COVID-19 Update
The past two weeks have represented an unprecedented and rapidly evolving time in Michigan and around the world. This week, Governor Whitmer announced critical steps in efforts to “flatten the curve” of the COVID-19 outbreak here in Michigan by signing Executive Order 2020-21. Out of primary concern for the health and safety of all Michiganders, Executive Order 2020-21 orders the closure of all businesses to the extent its workers are necessary to sustain and protect life, effective at 12:01 a.m. on March 24, 2020 extending through at least April 13, 2020. The order also directs Michigan residents to stay home unless they are a part of that critical infrastructure workforce or an “essential” business.
In compliance with this order, the MEDC building will be closing onsite operations as of March 24 and all MEDC staff – with the exception of a few select employees performing essential functions – will be working remotely through April 13. During this time, the MEDC continues to be open for business and we remain as committed as ever to providing high levels of customer services while enabling economic opportunity for Michigan residents. We support Governor Whitmer’s decisive and necessary actions to limit the spread of COVID-19 throughout Michigan and stand ready to address or answer any questions or concerns you may have in the coming days and weeks.
How the Capital Access team can help
As small and medium-sized businesses across the state are negatively impacted by the COVID-19 outbreak, existing programs within Capital Access provide opportunities to access to financing that may not otherwise be available. Any business that has been affected by COVID-19 is eligible to receive support through the Collateral Support and Loan Participation programs. We encourage participating lenders across the state to work with their existing business customers to consider whether these programs could offer access to critical capital, with our team standing ready to help. Available programs include:
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Capital Access Program: The Capital Access Program (CAP), is available to assist businesses with capital needs. Similar to a loan loss reserve fund, the bank, the company and the MSF pay a small premium into a reserve that makes it possible for the company to receive fixed asset and working capital financing.
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Collateral Support Program: The Collateral Support Program works to provide cash collateral accounts to lending institutions to enhance the collateral coverage of borrowers. This program seeks to enable borrowers to acquire the necessary financing that may otherwise be unavailable due to a collateral shortfall.
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Loan Participation Program: The MEDC can participate with a lender for new financing that decreases the lender’s credit exposure. For projects with speculative cash flows, the MEDC may offer a grace period on repayments.
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New state and federal resources available for businesses
U.S. Small Business Administration statewide Economic Injury Disaster Loan
Small businesses around the state have a growing number of resources available to assist them in recovering from economic losses as a result of the COVID-19 virus. The most recent support came from the U.S. Small Business Administration statewide Economic Injury Disaster Loan (EIDL) declaration, requested earlier this week by Gov. Gretchen Whitmer, with the support of the MEDC and Michigan Small Business Development Center.
The EIDL designation means that Michigan small businesses, small agricultural cooperatives, and nonprofits that suffer substantial economic losses as a result of the COVID-19 outbreak will now have the ability to apply for low-interest loans as part of $1 billion in funding made available to the SBA by Congress earlier this month.
The application for disaster loan assistance is available at https://disasterloan.sba.gov/ela/. For businesses looking for more information on how to apply for an SBA EIDL loan or whether it is something they should consider, visit michiganbusiness.org/covid19.
Michigan Small Business Relief Program
The Michigan Strategic Fund recently authorized the funding of the Michigan Small Business Relief Program, which will provide up to $20 million in grants and loans to support businesses facing drastic reductions in cash flow and the continued support of their workforce.
The program authorizes the MEDC to provide up to $10 million in small business grants and $10 million in small business loans to support businesses facing drastic reductions in cash flow and the continued support of their workforce.
The MEDC anticipates that at least 1,100 businesses across the state will benefit from this program. The Michigan Small Business Relief Program will be a top priority for the MEDC, with funds being available no later than April 1, 2020.
Details on eligibility are available here, with additional information on how to apply coming soon.
Virtual procurement and donation platform connects health and human services organizations, local municipalities with suppliers of critical products and services
The MEDC launched a new free, statewide online procurement and donation platform through its Pure Michigan Business Connect program for buyers and suppliers of critical health and human services across a broad range of categories, including local municipalities, to minimize the impact of the virus in the state. The platform will allow health and human service providers across Michigan in need of critical supplies to connect with vetted Michigan businesses and municipalities able to provide or donate goods and services.
Buyers that could benefit from the virtual platform include childcare facilities, community centers, educational institutions, healthcare facilities, municipalities, food distribution centers, homeless shelters, non-profits and more. Items to supply could include medical devices, pharmaceuticals, cleaning supplies, testing supplies, textiles, paper products, vitamins, water and more.
Apply here
Additional Resources
Access additional resources by visiting michiganbusiness.org/covid19.
Visit Michigan.gov/coronavirus for valuable resources for employers and workers, to sign up for regular COVID-19 updates and to stay informed on the Governor’s latest efforts to mitigate the impact of the virus on our state’s residents and economy.
Information around this outbreak is changing rapidly. The latest information is available at https://www.michigan.gov/Coronavirus and https://www.cdc.gov/coronavirus.
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