Small Business Town Hall with Congressman Correa

so if I can I'm going to turn over the microphone to Christopher lorenza who will talk for a few moments about this package welcome Christopher thank you very much congressman and uh thank you everybody who's able to join us uh on this call once again my name is Christopher laurenzana and I'm representing the local the Orange County Inland Empire small business administration uh SBA district office our director is Alberto kihala and I am the deputy director um my purpose on the call is to to let people know that they have a local resource our district office is open and operational and I want to just share a few of the resources available for small business owners and then Mike Hill from the Small Business Development Center which is an SBA powered resource partner will Pro provide more information on State and local resources and what the sbdc is doing to help businesses during this time of need um first of all let me touch on the the the biggest program that the SBA currently has to get Capital into the hands of small business that would be our economic injury disaster loan or our Idol loan the web the only website to go to in order to apply for this loan is sba.gov disaster once again it's sba.gov disaster uh the website portal was revamped over the weekend and so it's much faster to go through the process should only take about I'd say maybe half an hour for most businesses to complete uh everything that they need to do one vital component of the disaster Loan program is what is called the idle Advance Loan and that is funding of up to $10,000 per small business and there's a box to check in the idol application portal and it'll ask would would you like to be considered for an idle advance of up to $10,000 I am recommending that every business check that box I'm already hearing from business owners that did not and they're asking us to how to go back into the application portal and check the box so to save us all of that trouble just check that box from the get-go um and let me just give you a quick detail about that so the E the economic injury disaster Loan program provides small businesses and nonprofits with working Capital Loans of up to $2 million the terms are 3.75% for small businesses and 2.75% for eligible private nonprofits uh up to 30 years term and up again up to $2 million but the key part of the advanced loan is that there is a up to $10,000 Advance on that funding that can be made within three days of a successful application and the the advance will not have to be repaid so it's what we call a forgivable loan the second item of assistance that just came out uh a press release came out today and I know a lot of people are are trying to get information about that and that's what we're calling um the PPP or the P3 loan the paycheck protection program that was part of the cares act that the congressman described um and that authorized uh up to $349 billion for for this loan program we are just now getting um the the press release out and fact sheets and other information is is coming but I want to touch on some of the uh the terms that were just announced so this is for all eligible small businesses including nonprofits veteran organizations sold props self-employed individuals independent contractors and and similar organizations the loan amount is set um for up to $10 million the interest rate will be half a percent the maturity on this program will be two years with the first payment deferred automatically for six months the unique thing and lenders will uh will appreciate hearing this is 100% guarantee by SBA and it requires no collateral no personal guarantees and there are no additional borrower or lender fees payable to the SBA the the guidelines for this program are being finalized as we speak we expect this loan program to launch um by this Friday and people will apply for this program through their local community lender or who they do banking with already on top of this I'll stop for now and I'll chime in in a little bit with other loan programs that we have available that we're calling our Bridge loans and so that's to get Capital into the hands of people while they're applying for the economic injury disaster loan but I'll just stop for now and then I'll I'll pick up uh later on in the call thank you Congressman thank you very much Christopher Ellen Harrington if you could share a few words with us thank you very much I greatly appreciate the this opportunity congressman and it's nice to meet all your constituents virtually I have to commend Chris because he really provided a terrific overview of the programs and the one thing we do want to highlight is with the idle grants when that was being crafted the Genesis of that was how to get money into the hands of small businesses quick and with that there you can go ahead and apply for that loan through SBA as Chris had said it's a direct loan and you can apply for a $10,000 Grant and that decision will be made within three days and that was the goal of that program right there um even if you are denied the loan you do not have to pay back that $10,000 advance and the other program that is valuable as Chris had mentioned is the SBA paycheck protection act and that provides very low interest cost loans up to $10 million or 250% of your annually monthly payroll costs and up to eight weeks of that um up to eight weeks of that payroll mortgage rent utility Is Forgiven so we greatly appre you know we these are opport these are great opportunities for small businesses thank you now I'm gonna have Mr uh Matt Gomez loan counsel with