What you need to know about EIDL grants

EIDL hands are the devil’s playthings…

As we thought would happen, the EIDL grants are being taken out of the forgiveness amount on the PPP forgiveness application, so if you got a $10,000 EIDL grant, expecting it to be completely free money (as was represented), it will be taken out of the PPP forgiveness amount.  For example, if you had an $80,000 PPP loan and submitted the entire amount for forgiveness, $10,000 is taken out and your lender is getting $70,000 back.  That means you now have a 1%, $10,000 loan with your lender.  Admittedly, that’s a great deal, but not what was promised.  Eliminating this is a key part of future legislation and I would expect it will be retroactive.

Speaking of legislation, the house wants to spend about $2.4 Trillion for a new stimulus program, the senate is down around $1.2 Trillion and the administration, through Treasury Secretary Steve Mnuchin, supports going to $1.8MM.  It’s like playing roulette:  what will it be and when will it be?  There should be some news this week.

The SBA continues to process forgiveness loans, slowly but surely, most of which are under $100,000 per a number of reports from banks.

While stimulus discussions are active, Congress is out (one could say “IEDL”), with the Senate coming back November 9 and the House on November 16, so we will see how and if they get anything done.

Economic reports that came out Friday are summarized as follows:

• Most major market groups posted decreases in September. The index for consumer goods fell 1.6 percent, led by declines of more than 4 percent for automotive products and consumer energy products. The production of business equipment fell 1.2 percent, as a decrease for information processing equipment was partly offset by an increase for transit equipment. The output of defense and space equipment rose 2.1 percent, while the indexes for construction supplies and materials were little changed.

Job claims also increased so from a practical perspective, Congress may see this as a reason to provide additional stimulus.

The money-center banks still do not have their PPP portals up and with the new 3508S form, that could be further delayed.

A Community Service Announcement

Cedar House, a chemical dependency non-profit based in Bloomington, would normally be having their annual Gala & Auction fund raiser.  However, it is now virtual and I would encourage you to go to https://e.givesmart.com/events/hBH/i/ to look at the items they have for auction or to even just donate.  The auction ends soon!!

Have a great week!