How To Sign Connecticut Banking Forbearance Agreement

How to industry sign banking connecticut forbearance agreement

all right well in the interest of time I do want to welcome everyone my name is Megan Gilbert I'm the vice chair of the Chamber of Commerce of Eastern Connecticut we are really pleased have Sussman Shapiro and lets you gotten banks operating today as I've been pressing all of our webinars please bear with us as we bear with the state and federal government who are sending as much information as they can as quickly and some of which conflicts some of it which is supportive so we'll do our best to get as much information that is accurate right now to you as our attendees and our members for those who don't know the chamber has a very robust covin and Resource Center I apologize if you can hear the rain on my skylight it's loud here I hope it's not too loud for you but we do have a very robust website for the Cova 19 business resources and its chamber ECT dot-com and click the big red banner at the top or the red button in the middle of the page and it will take you there it's chamber ECT comm so for our staff we are working remotely as soon as we can to give you a little bit of a flight plan today we're gonna start with Christi Kelly who's gonna discuss general stuff about the cares Act and the rotavirus response Act Kaiser will be doing some slides dual relief and things that may have to do with the Department of Labor that that kind of situation Gary ball will do the business relief and the introduction to the Paycheck protection program and Tony Joyce from Joseon bank will join us at that point to go over that so that's sort of what to expect can I just ask if there's any press on the line can you just identify yourself in the chat or raise your hand depending what format you're using just so we know who's here listening and covering I would appreciate that at any point to ask questions during the program you can use the Q&A feature and everybody will be able to see the questions that are being asked you can upvote you can comment and in there but with that I will pass it to Christie Kelly from Cessna Shapiro - take it away Christie Thank You Megan and welcome today we're gonna discuss the what we consider to be the top five things you should know about the current Paris aid relief and Economic Security Act more commonly known as the cares Act let me just make sure I can get my slides to work okay just to start out you know there are three practitioners on the line and we want to make sure that we let you know that this is for general information purposes only and if you know situations arise that you have specific questions related to certain situations within your business or related to you personally we ask that you do not take this as any sort of legal representation or legal advice and we ask that you contact us directly to talk about specific situations you might have the as Megan said these are the speakers we thought it would be helpful if you had a face to put with the name and I am I'm Christie Kelly I'm a labor and employment attorney with Sussman Shapiro I've been practicing in this area for for many years now and we want to make sure that you know who's speaking we have Ted Heiser who's also a Labor and Employment practitioner from my office and Raymond Perabo who is a business law commercial law efficient ER very knowledgeable about all things business-related and of course Tony Joyce from Chelsea grin as Megan said if you would click the Q&A button on your screen to submit questions we are going to try to break with the the general content around 12:45 to answer questions I know that I have a little bit of leeway on time I'm not sure if anybody else does but if we are unable to answer your questions that you submit within the time allotted we'll do our best to to get answers and to get those posed or respond to you with those so what is the cares act the cares Act is a federal law it's not a state law it's a federal law that was enacted on March 27th 2020 and it was considered to be the second I'm sorry the third phase of federal relief that we are expecting in this COBIT 19 pandemic the the second phase of that was the family's first coronavirus response act and that was enacted on march 18th but so so we are we've received three phases of federal relief and the cares Act was was voluminous the five key highlights that we think that you are likely interested in and should know about the cares Act is it is in 880 page legislation but it's more than just omnibus appropriations meaning it's more than just appropriations of funds there were there were actual substantive provisions in the law that affect the way business and individuals are going to operate going forward so we wanted to provide some clarification of the FF CRA which came out of the cares Act there was also a good portion of the cares Act that addressed individual relief and an economic stimulus for individuals enhanced unemployment benefits and of course the payroll protection program for which is relief for small businesses and those are the five highlights that we'd like to cover today so most most Americans know the cares act as being the the economic stimulus law if we if I know in common conversation if I say oh that well that's the cares Act people don't necessarily understand what law I'm referring to but if I say oh it's the economic stimulus law people are well well of that because it is well known and was well publicized in the media as as being an individual economic stimulus that's going to send checks to all