the house committee and small businesses Matt welcome thank you Congressman for uh for for bring us on and it's great to meet your constituents here electronically um I would add one thing and that is to say the program was designed to um as they all are enhanced access to capital for small businesses but we were designing it to try to get more lenders to to participate uh lenders who may not typically participate in 7A um so I would the message to to the constituents and to the borrowers out there is to um reach out to your current lenders and the bankers who have a Rel relationship with see if they're in 7A and if so are they going to participate in PPP um if they're not already in 7A are they gonna join 7A because of the PPP um and it's also a really good opportunity I think to to shop around and for small businesses to expand their network of lenders um expand their banking relationships um work with institutions you don't normally work with if you're normally at a big Bank maybe your local credit union is getting involved maybe there's a local cdfi that's interested in getting involved and is has the appetite and the capacity to make more small dollar loans um so it's true that the max loan size is capped at 10 million but maybe there's a a young minority owned startup who doesn't need 10 million or even a million they need about 100 thousand it's true that those loans are not as profitable for the big Banks to make so I would encourage folks to work with credit unions work with cdfis and other um you know less traditional lenders because we are opening up the program to as many uh lenders as possible um so that's one uh detail about the P3 program that is a little bit different from uh 7A thank you very much Matt anything else okay uh we're going to turn to Mr Mike Hill Small Business Development Center on how to apply for some of these loans Matt well excuse me Mike I'm sorry Mike oh thank thank you congressman and thank you very much for putting a form like this together there is uh the sbdc as you know maybe not all your constituents might know but we are a center that is predominantly focused on helping businesses start and grow that's our tradition that's our history um and and we've been very successful at that but right now we're really more about how do we help save these companies and provide the information and sort of navigate through it and so what the SBD Centers do and here in Orange County in the Inland Empire that's our local network we have multiple locations multiple centers some centers specializing on tech companies some on more traditional businesses restaurants and Retail but what we're doing today is where because there is so much information coming out and it is changing so quickly Christopher had mentioned that the new portal has changed for the idol loan as Sunday and I think that went live about four o'clock and so people had applied for some of these loans prior to that so there's a lot of questions there's a lot of information out there there's a lot of rumors out there what are these programs who can get them who's eligible the resources that are available today are really excellent but what we're doing at the spdc is we're helping small businesses walk through that process if you have questions about how to get the loan do I qualify for the loan what happens if I've already let go some of my employees and I apply for a loan and now I get it how do I use those those funds am I still eligible we're going to hold your hand literally hold your hand and walk through that process so our SPD centers are trying to make sure that the information businesses get are factual and that we have a very deliberate and purposeful um action on how to get these loans and to make sure that the information so if you get stuck or you get confused and you need some help that's what we're there for and Congressman I know you've been very supportive in the work that you've done um back in the house to to make sure that this happens this resources is is here for that I think we've had over a thousand calls in the last week and a half um but our response rates have been unbelievable average is 15 to 30 minutes getting back to businesses that are calling so you're not on hold forever we're booking appointments in advance and there is a consultant ready to help so that's predominantly what we're doing right now uh our Center is the Cal State Fullerton Center um and Cal State Fullerton's been amazing for us but but we're at UCI we're we we're at Riverside where wherever we can be to kind of make sure that this information is being utilized properly and that businesses are are navigating through it and having a good chance at getting these loans quickly and getting the information correct that's really what we're all about today so Mike we've got a situation where regulations are changing on a day-to-day basis almost at an hourly basis uh web pages are crashing these small businesses are trying to make payroll many of them very much in difficult situation are if they call your office Mike are they going to are you going to be able to walk them through these applications processes are you going to be able to help them to see if they can qualify for these loans before they have this closed down shop so Congressman first of all I I appreciate that question very much those are the calls in fact you're right those are the calls that we're getting every single day um Let me Give two resources out first a phone number this is the 800 number to the SPD center it's 800 616 7232 or 800 616 sbdc to very directly answer your question Congressman yes absolutely