As you read this, keep in mind that for the most part, the changes included in this legislation apply to all PPP loans except those already forgiven. In addition, the way the legislation is written, most provisions take effect immediately after the legislation is enacted, as if they were in the CARES Act that was passed March 27, 2020.
Please note this is based on our initial understanding of the new law. Treasury and the SBA will no doubt clarify certain provisions with guidance as they did multiple times with the first round of PPP.
Who is eligible for the new PPP 2.0 Loans?
Many small businesses and independent contractors may be eligible for the new PPP loans. You may qualify even qualify for a second loan if you received funds in the first round of PPP. New applicants are welcome as well as long as they qualify.
First, similar to the first rounds of PPP, eligible small businesses may include:
- Small businesses, nonprofit organizations, veterans organizations, Tribal business concerns, and small agricultural cooperatives that meet the SBA size standards.
- Sole proprietors, self employed individuals or independent contractors.
- Certain news organizations, destination marketing organizations, housing cooperatives, and 501(c)(6) nonprofits may now also be eligible.
In addition, this round of assistance is meant to target smaller businesses impacted by COVID-19. As a result, applicants who qualify generally must also meet the following criteria:
- The business may not have more than 300 employees and
- The business must have at least a 25% reduction in revenues in at least one quarter in 2020 when compared to previous quarters (more details below)
Also the business that got a first PPP loan must have used, or plan to use, their full PPP loan already received.
Certain types of businesses are not eligible including most businesses normally not eligible for SBA loans, businesses where the primary activity is lobbying, and businesses with at least 20% ownership by China. (Note the CARES Act did make an exception for certain non-profits and agricultural cooperatives, for example, which are not normally eligible for SBA 7(a) loans.) Publicly traded companies are not eligible to receive the new PPP loans.
ISI Statement and Resources Regarding COVID-19
ISI is carefully monitoring the evolving coronavirus (COVID-19) situation and taking necessary measures to help safeguard our skaters and families.
In communications to our member rinks last week, we provided a list of the latest EPA-approved disinfectants that have proved successful in fighting harder-to-kill pathogens such as norovirus and Ebola.
Please consult the experts in learning about prevention, preparation and protection. In addition to the well-published medical advice, we support the following recommendations to reduce the spread of the virus:
- Stay home if you are sick
- Wash hands frequently with soap and water
- Clean and disinfect frequently touched surfaces regularly
- Avoid handshakes and hugs
- Monitor the WHO and CDC websites for travel advisories and follow their recommendation
We encourage all members to be respectful of individual or individual organizational decisions regarding participation. We strongly recommend that you follow the advice and direction of your local health department and follow their guidance.
The following websites provide helpful resources on preventive measures and how to talk to your children about the situation:
We will continue to assess the coronavirus situation closely and make any necessary plans as it relates to our upcoming national competitions. Updates will be posted on our website. Thank you for your understanding and patience as we navigate this ever-changing health outbreak.
March 13, 2020
Resources for Administrative Members during the COVID-19 Pandemic
Stimulus Overview and Resource Information – Information courtesy of National Council of Youth Sports
SBA Disaster Loan Program – Economic Disaster Injury Loan (EDIL) – This program is in place. Borrower’s work directly with the SBA (not the banks) through their website https://disasterloan.sba.gov/
- Up to 30 year amortization
- Interest rates of 3.75% Fixed
- Personal guaranty
- Collateral if available
The Coronavirus Aid, Relief and Economic Security Act (CARES Act) includes a section for a new SBA loan program titled Paycheck Protection Program (PPP). PPP is administered through existing SBA Preferred Lenders. Although many of the guidelines are pending, below is a summary of key terms (as they stand today):
Paycheck Protection Program $349B Authorized through June 30th
- These are 7A Loans with a 100% guaranty to the Bank
- No Personal Guaranty
- No Guaranty Fee paid by Borrower
- Bank pays no servicing fee to SBA
- Use 7A Application Forms
Maximum Loan Amount & Terms
- 2.5 Times the Borrower’s average monthly payroll over the last 12 months (may exclude individual comp>$100k)
- Some adjustments to calculation for highly seasonal businesses and start ups
- Payment deferral for first 12 months
- Maximum term 10 Years
Interest Rates – Same as 7A
- P+2.75 for maturities greater than 7 Years
- P+2.25 for maturities less than 7 Years
Use of Proceeds
- Any 7A approved use of proceeds
- However only the amounts paid for the following are eligible for Debt Forgiveness
- Payroll (may exclude comp for individual over $100K)
- Mortgage Interest
- The total amount of proceeds used for Payroll, Rent, Mortgage Interest & Utilities paid in the 8 weeks after loan origination.
