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Questions & Answers from NPW's April 3rd Webinar: The Federal Stimulus and Westchester's Nonprofit Sector


www.npwestchester.org

Jan Fisher: jfisher@npwestchester.org, (914) 332-6679 (o) (914) 439-0203 (c)

The Federal Stimulus and Westchester’s Nonprofit Sector
Questions and Answers from NPW’s April 3rd Webinar


To make these answers most understandable and for the purposes of efficiency, we have grouped some questions together and provided key resources. If your question has not been answered, we may be still researching it.

You will find in this document:

        I.            Disclaimers
      II.            Key Resources
    III.            Questions and Answers
    I. DISCLAIMERS
    • The answers provided are based on our understanding at the time provided.  This presentation is not and should not be construed as legal advice nor does this presentation create an attorney-client relationship between you, your organization, the presenter or the Pro Bono Partnership. The content of this presentation is for informational purposes only. If you have specific questions about the practices of your organization, you should contact an attorney for advice.

          As situations are changing rapidly, the material presented in its entirety is our best understanding at the time of the presentation.

          The materials and presentation are not intended to offer legal or financial advice.

    II.                  KEY RESOURCES

      Please see:  NPW Webinar: The Federal Stimulus and Westchester's Nonprofit Sector Presentation DOwnload

      Chart Combining All Current Laws: Click HERE.

      Fiscal Management Associates Toolbox: Click HERE.
      Included in this is: 

      ·         Fillable PPP Application

      ·         FMA PPP Calculator This calculator will help you estimate the average monthly payroll and loan amount for your application.

      ·         FMA Template for Board Resolution Authorizing Loan — This template will allow you to quickly get approval from your board to apply for a PPP loan.

      ·         FMA Script for talking to a Bank about PPP — This script provides you with key questions you can use to call a bank immediately.

      Paycheck Protection Program

      Economic Injury Disaster Loans

      • https://www.sba.gov/disaster-assistance/coronavirus-covid-19#section-header-1
      • Apply HERE  
      • Advances: Economic Injury Disaster Advance Loan: In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000. This advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue. Funds will be made available within three days of a successful application. This loan advance will not have to be repaid.  Apply for the Loan Advance HERE.
      III.                QUESTIONS AND ANSWERS


        Would you share the spread sheet referenced in the webinar?  

        Click HERE for Excel Document with Instructions, PPP Loan Calculator and Calculating Payroll Costs

        Is the PPP application made to SBA or the Lender Bank?

        Lender Bank

        Most banks are starting by only accepting PPP applications from clients. Should most organizations start with their own bank?

        Yes.  If they are not a lender, they should be able to direct you appropriately.

        Is there a listing of which banks are accepting applications? 

        For SBA Map Click HERE (most extensive resource)

        Download HERE (SBA Document)

        You can apply through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program. You should consult with your local lender as to whether it is participating.

        Is there a statute of limitations/a date we can apply and get retroactive funding if we do not apply this month?

        While the program is open until June 30, 2020, the government is advising borrowers to apply as soon as possible given the loan cap on the program.

        Are there collateral/security requirements for PPP or EIDL?

        No. 

        What is included in payroll costs?

        Payroll costs for businesses include salaries, wages, cash tips, payments for vacation, parental, family, medical, or sick leave, and group health care benefits, as well as certain other employment-related expenses.

        The average payroll will be calculated over (i) 12 months prior to the loan origination, (ii) for seasonal employers, the period between February 15, 2019 through June 30, 2019 or, at the election of the borrower, March 1, 2019 through June 30, 2019, or (iii) the period between January 1, 2020 and February 29, 2020 for businesses not in operation during the period between February 15, 2019 and June 30, 2019

        Can an organization apply for both the PPP and EIDL?

        Yes; not for the same expenses

        Are there any PPP programs for 501c3 organizations with more than 500 employees?

        There is no specific information on this other than the National Council of Nonprofits:

        Opportunities for nonprofit for 500 to 10,00 Employees: Largely / loan program to be created by the Treasury Department to fill the gap between the Paycheck Protection Program for smaller employers and the industry stabilization loans to big business. Click HERE.

        Moving forward, NPW will work with our member organizations and State and National umbrella organization to advocate for stimulus funding nonprofits with more than 500 employees.

        How do you determine what amount can be used for rent?

        Rent, under lease agreements in force before February 15, 2020

        What is the meaning of the 6/30 date?   Is it the date by which the application must be made?  Is it the date by which expenses must be incurred to be considered for forgiveness?

        Applications must be made by that time.

        Are loans interest free for the first year?  

        No. 

        What to include or exclude in monthly payroll calculations

        See U.S. Chamber of Commerce Guide and Check List or Empire State Development FAQ.

        Are payments to independent contractor included in the annual payroll calculation?

        Yes. The 500-employee threshold includes all employees: full-time, part-time, and any other status.

        Are part-time employees included in the payroll calculations for the PPP?

        Yes

        Forgiveness

        ·         Up to 100% if you keep or increase your FTEs, maintain salaries of employees and spend the loan on what it is supposed to be spent for (payroll, rent, mortgage interest, utilities)

        ·         If you have to decrease salaries of employees making less than $100,000 by more than 25% or reduce FTEs, you will get a reduction (but not 100%) in forgiveness.

        ·         The loan for any unforgiven amount will be a 2-year loan at 1% interest.