that is our mission that is what we are focused on we will make sure that these businesses we will literally walk them through the application if necessary to make sure that they don't get stuck that they don't get confused that the information that they're providing is accurate and complete so they have the best chance of getting these loans approved that is our primary mission right now well we also have a website you can go to OC Orange County Inland Empire so it's oci small bus.org and on that website we have information guides and resources that will that we have put together on our own that try to synthesize and bring together all the information that's out there and we update it very frequently to make sure that it's as accurate as it possible possibly can be we also have a link where they can click and and book an appointment with a business consultant who will become their Advocate their Ally and work with them through this process and in in addition we are hosting regularly events like this great event we are doing that on a daily every other day we're teaching businesses how to work through those applications what they are who's eligible how to use them we're doing that very very frequently and we have a just unbelievable particip from the spdc network uh to make that happen so again the universities have been amazing Cal State Fullerton and and the resources have been unbelievable but the biggest confusion sir frankly is because information is changing so quickly businesses are calling us really confused and so our job is to help them kind of get through that make sure that they understand these are the facts everything else we speculating for example Christopher was mentioning the PPP or the P3 loan uh that's to help with with payroll we know that's being changed the the the operating procedures are being changed and so we expect to see some new information out at the end of this week early next week and when that's available we will absolutely be ready our Consultants will be ready to to to share that information get it out there and make sure that businesses have accurate information so thank you very much for that question well Mike how much is this going to cost a a small business that calls in for some help I love it when I get set up questions Congressman that's such a great question you have already sir you and your colleagues have already made sure that these resources are 100% free so the consultants and the time that we spend with businesses there will never be a charge if you are talking to someone who is trying to navigate you through this stuff and they're charging and there are frankly there are people out there they're charging a lot of money for this but at the sbdc we do this all for free it's already been paid for through your taxpayers and very generous grants from you know you guys have made that money available these resources are here and now we are just making this available for free and Mike I you bring up a good point which is a lot of people are selling snake oil out there uh magic potions and and Magic loans and I hope people take advantage of of what we're already paying for which are your services and call in do not wait until uh you you're closing down shop this is available now and I know there's a lot of frustration uh after all th this is a crisis that's on us uh this is not an issue of a blame game this is an issue of how to fix it and move forward so Mike what is that number again 1 800 uh 616 7232 uh I just called it again right before we jumped on this call to make sure that we are being completely responsive and the phones are being answered three or four rings and the phones are being answered so it's 800 616 7232 or SB BDC thank you very much Mike we'll get back to you uh and now I want to turn the the microphone over to V Dean with the US Chamber of Commerce thank you much Congress welcome thank you thank you so much sir for putting this forum together and also for all your leadership with small businesses and local Chambers of Commerce in your District we know we can always count on you for support when it comes to helping small businesses and this is just one one other example of that the US chamber we know that small businesses out there are struggling right now we know how difficult it is for you and we know that all of you want nothing more than to reopen your businesses rehire your employees or get your employees back to work fortunately there are some very very robust programs right now that will get us through the next couple months as our federal officials and our state and local officials try to create a plan for how we're going to get our nation back to work but in the meantime we highly encourage you to take advantage of some of these programs that SBA and the treasury are offering right now the PPP program the paycheck Protection Program is one of the most robust programs that we've seen in the history of this country at the US chamber which will create a Lifeline for the small businesses out there and so we encourage you to to look into these options because quite frankly you know the PPP program is a loan but in many ways it turns into a grant if you if you spend it the right way um we've been talking to a lot of small businesses out there who have in the last few days or in the past week have have decided to shutter their doors and now that we have some of these options available we encourage you before making any decisions to close down your businesses please take a look at these programs that are offered either the idol loans or PPP or many of the other services that the SBA and