Carbondale offers loans for coronavirus-affected businesses
As businesses across the nation struggle to stay afloat during the coronavirus pandemic crisis, Carbondale has repurposed an existing loan program to help out.
The initial idea of the Carbondale Revolving Loan Fund was to provide startup or expanding businesses with a low-interest loan of up to $25,000.
Kula Yoga, Aloha Mountain Cyclery, restaurant Silo and other Carbondale businesses have benefitted from the loan program.
“Given what’s happened, we thought it might be of use to some of these existing businesses who kind of need a bridge funding while they’re kind of closed down or severely restricted in what they could do,” said Colin Laird, loan program coordinator and director of the Third Street Center.
The loan fund started in 2002 with a $50,000 grant from the Department of Agriculture and an equal amount from the town of Carbondale.
It was Carbondale Trustee Lani Kitching’s idea to ask the USDA for approval to offer the 3% interest loans interest free, and expand the program to those suffering from the measures intended to slow the spread of the coronavirus pandemic.
“With the economic uncertainty caused by COVID-19, I wondered if the Town’s revolving loan fund could be repurposed from being a start-up and expansion low-interest loan fund to a distressed business gap funding option,” Kitching said in a statement.
In the nearly 18 years since the program started, there have been no defaults and the fund has grown to about $130,000, Laird said.
The application turnaround can be shorter than some of the other business loans. Laird said that an approved business could see the loan return in four to six weeks.
Many Carbondale businesses have already inquired about the loan program.
“Hopefully it can be a useful tool in addition to the things that the state and the feds are doing,” Laird said.
Small businesses across the state are eligible for the Small Business Administration Economic Injury Disaster Loan program.
Applications for the new Payroll Protection Program opened Friday. The program provides potentially forgivable loans of amounts enough to cover 2-1/2 months of payroll or $10 million, whichever is less.
Congress allocated $349 billion to the program through the Coronavirus Aid, Relief, and Economic Security, or CARES Act.
The SBA accepted thousands of applications from around the country in the first day the program was available, according to tweets from the national administrator Jovita Carranza.
The payroll protection loans are currently available to small businesses and sole proprietorships. On April 10, the loan applications will open for independent contractors and self-employers.
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