On March 27, the federal government enacted the $2.5 trillion Coronavirus Aid, Relief and Economic Security Act (CARES). OU Advocacy worked closely with congressional lawmakers to ensure that nonprofit institutions, including Jewish day schools and synagogues, would be eligible for assistance under CARES.
As a result of the advocacy we conducted – along with our partners in the Jewish community – nonprofits can receive assistance through the new federal "Paycheck Protection Program,” managed by the Small Business Administration (SBA), and employees of these institutions are eligible for expanded unemployment benefits.
The CARES Act allocated $350 billion in 100% federally guaranteed loans of 2.5 times monthly payroll costs, up to $10 million, so nonprofits and small businesses won't have to lay off employees.
What can the loans be used for?
The loans can be used for operational costs including:
- Payroll expenses
- Health benefits
- Paid, sick, medical/family leave and insurance premiums
- Mortgage interest
- Rent payments
- Interest on debt incurred before the covered period
And—significantly—employers that maintain employment between March 1 and June 30 would be eligible to have their loans forgiven, essentially turning the loan into a grant.
How can a school or shul apply for a loan?
The federal government has not yet released the specific guidance or application on the "SBA Paycheck Protection Program,” but will do so by April 11 (hopefully sooner). We will contact you as soon as this guidance and application is available.
In the meantime, you can prepare to apply for this loan (on behalf of your school or shul) by gathering the following information:
- A complete copy of the organization's most recent tax return OR a copy of the organization's IRS tax-exempt certification AND complete copies of the organization's three most recent years' "Statement of Activities”
- Schedule of Liabilities.
- Tax Information Authorization (IRS Form 4506-T), completed and signed for each applicant and for any affiliated entity. Affiliates include, but are not limited to, business parents, subsidiaries, and/or other businesses with common ownership or management.
If you already work with a bank or lender, contact them immediately to let them know you are interested in applying for this loan! Although the loan application has not yet been released, we expect the SBA to consider applicants on a "first come, first served” basis. If you are not already working with a bank or lender, consider using one of these resources (or one of the SBA-approved lenders on the OU's website):
If you already work with a bank or lender, contact them immediately to let them know you are interested in applying for this loan! Although the loan application has not yet been released, we expect the SBA to consider applicants on a "first come, first served" basis. If you are not already working with a bank or lender, use this link to find SBA-approved lenders in your state.
PAYROLL TAX PAYMENT DEFERRAL
Employers can and self-employed individuals can defer the employer share of their Social Security taxes until December 31, 2022.
EXPANDED UNEMPLOYMENT BENEFITS
Under CARES, the federal government has added $600 for four months to go to laid off employees in addition the amount of income the employee receives from their state.
- Employees of Jewish day schools and synagogues are eligible for this benefit
- Nonprofits will be provided "emergency unemployment relief,” through December 31, 2020, for half the costs they incur to pay unemployment benefits.
We are here to help your schools or shul as you work to secure payroll protection. Our daily email updates will provide the most up-to-date information available and we will be hosting webinars on a regular basis to offer suggestions and answer questions.
Click here to receive our regular updates
To RSVP for our conference calls and webinars, beginning with a call on March 31 at 2:15 p.m.,
please email email@example.com