COVID-19 Financing Options
Municipal, state and federal agencies are providing financing assistance to small businesses impacted by the COVID-19 pandemic. This page provides important information and connections with special government financing programs during the current emergency, as well as the regular financing options available through LVEDC and the Lehigh Valley Lending Network.
Lehigh County COVID-19 Relief Small Business Grant Program
Lehigh County allocated $5 million in federal CARES Act funding for a COVID-19 Relief Small Business Grant Program for companies or farms with 100 or fewer employees. The application period ended Aug. 14.
The Greater Lehigh Valley Chamber of Commerce administered the grant program on behalf of the county. Grant funding of up to $15,000 was available for payroll costs, rent and utility payments and other business expenses related to COVID-19.
Lehigh County CARES Act Tourism Grant Program
Lehigh County is using federal CARES Act funding to provide grants for tourism-related businesses in Lehigh Valley. The grant program is administered by Lehigh County in partnership with Discover Lehigh Valley. For-profit and non-profit tourism businesses of any size that have been negatively affected by the COVID-19 pandemic may apply.
Northampton County COVID-19 Relief Small Business Grant Program
Northampton County awarded $8.75 million in federal CARES Act funding to help businesses with fewer than 100 employees cover expenses related to the pandemic.
The Greater Lehigh Valley Chamber of Commerce administered the grant program on behalf of the county. Grants of up to $15,000 were awarded to 661 small businesses to cover payroll costs, costs related to continuation of group health care benefits, insurance premiums, mortgage or rent payments, utility bills, working capital to cover the costs of reopening businesses that were closed due to the pandemic, expenses related to meeting guidelines for reopening (specialized equipment, barriers, protective equipment, employee training, etc.), and any COVID-19 expense not already covered by other federal, state, or regional grant and loan programs.
Northampton County COVID-19 Small Business Emergency Relief Fund
Northampton County has established a $250,000 emergency relief fund for small businesses in the county with fewer than 100 employees that have been in operation for at least one fiscal year. The Rising Tide Community Loan Fund administers the program and processes applications. An application form is available on the Rising Tide website. Applicants can apply for a maximum amount of $15,000. Loans will have 0% interest over a 12-month term.
Pennsylvania COVID-19 Relief Statewide Small Business Assistance
The Pennsylvania Department of Community and Economic Development (DCED) allocated $225 million for grants of $5,000 to $50,000 to small businesses hurt by the COVID-19 pandemic. The program ended Aug. 28.
At least 50% of the grants went to Historically Disadvantaged businesses: those that are at least 51% owned and operated by people who are Black, Hispanic, Native American, Asian-American or Pacific Islander. Additional consideration was given to women-owned businesses, rural communities, and communities targeted for investment by state programs such as Main Street. DCED posted a factsheet with program information.
Pennsylvania COVID-19 Hazard Pay Grant
Pennsylvania’s COVID-19 Hazard Pay Grant Program used federal CARES Act funds to help employers provide hazard pay to employees who work in life-sustaining occupations so they can retain these key employees. The program ended July 31.
The state awarded $50 million in grants to 639 employers, supporting a $3 per hour pay increase for the 10-week period of Aug. 16 to Oct. 24 for more than 40,000 workers making less than $20 per hour in essential jobs. About two-thirds of the funding, $31.75 million, went to employers in the health care sector.
The complete list of companies that received Hazard Pay Grants can be found here.
Paycheck Protection Program Information
The federal Paycheck Protection Program (PPP) ended August 8. PPP provided an incentive for small businesses to keep employees on their payroll. A PPP fact sheet is available as well as a document that addresses frequently-asked questions. PPP loan recipients may request forgiveness if they meet employee retention criteria and funds are used for eligible expenses. The Loan Forgiveness Application Form is to be submitted to the lender that serviced the loan. Borrowers also may use an EZ Loan Forgiveness Application Form or a Simplified Loan Forgiveness Application Form for loans of $50,000 or less
The U.S. Small Business Administration (SBA) has published frequently asked questions about PPP loan forgiveness. The Paycheck Protection Program Flexibility Act of 2020 revised the deferral period for PPP loan repayments. Businesses that did not apply for loan forgiveness have 10 months from the PPP expiration date to begin making repayments. The SBA has issued guidance for changes in ownership among PPP loan recipients.
The SBA also established email addresses for questions about PPP loan forgiveness policies and the loan forgiveness platform. Send policy questions to [email protected]. Send technical questions about the loan forgiveness platform to [email protected]. The SBA’s toll-free PPP lenders’ hotline phone number is 833-572-0502.
Other SBA Relief Options
Economic Injury Disaster Loans (EIDL) for eligible small businesses provide up to $2 million to pay for fixed debts, payroll, accounts payable and other bills. The interest rate is 3.75% for small businesses and 2.75% for nonprofits for terms up to 30 years.
SBA Express Bridge Loans allow small businesses that have existing relationships with an SBA Express Lender to access up to $25,000 quickly to help overcome temporary loss of revenue, and to bridge the gap while applying for an EIDL loan. The bridge loan will be repaid in full or in part by proceeds from the EIDL loan.
SBA is providing Debt Relief to small businesses affected by the pandemic with existing SBA loans. The SBA will pay 6 months of principal, interest, and associated fees for 7(a), 504, and Microloans. Borrowers do not need to apply for relief, it will be automatically provided. Borrowers should contact their lenders with questions about payment relief. This is not available for PPP or EIDL loans.
For information about federal disaster loan assistance, visit here.
The Lehigh University Small Business Development Center (SBDC) can assist with the application process and provide additional information about SBA assistance programs.
Federal Reserve Main Street Lending Program
The Federal Reserve’s Main Street Lending Program is designed to help credit flow to small businesses that were in sound financial condition before the pandemic but now face cash flow interruptions. The program offers 5-year loans of $250,000 to $3,000,000 with floating rates and principal payments deferred for two years and interest payments deferred for one year.
The Federal Reserve Bank of Boston is registering interested lenders through the program portal. Businesses will apply for loans from participating lenders, who will determine eligibility and loan approval.
The Federal Reserve intends to purchase 95% of Main Street Lending Program loans to share the risk that otherwise would be absorbed solely by lenders, creating additional capacity for lenders to extend more loans.
Pennsylvania Industrial Development Authority (PIDA)
PIDA’s Small Business First Fund provided $61 million under the COVID-19 Working Capital Access Program for small businesses with 100 or fewer employees. Businesses were eligible for working capital loans of up to $100,000. The program ended March 31.
Access to the lowest-cost loans available
The Lehigh Valley Lending Network (LVLN) is an award-winning, nationally recognized unique partnership of local financial institutions with a goal to create efficiencies in accessing credit and other resources within the private commercial lending community. The Lending Network also provides the client with resources to maximize the use of incentives available through the economic development community and to connect borrowers to a lending network that provides business financing & commercial loans at fixed-rates in Lehigh Valley for machinery, equipment and more.
The LVLN provides a single point of access to allow business financing proposals to be broadcast to many commercial lending institutions simultaneously. Additionally, the financing programs that Lehigh Valley Economic Development Corporation (LVEDC) administers on behalf of the Lehigh Valley’s regional economic development organizations may be marshaled to assist in a given project.
The membership of the LVLN is comprised of private commercial lending institutions serving the Lehigh Valley.