SBA Funding Opportunities for Charters

March 28, 2020

Access Large Grants and Loans
For Your School or Network

U.S. Government offering time-sensitive funding opportunities

School leaders, CMO leaders, and Board Chairs,

We wanted to follow up from our email last weekend about time-sensitive funding opportunities for nonprofits, including charter schools, through the federal Small Business Administration (SBA) and the CARES Act. In this difficult time, we want you to have access to as much funding support as possible. Both opportunities are “first come, first served,” so we recommend you act quickly.

The information below describes:

  1. How to apply immediately for the SBA Economic Injury Disaster Loan, including a $10,000 advance – this loan is open now;

  2. How to apply for the SBA 7(a) Paycheck Protection Program loan – lenders may begin processing applications for this loan on April 3; and

  3. The importance of ensuring your organization has a system to carefully track expenses and payments during this time.

Economic Injury Disaster Loans

Under the CARES Act, nonprofits can receive Economic Injury Disaster Loans (EIDLs) to assist with accounts payable, fixed debt, payroll, and other bills. EIDLs include an opportunity to receive a $10,000 advance within three business days of application. This $10,000 loan advance will not have to be repaid, essentially turning the $10,000 into a grant. 

These loans will be made on a first come, first served basis. Importantly, Congress has released new information clarifying that this grant is not limited to nonprofits of 500 or fewer employees; nonprofits of all sizes are eligible. 

General Loan Information:

How to Apply:

 

SBA Paycheck Protection Program Loans

Under the CARES Act, 501(c)3 nonprofits are eligible for Paycheck Protection Program loans (PPP loans) through SBA lenders. These loans are meant to help cover payroll, rent, mortgage, and utility costs. Up to eight weeks worth of these costs may be forgiven by the federal government, essentially turning the loan into a grant. PPP loans are open to nonprofits with 500 or fewer employees.

There is nothing in the CARES Act that disqualifies nonprofit charter school organizations from eligibility; so, unless there is official guidance from the SBA to the contrary, we recommend charter schools with 500 or fewer employees seriously consider this opportunity. Lenders may begin processing loan applications as soon as April 3, 2020. These loans will be made on a first come, first served basis; your charter organization should begin preparing to apply right now.

General Loan Information:

How to Prepare and Apply:

 

Tracking Expenses

Charter organizations may receive an EIDL advance of $10,000 and a PPP loan. However, the loans must be used for different purposes (e.g., supplies purchases covered by the EIDL, and payroll covered by the PPP loan). In addition, if a charter organization receives an EIDL advance of $10,000 and then a PPP loan, the $10,0000 EIDL advance will be subtracted from the calculation of the PPP loan forgiveness amount. Because of this, it is very important that your organization carefully track expenses and how those expenses are being paid during this time.

Next Steps

To take advantage of these opportunities, nonprofit charter organizations should take the following steps now:

  1. Apply for an Economic Injury Disaster Loan (EIDL) hererequest an emergency advance of $10,000.

  2. Take action now to be ready to apply for a Paycheck Protection Program (PPP) loan.

  3. Be on the lookout for continued updates from NSNO as we learn more.

  4. Make sure to check LAPCS’ COVID-19 Resources page for additional insights, tools, and ongoing updates.

  5. Please reach out to Jené Liggins, NSNO’s Director of Policy, at jene@nsno.org for any questions you may have.

Sincerely,

Patrick Dobard
CEO
New Schools for New Orleans

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