Press release | Press releases | Writing

15.03.22

COVID EIDL loans were due to mature next month, but after Schumer’s request, citing Omicron surge and rising costs, SBA will defer COVID EIDL loans for an additional 6 months

The senator says an extended break will bring relief to every county in the state for More than 330,000 New York small businesses and nonprofits Who have a COVID EIDL loan

Schumer: Begin IMMEDIATELY SBA to provide additional relief to New York’s main streets to spur recovery

Following his direct advocacy for New York’s small businesses, U.S. Senate Majority Leader Charles E. Schumer announced today that the Small Business Administration (SBA) has answered his call and will defer payment of all COVID EIDL loans approved for an additional 6 months, for a total of 30 months principal and interest payment deferral since the start of the COVID EIDL loan. Schumer wrote to SBA Administrator Isabel Guzman last week asking for the extended pause, citing the latest Omicron wave and economic uncertainty from rising costs and global supply chain disruptions. Schumer said this additional relief will put small businesses and nonprofits in every county in New York and across the country in a better position to fully recover from the pandemic and give borrowers much-needed breathing room to recover. on foot.

“The EIDL program has been a lifeline for hundreds of thousands of small businesses and nonprofits in New York City, in every county across the state, and now more than 330,000 small businesses and organizations in nonprofits across the Empire State will receive much-needed additional aid to help them recover as they emerge from the Omicron wave,” said Senator Schumer. “This will allow our high streets to breathe a sigh of relief and ensure they don’t have to take another hit to their bottom line with further loan repayments amid supply disruptions. world and economic uncertainty. I thank SBA Administrator Guzman for heeding my call to extend the pause, putting our hardest-hit businesses in the best position to fully recover.

Schumer has broken down the distribution and economic impact of EIDL loans for New York regionally below:














Region

EIDL COVID Loans Approved

(one per small business or nonprofit)

Total Amount of COVID EIDL Loan Approval

Capital Region

8,755

$792,217,300

Hudson Valley

36,371

$4,046,002,794

Western New York

10,625

$975,613,302

Finger Lakes

9,489

$871,156,631

NYC Center

4,984

$470,995,400

South level

4,536

$410,217,900

Northern country

2,570

$222,986,924

Mohawk Valley

2,974

$255,896,850

Long Island

55,718

$6,149,007,952

new York

198,860

$20,284,719,202

Schumer explained that over 330,000 New York small businesses and nonprofits have received more than $34.5 billion in assistance under the EIDL program and nationwide, nearly four million borrowers will potentially be eligible for this extended pause.

A copy of Schumer’s original joint letter to Small Business Administration Administrator Isabel Guzman appears below:

Dear Administrator Guzman:

We are writing today in support of the nearly four million small business Economic Disaster Loan (EIDL) borrowers who continue to struggle due to the COVID pandemic and ask that you use your administrative authority to extend the period. deferment of the EIDL program to help small businesses across the country thrive as our economy continues to recover.

The EIDL program has provided a lifeline for a wide range of industries and business sectors. Although there are many encouraging signs that the economy is improving, most small businesses are not yet in a position to benefit from the recovery due to their reduced profit margins, tighter inventories, lack of access to capital and supply chain delays. Companies that have turned to the Small Business Administration (SBA) during the pandemic include some of our nation’s most vulnerable businesses. Giving them extra time before they have to repay their loans would not only provide them with much-needed relief during this time of continued uncertainty, rising costs and supply chain challenges, but would also put them in a much better place. position to prosper once the economy fully recovers.

Upon your confirmation last spring, we were encouraged by your immediate decision to extend the deferral period for the EIDL program from 12 to 24 months. This decisive use of your authority was an acknowledgment that the operating environment for small businesses remained perilous, due not only to the ongoing health threat, but also to the large-scale changes that had dramatically altered our economy during the pandemic. As you know, small businesses struggle to sustain their debts, even in the best of times. Your decision to extend the EIDL deferment period brought immediate relief and was warmly welcomed by businesses trying to pull themselves together after a year of struggling to survive.

Unfortunately, since your tenure at SBA began, additional variants of COVID-19 have forced businesses to face many challenges. The US Census Bureau reported that small businesses started in 2022 were not operating at full capacity, facing staff shortages and declining revenues. Over the past year, small businesses have faced tough decisions: do they invest their limited capital to prepare for customers who may not be able to walk through the door, or risk not being able to meet demand and suffer damage to their hard-earned reputation? ? Are they hiring workers to serve a customer base that may not materialize or are they accepting the possibility of being understaffed and overwhelmed? Are they proceeding in anticipation of a return to normal or are they constantly adapting their business model? No business can answer these questions with certainty today, yet they are inevitable, forcing small business owners to make critical decisions that will ultimately determine the viability of their businesses. These are also decisions that put enormous pressure on a small business’ balance sheet.

You have the power to reduce at least some of the uncertainty that businesses face when it comes to their EIDL loans. As you did last year, we encourage you to use the SBA’s statutory authority to provide additional leeway for small businesses whose loan payments will soon be due. As you know, small businesses are resilient and innovative. Knowing that debt service won’t be a short-term concern is invaluable. Extending the deferment period allows these small businesses to use their cash on hand for operating expenses, paying employees and making long-term planning decisions.

When Congress funded the COVID EIDL program in 2020, it did so to ensure that small businesses would have access to the capital they needed to weather this pandemic and ultimately emerge stronger. After two turbulent years, we know the end is in sight, and SBA should continue to provide small businesses with resources and relief. We ask that you recognize the ongoing uncertainty and hardship of small businesses and extend the EIDL COVID-19 deferment period.

Truly,

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