the local sbdc offer um we encourage you to to take a strong look at them um because if you hang in there we can make it through the storm and we can get we can get our businesses and our countries up and running again it might take a little time to go back to the low unemployment levels that we had just a few months ago might take time to get to the to the GDP growth that we saw in January but we're confident that by using these programs that are being offered right now they'll create a bridge into getting us to the other side of this of this problem at the US chamber we've been really gearing up for these programs whether it's the idol program or the PPP uh we've put together a a guide and checklist for the for the pppp I encourage everybody on this call to check that out you can see it at uschamber.com SB loans it'll walk you through to make sure that you know that you're eligible it'll tell you what what uh what paperwork they'll look at uh when offering you these loans and you know like many of you on this call we're waiting for more guidance uh from the SBA and from treasury to see what all this will entail but in the meantime we've put together a pretty robust guide that we encourage you to look at and um thanks again Congressman we're looking forward to taking um some of the calls today and Von thank you very much for your comments I I I want to Echo what you just said which is uh part of the reason this $2 trillion package was passed was to make sure the economic slowdown is one vshape meaning we bounce right back after we figure out how to address this issue uh so I I I'm with you I encourage folks before you close down shop please call and see what Aid is available to make sure that you stay in business easier said than done but uh uh we're counting on you and if I may any further questions thoughts comments from our uh panelists I I was just can add Congressman that's what we believe at the US chamber that we don't feel that any individual should go bankrupt as a uh as a result of the Corona virus we don't feel any business should s shut down any industry should close as a result of this and we're hoping that these these stop Gap measures that Congress has passed and I I really want to thank some of the committee staffers also who are on this call for all their work on this you guys turned that this thing around uh in in lightning speed and the members of Congress got together and and on a b Artisan basis and passed this thing and got it signed on the same day it passed in the house so thank you so much for all you do as well and thank you to Mike at for your work at SBC uh Von I I join you in commending our our staffers in Washington because this is a a trillion doll package two trillion that's a lot of zeros and we had to go in and our staffers did a lot of work uh to make sure that we came as close as we could to get it right the first time and I think you all did a pretty good job so Kudos and congratulations to all of you uh thank Congress oh I was just wanted to add and something I may should have said earlier is that um there was additional funding in the bill to ramp up staff at spa and of that 25 million is going to be used to prepare um materials and have resources in languages other than English too in case there are some small business owners that aren't um where English isn't their first language and second um amount of funding there was $265 Million available to increase the resources at the sbgc centers in women's business centers thank you very much one quick and if I just want to add one this is Matt here I just want to add one one thing Barton's absolutely right um you know Congress uh designed the um the the the P3 program uh to function like a very forgivable loan if you spend it the right way so um thank you for identifying that and I want to add just one thing for the borrowers out there who might be listening um you're hearing there's a disaster loan there's a P3 loan all these loans um that's a lot of debt service you know six months a year 18 months from now we designed the programs so that if you take out an idol um during for um for co9 during a certain period you can refinance that idle loan using a P3 loan um if you applied in the right time window so um it's we're not trying to add so much extra Debt Service that it becomes unsustainable um but please work with your sdc's locally um work with your lenders to make sure that you are able to refine if you do get an idol that you're able to refinance it with a P3 um Des again designed to minimize uh monthly payments six 12 18 months from now thank you it's it's interesting to uh watch some of the stories here on on Main Street uh mentioned earlier the uh uh that Brewery blinking owl Brewery here in Santana blinking owl uh spoke to the uh co-owner yesterday she told me she had to sell her uh wedding ring uh to stay in business and uh she figured out a need which was of course hand sanitizer and now her business is exploding but that's just an example of trying to think out of the box and trying to figure out what the new uh demands are for your products out there uh easier said than done of course it's it's very difficult stay in business but uh we can do this um um we in this office are spending substantial amount of time trying to connect small businesses that may be idle with local hospitals and others that may need the products that are not being manufactured right now uh we'll continue to work on them uh any other uh comments from the uh from the panelists before we go into the question and answer session Congressman if it's okay I'd like to just um share our