Apr 07, 2020 • 6 min read
As a partner in sports organization management, we are seeing clubs, leagues and communities crippled by the financial impacts of COVID-19. In an effort to keep you informed of the many small business relief programs available to sports organizations, I sat down with Jason Lynch, General Counsel for the Foundry Group, to answer some of your top questions.
Q: Jason, for many sports organization leaders, this is the first time they are facing economic impacts of this magnitude. What should they know about small business relief programs and whether or not they qualify for support?
A: There are two programs that could be helpful in offsetting lost revenue or unexpected expenses due to COVID-19. First, the federal Small Business Administration makes emergency disaster assistance loans to qualifying small businesses who experience economic hardship because of the crisis. Information about these loans is available from the SBA, which you can find here. This program includes $10,000 emergency grants which do not have to be repaid. Second, Congress recently passed the CARES Act, which contains the Paycheck Protection Program (PPP). The PPP will make loans to small businesses that can be used to cover payroll, rent, and utilities.
Q: There’s been a lot of discussion about the CARES Act. What should sports leagues and clubs know about it?
A: This law is gigantic, but intended to support small businesses in a number of ways. Sports organizations and any small business should focus on the following areas (I have included direct links for easy access):
Q: Can you share a bit more on the PPP loan program? We have already heard from many clubs who are struggling to keep coaches and staff on payroll during this time, so even a modest amount of relief could go a long way.
A: The basic terms of SBA 7(a)/PPP loans are as follows:
Q: What else might a 7(a) loan be used for? Can this also help in covering facility and equipment expenses sports organizations may have regardless of whether games and practices are occurring?
A: 7(a) loans can also be used for:
Q: Where can someone apply for a 7(a) loan?
A: The application is available from the SBA here. But you make your application directly through an SBA-approved lender. Contact your bank to see if they are one. A list of the most active SBA lenders is here. You can get assistance from local SBA offices by locating one near you here.
Q: As a small business owner yourself, is there anything else you might recommend for our customers?
A: My wife owns a small retail candy shop in our town. I understand how hard it is to own a small business when you’ve been told you have to close your doors for an uncertain amount of time. The SBA programs we’ve talked about here can help businesses weather this crisis. And one thing I’ve seen is the tremendous support that communities have for the small businesses they rely on. So stay strong, and we’ll all get through this together.
Quick Links to Additional Resources:
U.S. Small Business Administration – Coronavirus (COVID-19): Small Business Guidance & Loan Resources
U.S. Chamber of Commerce – Coronavirus Emergency Loan Small Business Checklist
The Hustle – The small business owner’s guide to the CARES Act
Disclaimer: This summary is prepared by Jason Lynch at Foundry Group for information purposes only. This is not legal advice. Please consult with your own attorney to receive legal advice about the specific circumstances of your business and how the CARES Act applies to you.