Americans but in in reality that cares act was a 2.2 trillion dollar appropriations law that is important to individuals and businesses in Connecticut as well as across the United States because it actually allocates four hundred and fifty four billion dollars in federal financial assistance that supports many of the members of the chamber of commerce businesses states and municipalities you may be wondering though well what does what does this law really mean to me and for individuals that could mean that that you will be receiving at some point a check a dot of federal funded check in the mail free money to assist with the loss of income that you might be experiencing it also means if you finding yourselves with reduced work or out of work there are modified and enhanced unemployment compensation benefits which Ted will talk about a little bit later and there were some modifications to the amount of loans that individuals can take from their from their retirement please are qualified they're qualified plans that they have with their employers which could help find individuals financially if they're if they need to access cash that they have stocked away in those plans and of course the the cares Act addresses certain provisions in the FF CRA which provided paid sick leave and expanded paid FMLA to individuals that wouldn't normally be entitled to it for for certain purposes it also means for those of you who are who are interested and who have the small businesses that the cares Act expanded certain emergency economic injury disaster loans ie DLS and provided some some enhanced provisions that you can access for those and the payroll protection loans that seems to be the hot the hot topic that that will help is intended to help small businesses keep their employees employed or encourages businesses to rehire employees that they had to temporarily furlough or laid off and of course it provides for some payroll tax credits which are intended to be instant financial relief so what else does the cares Act do as I said it clarifies the FF CRA and for many people the FF CRA is actually a topic that could could be a subject of a webinar entirely on its own it's a very very detailed law but what it does it went into effect on April 1st of 2020 so just last week we're one week in it provides employees with ten days of paid sick leave for qualifying reasons related to kovat 19 and the law itself provides six different categories six different reasons why somebody might be entitled to the paid sick leave and while we're trying to focus generally on the cares Act and not on the FF CRA today I can tell you that some of the some of the highlights of that act are that it provides for ten days of paid leave there's caps on the amount of pay that somebody is entitled to under that act it also surprisingly it only applies to employees who are still working so if you are an employee or you're an employer who had to layoff employees and April first came and went and and you have employees that that you know might otherwise have qualified for the paid sick leave if they're not working then then they are not entitled to that leave it really does only apply to employees who are still working one of the other kind of highlights of the paid sick leave act that employers are generally may not be aware of is that it doesn't matter how long an employee worked for an employer for them to be entitled to the paid sick leave and it applies immediately to new hires so if employers are hiring right now because they need the extra help for whatever reason at this point in time they they those new employees are entitled to that paid sick leave should they fall into one of those categories for the further leave and the paid sick leave applies to all employers public or private who have at least one employee but fewer than 500 employees and so this law really is aimed at small and mid-sized businesses the FF CRA explains the federal FMLA to allow up to 12 weeks of FML for employees who cannot work due to the need to care for a child as a result of COBIT related school or daycare closures and this this is this is unique because the existing Family Medical Leave Act well it apply it allows for 12 weeks of FML it only applies at least prior to the FF CRA to situations in which somebody has a serious medical condition or is required to care for somebody a family member who has a serious medical condition so this is a vast expansion for a limited amount of time I'll be it but it's a vast expansion of these leave protected leave rights that for a situation that does not necessarily involve anybody who is sick or has a medical condition and the the highlights of that law are that the first two weeks are unpaid the first two of the twelve weeks are unpaid however I note my little comment there the PSL applies during those first two weeks there's also a provision in the paid sick leave Act that entitles somebody to two weeks of paid sick leave so for those first two weeks if they qualify for the e FMLA they're going to have a right to paid sick leave under the paid sick leave Act for those two weeks so there you go now now those two weeks are automatically covered employees must be employed at least 30 days prior to the leave and that's a vast expansion of the FMLA and it only applies to this particular reason for FML but that's a vast expansion given that normally they have to have worked 1,250 hours prior to be being eligible for such leave the employee must certify that no other suitable individual is available to care for that for the child so if if if you