Area businesses, farms access federal aid in crisis
Although funds from two federal emergency small business assistance programs have been exhausted, some small businesses in North Dakota learned about them early enough to receive loans and stay afloat as they wait to reopen.
The Paycheck Protection Program, which the U.S. Small Business Administration describes on its website as “a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll,” approved more than $1.3 billion in loans to more than 72,000 North Dakota small businesses in early April.
The program is one of two outlined in the Coronavirus Aid, Relief and Economic Security, or CARES Act.
The money North Dakota received amounted to more than two times that of Alaska, a state with a similar population. South Dakota, which has a slightly larger population, received about $1.1 billion in loans from the program.
Rugby Job Development Authority Executive Director Liz Heisey said via email she was unsure about how many local businesses took advantage of the program.
“I talked to a few businesses and many were very hesitant to apply for assistance, a few said they would not,” Heisey said a few days before the program ran out of money.
“There is so much uncertainty on how long this will last,” Heisey added. “Banks are hesitant and so are businesses worried about taking on more debt. The SBA still has not come out with their final guidance on the CARES act so lots of uncertainty there also.”
A statement at treasury.gov described the PPP: “This program provides small businesses with funds to pay up to 8 weeks of payroll costs including benefits. Funds can also be used to pay interest on mortgages, rent, and utilities.”
The program accepted applications from small businesses, nonprofits and tribal businesses “described in the Small Business Act,” the website noted.
Funds were depleted in another aid program, called the Economic Injury Disaster Loan. The program included an advance of up to $10,000 to applicants.
Sen. John Hoeven also briefed North Dakota business and community representatives on assistance available to North Dakota small businesses and farms in a webinar forum last Friday.
Describing a new farm aid package, he said, “It’s going to be substantial, in excess of 16 billion for our producers. Essentially, the idea is it’s going to be for farmers and ranchers, too, who’ve been hit hard.”
The USDA announced the aid package called the Coronavirus Food Assistance Program last weekend.
The announcement said the program would “provide $16 billion in direct support based on actual losses for agricultural producers where prices and market supply chains have been impacted and will assist producers with additional adjustment and marketing costs resulting from lost demand and short-term oversupply for the 2020 marketing year caused by COVID-19.”
Another part of the program would purchase $3 billion in “fresh produce, dairy and meat” at a rate of $100 million per month from wholesale distributors impacted by the closures of restaurants. The program would package the food into boxes for distribution by local food banks.
The program would also purchase and distribute agricultural products to food banks and cover administrative costs.
The Rugby JDA also posted a link via social media to a new grant launched by the U.S. Chamber of Commerce on Monday.
The grant program, called, “Save Small Business,” offers $5,000 grants to businesses employing 3-20 people in economically vulnerable areas. Information for the program is available at savesmallbusiness.com.
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