Empire State Development Expands New York Forward Loan Fund to Include Paycheck Protection Program Beneficiaries

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Image courtesy of the Office of Governor Andrew M. Cuomo

Fri Sep 25, 2020 13:40 pm

Previously ineligible New York State small businesses can take advantage of low-interest working capital loans

Available for small businesses that have received PPP assistance of $ 50,000 or less

Empire State Development has announced that Paycheck Protection Program (PPP) beneficiaries are now eligible to receive low-interest loans from the New York Forward Loan Fund (NYFLF). This conditional change will provide greater flexibility to the fund’s network of lenders and financial institutions and allow them to provide more small businesses with working capital to cover expenses associated with the reopening.

Acting ESD Commissioner, Deputy President and CEO Eric Gertler said: “The coronavirus pandemic has been an unprecedented challenge for the state’s business community, 98% of which are small businesses. businesses – helping them reopen is essential to revitalizing our economy and making New York City better. “

A press release read: “When the NYFLF launched in May, the federal Small Business Administration had just published rules concerning the eligibility of businesses for federal aid. NYFLF’s goal was to help New York-based small businesses that did not receive PPP funding with flexible working capital reopen and adapt to post-COVID needs. Companies with 20 or fewer employees make up 90% of New York’s business community, and providing a financial lifeline to businesses excluded from federal aid was essential.

“However, some NYFLF applicants who needed assistance were deemed ineligible because they had already received P3 funds. Through discussions with lenders and applicants, it became evident that P3 loans did not go far enough to support New York-based small businesses. Legislative criteria limited how government assistance could be spent, and often P3 amounts were a fraction of what was needed and requested.

Now, NYFLF’s Community Development Financial Institutions (CDFIs) will contact previously ineligible applicants to determine if they are still interested in funding and begin the application process. This is limited to small businesses that have received $ 50,000 or less in P3 assistance.

The fund is ready to process new applications resulting from this change while also working with existing applicants. Small businesses that have not received federal assistance are still eligible and encouraged to apply. Additionally, the program target of providing at least 60% of loans to Minority and Women Owned Enterprises (MWBEs) remains, and this target will not change due to the newly expanded eligibility.

Qualifying small businesses and small homeowners can apply for a 60-month no-charge loan with a fixed interest rate of 3%; while qualifying nonprofits can apply for a 60 month no charge loan at 2% fixed interest. The maximum loan amount is $ 100,000. Loan funds can be used for working capital, including payroll, operational and emergency maintenance, property taxes, utilities, and costs associated with the development of physical space. to follow social distancing guidelines. More information is available online at nyloanfund.com.

The five CDFIs that process requests are Accion East, Community Preservation Corporation, National Development Council, Pursuit, and TruFund Financial Services. Seven banks have pledged to support the New York Forward Loan Fund: Apple Bank, BNB Bank, Evans Bank, HSBC, M&T Bank, Morgan Stanley and Wells Fargo. In addition, the fund has received philanthropic commitments from the BlackRock Charitable Fund, the Citi Foundation, the Ford Foundation and the Ralph C. Wilson, Jr. Foundation. The New York Forward Loan Fund was created with support from Calvert Impact Capital. The Local Initiatives Support Corp. (LISC) administers the fund and Connect2Capital hosts the applications.

ESD is New York’s premier economic development agency. For more information visit www.regionalcouncils.ny.gov and www.esd.ny.gov.

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