Overview: Coronavirus Aid, Relief and Economic Security Act

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), signed into law on March 27, provides potential relief for many small businesses under a payroll protection program.

This program includes access to new small business loans and loan forgiveness. While each business-owner should review the new law with his or her legal and financial advisors, below is a brief FAQ based upon the Pool & Hot Tub Alliance's initial reading.

Q. What sized business qualifies for a loan under this bill?
A. Companies with fewer than 500 employees.

Q. How much money can a company borrow?
A. The maximum loan amount is determined by taking your average monthly payroll costs over the last 12 months and multiplying it by 2.5. The maximum loan amount is $10 million.

Q. What is included in payroll costs?
A. Salaries (up to $100K per year), employee benefits, payroll taxes, payments for retirement benefits, severance, vacation, sick and family leave pay, and payments to independent contractors and self-employment income, up to $100K per year.

Q. How much of the loan can be forgiven?
A. Forgiveness is the amount spent during the 8 weeks following the loan origination on:

• Payroll costs
• Rent
• Interest payments on mortgages
• Utility payments

Q. Is collateral required?
A. No.

Q. Must I first use up any existing available credit lines?
A. No.

Q. Where do I go to apply for a loan?
A. To any participating bank.

Q. When will loans be available?
A. Unknown. Regulations and forms are being prepared and banks are getting prepared.

Read the full copy of the bill.

For more information please read the additional FAQs from the U.S. Senate.