have if your home if the employee is home and the employees spouse or adult child is also home it may be difficult for for the person to be able to certify that there simply is no other person available to care for that child and then importantly in the more recent most recent DOL regulations that were released last week a child is defined the same way as it is in the existing FML which means it's any child under 18 or under the age of 18 or an adult child who is unable to care for themselves normally and so the the the definition of child was expanded by the DOL regulations notably employers get a hundred percent reimbursement of costs that they extend for such leave dollar-for-dollar it's it's taken as an instant credit against payroll taxes and the cost of leave includes wages the cost of the leave that some that the employer can recoup is the cost of the wages and the employers cost for health insurance and what the cares act how the care is acting your intersects with the FF CRA is that employer it clarifies that employers can choose but they're not required to but it sort of encourages employers to choose to exceed the set monetary caps for paid sick leave and pay to FML notably and I didn't mention this above but that's the other part of the of the expanded FML that that is unique in that it not only it not only enables individuals to take up to 12 weeks of leave it calls for 12 weeks of paid leave and group granted it's at a reduced rate it's a bit of the normal pay that somebody would receive but it is it is actually a paid leave so that is a cost to employers that they wouldn't normally have to expend under a typical FML situation for more information because the the information on the FF CRA is so vast for more information i've included Susman Shapiro's link to our Cobie 19 Information Center which has summaries and FA cues on specifically on the FF CRA it's going to be updated I can tell you on this very topic it will be updated in the next couple of days because of the guidance that's been received by the Department of Labor and and so so we will be updating that as we do with each topic that we post about and that brings us to individual relief good afternoon everyone they're with me for one second I have had some technical difficulties this morning that no one else has so my apologies so my name is Ted Heiser I am a director at Sussman Shapiro and primarily work in the employment litigation world I get to talk to you about the actual individual relief in the cares Act as opposed to the business relief that Rhea Antonio will be speaking about as we look to the question of unemployment compensation there's a very important factor that you guys need to know about and that is that the state of Connecticut as of today has not adopted the unemployment benefits that are recommended by the cares Act the state of Connecticut Department of Labor website indicates that they are presently waiting on additional guidance from the United States Department of Labor and that it appears that they plan to adopt the cares Act provisions with respect to unemployment compensation but they have not done that as of yet the other thing to to keep in mind at least in dealing with your own employees is that this state of Connecticut Department of Labor has basically said to anyone inquiring if you have a question about whether you qualify for unemployment at this time and there are a lot of open questions that those individuals should just apply and The Situation's are going to be dealt with on a case-by-case basis whether that individual qualifies or doesn't qualify so so let's talk about the individual are the actual specific provisions within the cares Act related to unemployment so the Act has expanded the normal realm of who's qualified for for unemployment so that most importantly to a lot of small business owners particularly those who are self-employed the cares Act is does apply to self-employed individuals independent workers and gig workers it also applies to people who have already exhausted their existing state and federal unemployment benefits from already being unemployed how that's going to apply is a little bit in question I got a call from a former client who has been on unemployment she's been unable to find a job specifically because of the coronavirus and she asked me whether she would qualify for for the new benefits and I told her that my reading of the statute was that she probably would but that what she should do right now is to just file for those benefits and see what happens the Connecticut Department of Labor has basically been giving the exact same advice if you call and there's a question they will tell you file your your claim and we'll see what happens one other thing to know about the benefits is that the Department of Labor is completely and totally overwhelmed at this point as you all know there have been millions of new unemployment applications or benefits applications across the country and same holds true for Connecticut the Department of Labor is running almost three weeks behind in processing those those applications as they were dealing with applications I believe from March 21st so what's that about 18 days ago in terms of and Christy if you could you just go to the next slide thank you so the actual provisions that the cares act are offering is an extension of unemployment benefits up to 39 weeks that includes both new benefits so that if someone just lost their job as a result of the coronavirus or frankly for any reason at this point in time they will assuming the state adopts the