Senators Introduce Bill Seeking to Improve Economic Injury Disaster Loan Program

Because ANCOR members have turned to a range of loans to sustain their operations during the COVID-19 pandemic, we are sharing this update from ASAE on the Economic Injury Disaster Loan (EIDL) program. ANCOR is a member of ASAE, which is the association for association professionals.

“On July 2, Senators Brian Schatz (D- Hawaii) and Catherine Cortez-Masto (D-Nev.) introduced the Small Business Disaster Loan Enhancement Act of 2020 to boost funding and lower interest rates for the Small Business Administration’s [SBA] Economic Injury Disaster Loan (EIDL) program.

Unlike the Paycheck Protection Program (PPP), most nonprofit organizations are eligible for relief through the EIDL program, which also allows for more flexibility and can be used to cover a wide range of costs relative to the PPP. Specifically, this bill calls for the following:

• Lower interest rates to one percent, in line with the PPP loan rate;
• Allow new EIDL loan applicants to receive up to $2 million, based on their financial need; [ANCOR note: see this article on previous efforts by the SBA to restrict the loan size for additional context.]
• Enable current EIDL loan recipients to request an increase in their EIDL loan up to $2 million, based on their financial need;
• Require the SBA to provide the full amount of the EIDL advance requested by an applicant, up to $10,000;
• Create a new EIDL advance of up to $25,000 for applicants that have experienced a reduction of 50 percent or more in gross receipts from a comparable 8-week period before the public health crisis began; and
• Provide an additional $80 billion for EIDL loans and $20 billion for EIDL advances.”