What are farmers eligible for as part of the CARES Act signed by Congress a couple of weeks ago? Much confusion ensued following the signing.
“When this first was rolled out, Congress basically said, ‘Farmers: you are eligible,’ and within 48 hours the SBA (Small Business Administration) came back and said, ‘Farmers: you’re not eligible,’” said Indiana Farm Bureau Director of National Government Relations Bob White. “And so, there was a meeting of the minds that took about 10 days to figure that all out.”
White says farmers are eligible for the Paycheck Protection Program and the Small Business Administration disaster loan.
According to the SBA website, sba.gov, the Paycheck Protection Program loan will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent, and utilities. At least 75% of the forgiven amount must be used for payroll.
White says, as with any federal government program, there are hoops to jump through and it could get complicated.
“The key for our farmers is they have to find, hopefully their bank, or a bank that they have worked with before, or Farm Credit who was not eligible in the beginning but is eligible now, to work on SBA loans. Work with your local lender and they will help get you through the steps.”
White says Farm Bureau Bank is also now an approved lender.
Forgiveness of the Paycheck Protection Program loan is based on you maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease.
According to Reuters, Senate Republicans and the Trump administration warned on Tuesday that the $349 billion program could run out of money this week. Democrats and Republicans agree that an additional $250 billion should be added to the program but disagree on who should be allowed to receive the aid.