provisions be entitled to 39 weeks of benefits normally oh and that would also apply to those who were already receiving benefits for who's existing state or federal benefits that run out they would get up to 39 weeks in Connecticut under normal circumstances terminated employees are entitled to 26 weeks of unemployment compensation this would obviously add an additional 13 weeks to that the two provisions are not cumulative if the cares Act brings the total to 39 weeks in total all people who are unemployed as of or because of the present situation are going to be entitled to a $600 per week supplement so their unemployment now the Connecticut is not presently processing these and it is a little up in the air as to exactly how this provision is going to work but the $600 is federally funded which means there is no reason why even if the state chose not to adopt the other provisions of the cares Act that applied to unemployment that they wouldn't still qualify for this additional supplement of $600 the other important part of the $600 or the thing to note about the $600 is that it is not income for the most part unemployment benefits are taxed as income there are some limitations on that but for the most part or at least generally they are for purposes not only of taxation but also for purposes of qualification for other state aid such as Medicaid or the chip program that additional money that $600 does not count as income and won't affect someone's qualifications for those other forms of relief Christy if you can go to the next slide please so slide 11 our deals with the actual stimulus payments that are spoken about regularly on in the media and that have been probably the highlight of the individual relief as many of you know the the cares Act calls for $1,200 payments to all Americans making $75,000 UPS or a hundred and fifty thousand dollars in the case of people filing married joint returns and a hundred and twelve thousand five hundred for the head of a household those figures are based on a story unadjusted gross income so in looking at whether you qualify you need to be certain that you're looking at your at your AGI not at your your total income in addition people will qualify for an additional payment of five hundred dollars for each child now there's been a lot in the media about when these payments are going to be issued the IRS officially is stating that they will start sending payments to most Americans in April some of the more recent media reports from both cnet.com and ABC News are indicating that the IRS is telling them that those payments are going to be made by mid April or at least start by mid-april and actually ABC News reported as early as or as late as this morning that they expect the first direct deposits to be made by early next week the some important notes about it those who have filed tax returns for 2019 the amount of of the stimulus check that you are going to receive will be based upon your 2019 adjusted gross income if you have not filed a 2019 report the figure will be based upon your 2018 adjusted gross income it does not matter if your 2018 income ends up being more favorable to you than your 2019 income the IRS will not be looking for paybacks of any kind if someone receives an overpayment based upon their 2019 earnings some other things to consider retirees those receiving Social Security VA retirement benefits disability benefits Railroad Retirement benefits they will still qualify and will receive direct deposit of their stimulus checks those who have not filed tax returns and have not provided direct deposit information to the IRS will be given an opportunity to to provide that information the IRS has not as of this morning promulgated that program they are saying that that's going to be provided on their website that has not happened as of yet anyone who is acclaimed dependent for someone else cannot also get a stimulus check this is primarily going to effect college students who may not be living at home but are still being claimed as dependents by their parents on their tax returns those students are not going to qualify for payments one other note on the those who have not filed tax returns and have not provided information see IRS TurboTax has actually set up its own portal to do an auto sign-in and provide direct deposit information I have not seen exactly how that works but that is located on TurboTax website and a warning about the these payments they are subject to significant scams there are already a number of of electronic scams out there and what the advice that the IRS and others have given is to understand that the IRS will never contact you and nor will the Treasury Department in general by electronic mail telephone or through social media so any contact you receive through those means is more likely than not a scam and should be ignored Christie if you can jump to the next slide please so the IRS are the cares Act also references a 2020 tax year tax credit that is not this is a little bit confusing and you will see that the at the bottom of this slide you'll see that it applies has the same phase-out application as the as the stimulus checks and applies the same amount of a tax credit as the stimulus checks that's because they're actually one in the same or at least very intertwined technically your stimulus check is an advance on a tax credit to offset your 2020 federal income taxes it's not a an advance on any refund check it is just an advance on a tax credit the provision for the tax credit is an allowance to basically close the loophole for people