State applies for federal program to provide loans to small businesses
Photo from The Ohio Channel
The state of Ohio has started the process of enlisting the U.S. Small Business Administration for monetary assistance amid the COVID-19 closures.
Gov. Mike DeWine and Lt. Gov. Jon Husted said they sent a letter and application on Tuesday to the SBA so the state can qualify for the Economic Injury Disaster Loan program.
Husted announced the state’s intention to apply during a press conference with DeWine in which they announced that restaurants and bars would be closed to dine-in traffic.
Through the program, small businesses and non-profits can apply for up to $2 million in low-interest loans to cover loss of revenue resulting from closures and slowed business due to the COVID-19 disease outbreak.
The loans come with a 3.75% interest rate “for small businesses without credit available elsewhere,” according to a release from the Governor’s office. Nonprofits will receive a 2.75% interest rate.
Businesses who can get credit elsewhere aren’t eligible for the loans.
Those receiving the disaster loans can use them for debts, payroll, accounts payable and other bills, the release stated.
“To keep payments affordable, these loans are long-term, with up to a maximum of 30 years for repayment,” the release stated. “Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.”
Both U.S. Senators from Ohio said they have asked SBA Administrator Jovita Carranza to “immediately approve” Ohio’s application, according to a joint release. Sen. Sherrod Brown and Sen. Rob Portman sent the administrator a letter Wednesday urging the SBA to send needed resources to the state.
“While Ohio’s small businesses and non-profits are resilient, it is critical we act quickly to ensure they have the necessary economic support to overcome the significant challenges created by this public health crisis,” Brown and Portman wrote in a letter to Carranza.
The Director of the Ohio Development Services Agency, Lydia Mihalik, said more than 1,500 businesses have reached out with their experiences amid the COVID-19 outbreak.
Businesses can go to sba.gov/disaster for more information on the loans.
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