- Forgiveness amount is reduced based on number of FTE reduced, or reductions in comp for individual more than 25%, during that period
- No reduction in forgiveness for termination or pay cut prior to 4-1-20 if reversed before 6-30-20
- Borrower submits certified report to lender – lender reports online to SBA – payment is processed to lender within 5 days
- Must meet SBA definition of small business (generally under 500 employees but some variation by NAICS codes) Non-Profits are also eligible.
- Borrower must certify:
- These funds are necessary to maintain on-going operations
- Proceeds will be used to pay Payroll, Rent, Mortgage Interest, Utilities
- Intent to maintain certain number of FTE through June 30 based on the number used to determine maximum loan amount
- Cannot have both an SBA Disaster Loan (done after 3-31-20) and PPP Loan – must choose one or the other
Information courtesy of Texas Security Bank
Some suggestions on things you might be doing to minimize the effect on your company and employees:
- Review your insurance policies for Business Interruption riders/clauses. Speak with your agent regarding your coverage
- Consider applying for SBA Disaster Assistance Loan. Apply online at www.SBA.gov/disaster. These are low interest, long term repayment loans, with no payments for the first year, that can help businesses that have been affected by Coronavirus and the resulting economic actions. These loans are done directly with the SBA and not through the bank.
- We know that this will take a toll on your employees. We suggest that you go to www.DOL.gov/Coronavirus . The Department of Labor is working with state unemployment insurance programs to help pay benefits where:
- An employer temporarily ceases operations due to COVID-19 preventing employees from coming to work
- An individual is quarantined with the expectation of returning to work after the quarantine is over
- An individual leaves employment due to risk of exposure or infection or to care for a family member
- Additional resources for displaced employees can be found at www.careeronestop.com
Information courtesy of Texas Security Bank.
Resources for Professional Members during the COVID-19 Pandemic
Disaster Unemployment Assistance for Professional Coaches
As the coronavirus (COVID-19) pandemic continues to wreak havoc on our daily lives, we want to assure you that the well-being of our members is top of mind.
We realize that these are frightening and challenging times for you as a professional skating coach, and we are empathetic to your concerns.
If you are facing unemployment or a lapse in employment, the following resources may be available to you:
- Unemployment Insurance— Provides unemployment benefits to those who lose their job through no fault of their own.
- Disaster Unemployment Assistance— If you do not qualify for other types of unemployment benefits, you may qualify for Disaster Unemployment Assistance.
- Unemployment Assistance — Find employment benefits (filtered by state) near you.
Due to the expected influx of people filing for unemployment, we recommend applying for benefits as soon as possible.
Note: We strongly encourage you to apply with YOUR state government to see if you are eligible for unemployment benefits. The experts are encouraging those that are unemployed due to the corona virus to start at the state level. Make sure the website you visit to ends in “.gov”.
You may also have healthcare concerns, and the following resources should prove helpful:
- COBRA Continuation Coverage — COBRA Continuing Coverage may be the right choice if you are experiencing a lapse in employment.