who may not qualify for a stimulus check at this point but maybe ston their 2020 a just a gross income and that would also apply for people who [Music] did not get as much of a stimulus check for 2019 for their 2019 income that they may be qualified for based on their 20/20 adjusted gross income so that is something that is not immediate and will be worked out when your taxes are filed as of next year and also just a note on that there's a lot of terms that have been floated around when you hear the term economic impact payment which is a term that the Treasury Department and the IRS are using it is the same thing as a recovery rebate which is the term that is used by some of the other government agencies and it's also the same thing as a stimulus check which is the same general term that most of the media has been using to to deal with these tax rebate checks so Christie you can go to the next slide please so the last of the the individual benefits that I'm going to address is I deals with distributions and loans from retirement plans basically what the Act did was removed the penalty for an early distribution from a an IRA or other some other employer sponsored retirement plans and that exemption of the 10% penalty applies up to any distribution of $100,000 or less the one important point to note is that while the 10% penalty has been exempted these distributions are still taxable as income that aspect of a distribution from your retirement count has not been changed if someone takes a distribution from their retirement account and is seeking to have the 10% penalty exemption applied the distribution needs to be what's called a corona virus related distribution and basically what that means is that you needed to take this distribution because one you were diagnosed with the corona virus - you had a family member who was diagnosed with the corona virus and you needed to care for that person or three that you suffered some adverse economic or financial impact as a result of the corona virus obviously that third provision is very very general and open-ended and waits to be seen how that is going to be defined but based on the the intent of the Act I would expect that it's going to be defined pretty broadly to allow people to take these distributions without penalty the cares Act also did increase the Matt Oh actually going back to the qualified distribution if you do take a distribution you are allowed to pay that distribution back into the plan over a three-year period and those payments will be considered in the same way as a rollover from another account would be treated so while you may be limited in the amount of money you can deposit in a retirement account or normal circumstances you're gonna be able to reconfigure this money as if it's a rollover from another account finally the cares Act has increased the amount the maximum amount that you can take as a loan from a qualified employer retirement plan the prior acts on a loan was $50,000 that has been increased to one hundred thousand dollars the Act also has extended the due date for any loan from a qualified employer plan to next year if that due date falls between the date the Act was signed March 27 2020 and at the end of this year so December 31st of 2020 makes it great for someone who had a due date of December 31st 2020 and the person with a due date of January 1st 2021 gets no benefit at all from it but it is a nice extension and that loan provision applies only for a hundred and eighty day period beginning on the date that the Act was passed so again running six months from March 27 2020 to what would be around September 27th of 2020 so that's it on the individual benefits and I will turn it over to Ray bareboat all right good afternoon everyone and thank you for joining us on this rainy day I'm going to talk briefly about some of the relief that is available to the Connecticut businesses I want to save time for Tony Joyce to actually go through the application process for you the the relief that we're going to talk about supplements or expand existing emergency relief so even though there is the cares act program in the PPP in particular there are other programs that are in existence some of which have been augmented by the cares Act there is the the economic injury disaster loan program which is an existing SBA loan program which assists businesses renters and homeowners located in regions affected by declared disasters of which one is the Kovac 19 which now affects every state in the Union there is also the the emergency $10,000 grant under the Eid L program I will touch upon that a little bit later on there is also a grants available to Connecticut manufacturers through April preference is given to manufacturers of PPE in the link is set forth in these slide there's also which was announced yesterday the head co de CDC MB I covet 19 response program which is a 20,000 dollar line of credit which is available for small businesses the business is required to to be minority-owned and/or women-owned small business minimum 51% of minority women ownership is required the line of credit is for up to $20,000 a 0% interest rate one year payable in full 12 months from the date of closing and it is to be used for working capital and there's no application fee and the the closing fee of $250 can be included in your cash flow projections the debt like the PPP is eligible to be given if the we can demonstrate that the funds were used to cover the first three months our expenditures due to Kovac 19 in order to receive the forgiveness the business must show documentation