Nonprofits – like everyone else – are struggling to survive this COVID-19 pandemic. But the cavalry is on the way in the form of the Coronavirus Aid, Relief, and Economic Security Act, aka CARES Act. The act provides help to nonprofits struggling to meet their payrolls or pay their mortgage.
Here are four things you should know about how CARES can help your nonprofit.
More UI flexibility
The Emergency Unemployment Relief for Governmental Entities and Nonprofit Organizations section of CARES essentially lets states “interpret” their UI laws to be flexible for reimbursing employers. The federal treasury will pay states to reimburse employers for half the costs of the unemployment benefits they pay during the COVID-19 crises. This help applies to self-funded nonprofits, government agencies, and Indian tribes.
This is great news for self-insuring nonprofits that have been slammed by massive, virus-related layoffs that triggered huge reimbursement payments to state unemployment insurance trust funds. (Some states have decided to cover 100% of unemployment charges for reimbursers. Visit our COVID-19 FAQ for more details.)
Some nonprofits are eligible for Paycheck Protection Program loans
If you lead a 501(c)(3) organization with fewer than 500 employees, you can apply for a loan through the Small Business Administration to meet payrolls up to $10 million or 2.5 times your average monthly payroll. Happily, the loans may eventually be forgiven and become grants.
You could get a “Disaster Loan”
CARES includes Emergency Economic Injury Grants – “Disaster Loans,” a fast-action loan up to $10,000 from the SBA for nonprofits with fewer than 500 employees. The idea is that qualifying nonprofits won’t have to wait forever to get funds. Rather, funds for payroll, rent, mortgage, or other debt payment will be handed out within three days of accepting an application.
Big nonprofits can get help, too
The Treasury’s Economic Stabilization Act provides $500 billion to the U.S. Department of the Treasury to provide sources liquidity to help businesses and nonprofits stay solvent. This applies to organizations with between 500 and 10,000 employees.
About the Author
Lisa Kaplan Gordon is a veteran content producer, e-book creator, and social media writer with two Pulitzer Prize nominations and three National Headliners Awards. Her writing has appeared in Washingtonian Magazine, Redbook, Yahoo!, AOL Real Estate, AOL Daily Finance, USA Today, and US Weekly, as well as major metro dailies. She writes several times a month for 501c.com.