contact information at the local district office because I know a lot of the folks listening in are local here to Orange County um and or the Inland Empire and so my direct email is christopher. laurenzana christopher. laurenzana L renz sba.gov and our main line number number is 71455 7420 and I'll Echo some of what you said earlier we are hearing reports of business owners uh or of businesses that are popping up reporting to help uh people walk through the idle application process of course for a fee but we put out a tweet yesterday night that um the SBA district office is there for that exact reason as well as our Resource Partners the this funding that the SBA is entrusted with that we then entrust Resource Partners with um is a lot of money that goes to the spdc and to score and to the women's business centers as well as our veterans business Outreach centers and I know that that's a very near and dear topic to you Congressman um these Resource Partners are the ones that are charged with helping on the ground folks apply for all of these different sources of fundings that uh that were describing to you today so there's absolutely no need for you to be paying uh some business business uh to help you with that thank you let me move on to our first question and and see which one of you can help answer it it uh this is a uh small Private Practice psychotherapist in sanana of course impacted by covid-19 uh any are there any loans available to me as a solar practitioner to keep my practice afloat during these next few months yes um yes this is Ellen Harrington with the policy director for the small business committee the pay um the the PPP loan and the idol are both open to solo practitioners yes so then we would recommend they contact uh Mike Hill or Christopher lorenza and begin the application process absolutely absolutely and and we're sorry Chris me to to jum on you there but but but absolutely and when you're going through those through those applications it's very simple you select that you're a sole prop so we can help you through that of course that's something that that we're ready to help you with second question I'm a PES control company applying for a small business Emergency Loan but the website is currently down for the SBA disaster loan application can somebody help me yes so we can absolutely help you we do have a mechanism in place in case the site for whatever reason at that moment is overwhelmed I can I can tell you though that over the weekend as part of this giant uh that we've been hearing about in the news and from you Congressman this giant public private partnership um it the the site was beefed up and uh bolstered over the weekend and so we should not be hearing any issues like that from what I was told literally the the site can now process 2,000 applications a second and so we shouldn't be having of those issues anymore if by some small chance there is some issue like that contact the district office or the spdc what's the number at your district office 714- 550 7420 uh obviously the least um uh likable option is to mail the documents in we have an email address that we can uh send that into the SBA office of Disaster Assistance we can send those documents on your behalf thank you next question veteran towing company interested in both small business loans which can help uh can be turned into grants and a tax credit to support our employees during this difficult time what government agency can we apply to and how long will the process take where can they go and how long is it going to take I I would suggest you contact us directly this is Mike with the sbdc again 8 800 616 723 to there are multiple loans for helping with specifically what you were talking about um and you would expect anywhere from three to four weeks turnaround and I know that sounds like a long time it was five days just recently but there has been a surge and there has been an increase but we will answer the call the minute you call and you will have a consultant working with you very very quickly to help you through that process next question what are the financial limits for payroll oriented loans from the SBA and other government agencies that are dispensing financial assistance for small businesses I would say the limits are not Financial but small business correct 500 and Below right they there used to be a this is Mike again there used to be a requirement um from a revenue perspective and it was industry specific uh that has been eliminated so as long as you have less than 500 employees you are eligible question from uh Tony oh go ahead did you have another thought going to say there are some exceptions to that rule in terms of they waved some of the affiliation requirements so if you own if you're in the hospitality or restaurant business and that you own um two or more restaurants and the total number of employees um constitute more than 500 you still may be eligible to apply for these loans because they did wave the affiliation War so that would be an exception another question from my neighbor Tony in addition to the voting loans to payroll to qualify as grants what about using these funds to expand inventories and Equipment purchases I think we're dealing with two two different kinds of loan programs here there's the idle program and then there's also the the paycheck Protection Program and you have to decide you have to look inside your business and decide which fits best for your situation um with the with a paycheck Protection Program as we mentioned there are opportunities to recoup some or to to keep that money without uh without having to