        Religious Institutions

        See SBA Faith Based FAQ Final HERE.

        How do non-public schools, dependent on tuition from public schools, determine what loans they should apply for?

        Follow the SBA guidelines

        For nonprofits, are they looking for board members to be listed as owners?

        No; there are no owners for nonprofit organizations.

        Can an organization apply for both the PPP and EIDL?

        Yes; not for the same expenses

        For EIDL - does the loan review look at the cash you have on hand to determine if you qualify?

        No. But please see Small Business Guide and Checklist

        The portal for emergency EIDL loan requires completion of application for EIDL loan itself.   I already applied for EIDL under old forms.  Will completion of new EIDL form -- effectively submitting a duplicate application -- cause a problem with original application?

        To the best of our understanding all old forms/applications will be moved to the new portal.  If you did not check the box for the Emergency EIDL $10,000 loan, you will not receive it.

        On March 30 I applied for the COVID-19 Economic Injury Disaster Loan (OMB Control #3247-0406).   (We did not check the box that would give us an emergency $10,000 grant within 3 days.)  Is the Paycheck Protection Program Application (OMB Control # 3245-0407) part of the same program? 

        The Economic Injury Disaster Loan and Paycheck Protection Loan are two different loans, with two different application processes.  Both are part of the Federal Government’s Coronavirus Aid, Relief, and Economic Security (CARES) Act.  Economic Injury Disaster Loans (EIDLs) (SBA 7(b) Loans). Paycheck Protection Program (PPP) Overview (SBA 7(a) Loans)

        Is there a way to know how we easily qualify for loans?

        Please read the resources provided.

        For the EIDL, we suggest starting the application

        For the PPL, we recommend contacting your bank

        Do you know what is required to prove last year's payroll?  

        • Every bank will be different, but should be payroll processor records, payroll tax returns, and any other worksheets necessary to prove the payroll amounts.

        Does the $100,000 limit include health insurance premium and payroll taxes?

        • Our position and that of Fiscal Management Associates is no.  

        Should we use gross pay or net pay (after tax) when we calculate the loan amount? (I believe you said gross)?

        Our position is gross pay.  

        Is 990 be required for PPP loan?

        The best answer we can provide is - if the bank requests it.  We have also heard the answer is yes but remain uncertain. 

        Are there any programs for 501c6 not for profits?

        Emergency Injury Disaster Loan

        Colleges keep asking if they need to include student workers in the 500 employees.  If so, many of them exceed 500 employees?

        If they pay them on a W-2, our position is yes. 

        If a person is furloughed on March 20th, can they ask for EPLS during the furlough period?

        No, the law went into effect on April 1.

        How is the number 50 equated for a business?  Is it the number of people that were on payroll in 2019? 

        Please see the department of labor’s webpage and they detailed information on how to calculates employee count. The law goes into effect on April 2- a Thursday.  For employers whose pay period begins on the 4th or 5th can they start implementing the law with the new pay period? The law goes into effect on April 1.
        No, you cannot implement the law when your pay period starts.

        If a person is furloughed on March 20th, can they ask for Emergency FMLA during the furlough period: 
        No

        What about part time hourly employees, and what about partial leave - employee wants to reduce hours but still work some of her hours. 

        You can reduce an employee’s hours. They would be able to use sick leave if they qualify for it, on a prorated basis. If hours are reduced and then someone needs sick leave, then they would not be able to use sick leave to cover the hours that were reduced. See Question 28 https://www.dol.gov/agencies/whd/pandemic/ffcra-questions

        Can the NY paid COVID i sick leave and the Federal COVID sick leave run concurrently?

        Yes. The NY laws are not in addition to the federal benefits. NY law will supplement the benefits offered by the federal government, up to difference between the benefits available under New York’s law and the smaller benefits available under the federal law. 

        Do Independent contractors have to have paid into the system to receive unemployment payments? 

        We not sure, but it does not seem that they would.

        Can you create a flow chart combining all of the current laws? 

        We are unable to provide a flowchart. Please see the
        Chart Combining All Current Laws: Click HERE.

        How will expanded Unemployment impact nonprofits that are on a pay as you go basis for unemployment? 

        For those nonprofits who “pay as you go” the government will provide some assistance, but the nonprofit will also be required to pay some of the premiums. I suggest that anyone who is in this position, review the state unemployment website that is included in the slides.

        The FCCRA states employers must provide 80 hours of emergency sick leave to full time employees. Our work week is 35 hours for FT staff, so would we provide 70 hours of sick time or are we still required to provide the 80 hours? 

        Employees who work 40 or more hours per week are eligible for 80 hours. If someone works less than that, then the sick time is prorated. You can find the way to calculate part time hours, on the Department of Labor’s website.

        Does Pandemic cover business shutting down because of no work - we offer onsite after school programs?

        Sorry NYS pandemic unemployment insurance offering additional payments? Still not exactly sure that I understand this question, but if you are asking if someone can receive unemployment if there is no work available for this person. Yes, someone who is unable to work because of a business shut down, would be eligible for unemployment.

        Will there be extensions to use FSA $

        We have not heard of any additional extension on timing for FSA funds however there were a few exceptions made for use of funds. Those are: over the counter drugs can now be purchased without prescription and changes to elections are being allowed. I recommend that they reach out to their administrator of the funds for full details. The administration has made comments that there will be more money.


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