Last Friday, Congress passed and President Trump signed into law the $2.2 trillion Coronavirus Aid, Relief and Economic Security (CARES) Act. This bill, known as Phase 3, includes generous and unprecedented provisions to help provide liquidity for dealerships and to help businesses keep their employees on the payroll.
The bill contained the industry’s supported provisions which we have previously
, such as the new guaranteed loan program for small businesses and the extensive tax relief for individuals and businesses. One aspect of the bill is especially noteworthy for dealers in general, the new small business loan will be limited to businesses with 500 or fewer employees. However, as explained in the memo,
, the bill includes a provision that will enable certain franchised dealers to qualify for a waiver of the affiliation rules that typically apply for SBA loans.
NADA has been working with the U.S. Chamber of Commerce on reviewing the business-critical elements of the CARES Act, which allocated $350 billion to help small businesses keep workers employed amid the pandemic and economic downturn.
Known as the Paycheck Protection Program (PPP), the initiative provides 100% federally guaranteed loans to small businesses, which may be forgiven if borrowers maintain their payrolls during the crisis or restore their payrolls afterward.
The Chamber has issued a guide,
Coronavirus Emergency Loans: Small Business Guide and Checklist
, to help small businesses and self-employed individuals prepare to file for a loan. The guide covers issues related to eligibility, application criteria, borrowing amounts and forgiveness. It is an important resource for dealers to review as we await more details from the Administration on the program, including the list of lenders that will be offering loans under the Paycheck Protection Program.
on the Paycheck Protection Program has been released by the U.S. Senate Committee on Small Business and Entrepreneurship.