to pay it back um but there are some limits for what you would U be able to to uh to have forgiven for example you would need to uh the funding would have to be used for payroll uh for rent or mortgage interest and also for utilities so for the for the PPP program it's a little more limited if you're looking for forgiveness um from our understanding if um if you spend money outside those areas that I described you it would convert to a regular loan which would be a four-year loan at 4% um the idol loans are uh are 30-year loans and so it it and uh and you don't necessarily have to use those only for for payroll there are other ways that you can spend that money so each each individual business needs to look at what uh what kind of money that they're looking for and how they want to spend it any other comments on that one yeah bartan I think that's that's a great point and a great distinction that you're making between these two major programs that we're discussing right now um again that's where the SBA and the sbdc and the other Resource Partners can help a business source of talk that out and figure out okay which loan should I go for first um or or maybe you go for both and you have to very clearly delineate what the business use is for those proceeds because at the end of the day you don't want to be stuck with a loan too much money you know you've got a Federal Loan now that You' got to pay back so you have to definitely have a strategy in place before you you accept these funds other comments from the the the paycheck Protection Program it's our understanding that uh that the government wants to get these in as many banks as possible there are SBA traditional SBA lenders but they want to expand this so that most banks that that folks have checking accounts in for their businesses will be able to process these loans and in an Ideal World what we're hoping for at the US chamber if this goes live because the PPP is not live yet if it goes live on Friday you want walk into a bank fill out your application we're hoping that by Monday or mid next week you already have those funds coming in that would happen in an Ideal World so what's the real world you know it just depends on how fast um the banks the banks will be able to process these I've heard that they want to process them in the same day so that by the end of the day you might be able to have access to the loan but you know I I'll see that I believe it in terms of how how some of these banks will will um will actually uh um use these loans and process them um and and the thing is since these programs are so new we're experiencing that a lot of small business people are contacting their Banks right now and the banks just don't have information about it so if you if you walk up to the teller at a bank they might not even have the information because the Department of Treasury won't be putting out their guidelines until I believe Friday um and once then Happ happens um I think more more banks will will know about this and will be able to process the loans thank you any other comments go ahead sure I just wanted to weigh in regarding um the speed with which these Banks um should be getting these loans out um typically under 7A many lenders who don't have delegated authority have to send their documents to the agency to get reviewed and approved um under the P3 program um all lenders will have delegated authorities meaning that they will not have to wait and send the documents to SBA for review and approval they can just uh approve the loans on their uh on their own keep the documents uh safely on site um and can make the loans a lot faster without having to get sba's approval um so we're we're expanding that uh delegated authority to all PPP lenders um so hopefully that uh will designed to enhance the speed but hopefully that will play itself out um and will enable lenders to make um you know maybe not same day decisions but maybe one two three day decisions that was our intent thank you another question from another one of my neighbors Tim he says please clarify do we apply for the loans via SBI or through our local Commercial Bank yes so Congressman so if we're talking about the economic injury disaster loan or what we call the idol loan that is directly through the SBA website at SBA .gv disaster if we're talking about the PPP or the P3 the paycheck protection program that loan will be made through directly through your lender through your community lender through your credit union through your local financial institution and to Matt's point the program was designed as a sort of a with with a massive call to action a surge from all of the lenders around the country to really um to to jump in really and and help uh get access into uh Capital into the hands of the businesses that need it any other comments from the panelists looks like that's it for our questions today what I want to conclude by uh thanking our panelists for being here uh and encourage our constituents to continue to work with us I'm here to answer questions to be a conduit of information I will give you again my phone number personally uh 71455 70 no that's SBA free advertising 714 559 6190 my phone 55961 90 and we're also here to help and also uh put you in touch with some of these folks that have been talking here with us today again my phone number 71455 n 6190 and again we work for you we're here to help um let's hopefully we'll do this again again any other questions please call our office 714 55961 190 I thinkk your panelists I hope you can do with us again uh something like this again in the next few days thank you very much