New round of federal funds could be crucial for restaurants, hotels

This article from the Bellingham Herald is applicable to businesses hardest hit by COVID-19 throughout Washington State. The Center Director at Washington SBDC in Bellingham is interviewed. A few excerpts are below. Please see the full article here:

The $900 billion package was signed by President Trump on Sunday, Dec. 27, providing a wide range of financial assistance, including $600 stimulus checks and a new round of the Paycheck Protection Program.

A second round is needed because the first one missed many of the businesses it was intended to assist, said CJ Seitz, director at Western Washington University’s Small Business Development Center.

A special provision was written into the second round of PPP that focuses more help for the lodging and restaurant industries.

Seitz said the new provision will allow these businesses to borrow up to 3.5 times their payroll for the qualifying period. Also, more business expenses can be paid with PPP2 funds. Businesses like wedding facilities and other meeting places also qualify for special assistance, since most of them have been closed for more than seven months.

Business owners can soon start applying for PPP help. A few things to note about eligibility:

▪ The owner must have been in business before Feb. 15, 2020.

▪ Qualified businesses can be corporations, limited liability corporations, sole proprietors, self-employed and independent contractors.

The borrower must have used, or will use, all of any previous PPP loans it received.

Seitz offers these bits of advice for businesses on how to prepare:

▪ Get your facts together: Calculate your income by quarters, 2020 versus 2019. PPP2 borrowers will need to certify at least a 25% drop in gross revenues, minus PPP1, unemployment or other grants.

▪ Build a lender portfolio: Contact local banks, community lending institutions, credit unions and online lenders. Ask whether they’re going to participate in the next round of PPP lending. Get contact information for individual lending officers. Create a list of multiple lending sources.

▪ Watch for application openings: Monitor your selected lenders for application information and act quickly – the program will be rapidly overwhelmed with applicants so act fast.

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The Washington Small Business Development Center, hosted by Washington State University, is an accredited member of America's SBDC. Funded in part throurgh a coppperative agreement with the U.S. Small Business Administration, institutions of higher education, economic development organizations and other public and private funding partners.