- Medicare and Medicaid— These benefits may help people attain healthcare. Read the key differences between Medicare and Medicaid to find the best option for you and your family.
- Healthcare and Medical Assistance — Browse various healthcare programs.
For more information, visit Benefits.Gov.
- Disaster Assistance for Small Businesses — The U.S. Small Business Administration (SAB) plans to coordinate with states to provide targeted, low-interest loans to small businesses and nonprofit organizations severely impacted by the coronavirus under the Economic Injury Disaster Loan Program.
Message from our ISI Excecutive Committee
A Message from the ISI Executive Committee
Our nation is facing an unprecedented crisis, one that none of us have faced in our lifetimes. We hope and pray that you and your families are safe and healthy during this extremely trying time. We can only hope that this situation brings us together as a nation and as an industry.
As arena managers, owners and operators, we will continue to face many challenges in the coming days, weeks and months ahead. While some of us may have weathered the storm of September 11, the financial crisis of 2007-08, Superstorm Sandy (in the New York/New Jersey Metro Area), the California wildfires and/or other catastrophic events, none most likely will be comparable to what we are up against now.
The Covid-19 crisis will test us, our industry and our nation in ways we never imagined possible. We will only prevail by thinking ahead, working collectively and operating differently. So what can we do now to navigate this catastrophe and better prepare for impending obstacles?
Here are some suggestions:
Continue to communicate with your customers — Let them know that you are there and care. Communicate via email, social media and on your website.
Plan and communicate your refund and credit policy — As difficult as it may be for us as small business owners, things will be tougher for those who have lost or will lose their jobs and have no income. Many of us have had to cancel or postpone programs. Reassure your customers that they can still participate in a program down the road when the situation improves. Regularly communicate your plans to your customers.
Pay it forward — If you have had to cancel children’s birthday parties occurring in the days and months ahead, reach out to all of the children who will now be unable to celebrate with their friends at your rink. Call them on the phone and wish them a happy birthday or send them a small gift in the mail. Take this a step further and contact all of the children who had parties at your arena last year and wish them a happy birthday as well. These thoughtful actions will go a long way toward showing customers that you truly care.
Think ahead to when your arena will be open again — People will have concerns about being in groups and that facilities are clean. First impressions go a long way. Wegman’s super market in New Jersey has greeters at the door who hand customers gloves and disinfect their shopping carts. What can you do at your arena when you reopen (or if you are still open) to reassure customers that they are safe and that you have their best interests in mind? When your reopen, will you need to limit the number of people who skate, and do you need to plan for that?
If your arena is not under lockdown (shelter-in-place) — Find out if a small crew of workers can perform annual maintenance now instead of in the summer. You may be able to get great deals — and help support our vendors by buying netting, dasher boards, ice paint and rental skates now. Yes, this may be challenging with little or no revenue, but you may be able to secure low-interest loans from the government to buy many of these items
If your arena operates summer camps — How are you going to reassure customers that everyone is safe? Will you need to change program formats or how camps are operated?
Contact other rinks in your area — Work together to address challenges. Think of various ways you can help each other, such as sharing staff, maintenance projects and extra supplies.
Think out-of-the-box to maintain customers and engage employees — Can you have your staff instruct online classes for customers — workouts and dryland exercise programs for skaters and hockey players? Perhaps you can offer online education to your staff, such as ISI University, Microsoft Office and/or motivational classes? And how about working with your ice rental, learn-to-skate and other patrons to defer payments, host fundraisers or develop other creative ways to maintain them as customers.
These are going to be difficult times, but we will be stronger and better from this experience. We can mitigate some of the hurdles by thinking ahead, planning and addressing challenges together.
ISI is here for you, and we have many member resources to help you grow and manage your business better and more efficiently. There are numerous professionals on our board and in the ISI office who can help you with the operation of your arena and your business. We will get through this, with vision and a spirit of cooperation. No doubt, it will not be easy, but it can be done.
March 25, 2020