do not know anything about the program. Others have been told that PPP applicants should only apply to their own banks. Though this is obviously preferred, in one instance at least, customers were denied for such an arbitrary criteria, that the bank was forced to change its policy.
Since the SBA would never be able to handle the number of loans being applied for, the CARES Act (which created these PPP loans) gave the responsibility to private banks and lenders. Part of the problem so far has been that things are moving faster than the Treasury Department has been able to keep up with. Treasury originally set the interest rate for these loans at 0.5% but increased it to 1% the night before the program was launched because banks were threatening not to offer the loans.
Banks are not required to offer these loans, and each bank is setting different policies. Generally, they are taking care of their existing customers first, and often based on the depth of that relationship. This is partly because they already have some experience with the individual and have already vetted them in the past. It's also partly because the banks are saying that even though the money they are loaning is coming entirely from the federal government, the administrative costs mean they will make little money and so are viewing the program more as a customer service offering. Bank of America was originally only considering someone as a customer if they had a preexisting loan, though they backed off that position over the weekend after significant blowback. Wells Fargo announced yesterday that they were now only offering the loans to businesses with fewer than 50 employees.
Right now, the only banks that can provide these loans are those that already have been certified to provide SBA loans. However, banks that were not SBA-certified can be approved by the Treasury to start offering PPP loans. This process is still being completed, but should be launched soon, allowing for more lenders to enter the market.
Thankfully we've heard from a few MBPs who stand ready to help anyone in need of assistance. These MBPs are available to help you apply for a PPP loan; but recommend that you first attempt to complete an application with your personal banker. If your local bank is not SBA-approved, they have been unable to help you, or they are merely taking too long to respond/process, you are welcome to reach out to either of them for assistance.
Lisa Peck of Kearny Bank
Please email Lisa with the following details at email@example.com:
(Please CC firstname.lastname@example.org)
Business Owner Name:
Owner's Cell Number:
Please be sure to mention that you are an NJGCA Member when submitting this information. Due to heavy application volume, please give Lisa 48-72 hours to respond.
Scott Seidman of Heartland Payroll Systems
Though Scott deals with payroll services for NJGCA, another division of the company (Heartland Capital) is available to process PPP applications for members.
Please email Scott at email@example.com, (Please CC firstname.lastname@example.org)
or call him at 908-334-4778, to get the process started.
Please be sure to state you are an NJGCA Member when reaching out to Scott.
Please let Nick@njgca.org know if you reach out to either of these MBPs!
While some businesses have reported that they applied on Friday and had money in their bank account the next day, it seems more likely that the turnaround will take 1-2 weeks.
NJGCA values the feedback and information we receive from our Members. The current crisis is changing on a daily basis. While our staff has worked hard to keep you abreast of changes as they occur, your anecdotes are valuable experiences to learn from and share with fellow Members.
If you are having difficulties, or learned something new during this process, please let us know!
New Jersey State Grants & Loans
New Jersey Economic Development Authority (EDA) program update: Hopefully you read closely the email we sent out last Wednesday and Thursday discussing the NJEDA grant program. As we suspected, these grants of up to $5,000 were hugely oversubscribed, with over 10,000 businesses submitted applications within the first 90 minutes. The amount of money in the program meant that only about 3,000 businesses would be able to get one of these grants. However, the head of the EDA said it is possible that more money will be allocated to this program in the future, and he stated that if it does it will go first to those who have already submitted applications. So if you haven’t already done so it is worth it to take a few minutes and fill out the short application form before the deadline on Friday (at 9am). You can read the link to the application HERE and you can read more about the program in our prior email.
The NJEDA has also provided details for the new loan program they are launching. Applications for this program launch on Monday April 13 at 9am. As with the grant program, we expect the first round of funding to be taken up extremely quickly, likely within the first few hours. So if you are interested in these loans, take the time to do the research and prepare the info you need in advance and set a reminder on your calendar to be in front of the computer in time for the 9am Monday launch. Taking the loan and/or the grant program from the NJEDA will not prevent you from receiving federal aid, and you apply for and potentially receive both of them as well as future programs. The EDA loans will not be forgivable, like the new federal PPP loans, but the terms may be more favorable than other types of SBA loans. You can get more details about this loan program and even see a copy of the loan application HERE.
NJGCA Coronavirus Webinar Available
Thanks again to Steven Horowitz, Alicyn Craig, and Mauro Tucci and his colleagues as CSG for a very informative webinar on Friday. We have uploaded a PDF of the slides as well as the recording of the webinar on our Coronavirus webpage at the bottom in the resources section.
Technicians with ASE certifications scheduled to expire on June 30, 2020, have been granted a six-month extension. All ASE certifications expiring on June 30, 2020, will be extended to Dec.31, 2020.
Repair Shops: Time to Get Creative
No question this is a tough time for repair shop owners. However since so many people are working from home, now would be a good time to remind your customers to get any maintenance done that they have either been putting off or keep putting to the backburner since time is always an issue to bring your car in for service. Now is the time to get creative to spark that interest. There are still cars on the road, therefore cars will still be needing gas and repairs. You should not stop thinking about how best to serve your customers. In fact, you should be thinking even harder about creative ways to serve your customers.
Vaping Flavor Ban in Effect April 20
As you may remember, Governor Murphy signed into law a ban on all flavored vaping products (other than tobacco flavor) back in January, which goes into effect on April 20. We know because of the downturn in sales that many of you are stuck with more flavored e-cigarette inventory than you were expecting at this point. Unfortunately, there is absolutely no appetite in Trenton to even listen to extending the deadline. They made clear when they passed this bill that they have absolutely no concern for the small businesses that sell these products. This is something that hopefully the wholesalers will work with you on, since the non-tobacco flavored products can still continue to be sold in most other states.