of expenditures and in accordance with your cash flow projections you might have also heard of the Connecticut decd bridge loans we are not showing that on this slide at the moment because the decd is not currently accepting applications it was basically exhausted and overwhelmed as of March 27th just just a couple other relief that you may want to look into is there has been text deadline extensions given by the government mortgage forbearance provisions with yo lenders so if you have a mortgage you want to reach out to your lender in that regard and if you have business interruption insurance you may be able to find some relief under that as well although many business interruption insurance policies take an exclusion of course for pandemics next slide Christie the accredits there is an employee retention tax credit for employers which is a little convoluted it took me a few minutes to figure out what this was was doing however it applies to closed or partially closed businesses which are experiencing significant revenue loss as a result of Kovac 19 it does not apply to state and federal governments or employers that accept small business loans if you apply for the Paycheck protection program you are not eligible for the employee retention tax credit it also only applies to wages paid after March 12 2020 and before January 1st 2021 the credits are capped at 50% of the qualified wages and qualified wages includes the employer portion of healthcare benefits it also applies to 501 C 3 charitable organizations next slide Christie please the credit notably provides for instant relief to any business who was applying for this program which obviously will help with cash flow it allows most employers to defer their share of applicable employment taxes from March 27th through December 31st the u.s. the employer are still required to withhold the payroll taxes from your employees paychecks however half of the deferred amount will be due on December 31 of next year and the other half will be due by December 31 2022 IRS guidance will be forthcoming the credit is applied against the employer portion of payroll taxes and the Treasury Department is working to develop a process to receive an advance payment of the tax credit the the credit to the wages that are taken into account are not limited to cash payments as I said earlier if you as the employer had 100 or fewer employees on the average in 2019 the credit will be based on wages paid to all employees regardless if they worked or not if the employees work full-time and were paid for full-time you still receive the credit as the employer if you had more than 100 employees on the average in 2019 the credit is allowed only for wages paid to employees who did not work during the calendar order you as the employer can seek immediate reimbursement by reducing your required deposits of payroll taxes withheld from employee wages by the amount of the credit you as the eligible employer will report your qualify wages and their related health insurance costs for each Porter on your quarterly employment tax return or 941 beginning with the second quarter and lastly if your employment tax deposits are not sufficient to cover the credit that you may apply to receive an advance payment from the IRS and the IRS has a form 7200 at 7200 which is the advance payment of employer credits due to Kovac 19 on next slide Cristy please the economic injury disaster loans as as you can see is for the period January 31 2020 through December 31 2020 one thing I want to note there is available in an immediate granted if you will have $10,000 which the SBA claims will be issued within three days of receipt of the application subject to verification that you are eligible into the program so even if it is ultimately determined that you are not eligible for the program you still get to keep that $10,000 grant I wanted to note I try to use the application which is online yesterday and there is something that you have to be aware of there is a checkbox that you must check in order to get the $10,000 in immediate grant so if you're going to apply online or even in paper make sure that you you check the box the advance may be used for any allowable purposes under the 7 b2 section of the small business act and is not subject to repayment even if your loan request is ultimately denied what are those what are those allowable purposes generally we're Capital is is allowable paid sick leave maintaining payroll rents mortgages and increased cost to obtain materials the total working capital loan can be up to two million dollars to recover temporary loss of revenue the the loan is capped at three and three-quarters percent for small businesses and two in t ree quarters percent for nonprofits under this long creditworthiness is a factor next slide Christie the cares act waves of the requirement of personal guarantees for loans up to two hundred thousand dollars and it also waives the requirement that you must be in business for a year however you must have been in operation on January 31 2020 and it's also waiving the credit elsewhere test that that is the requirement that this would be a lender of last resort you don't have to show that you could not have received a loan elsewhere the repayment starts after the the monthly deferment which can be up to four months and the deadline to apply for this loan is December sixteenth twenty twenty next slide Christie now the payroll protection program which I know is what everybody's been talking about first of all this is a first-come first-serve program and unfortunately I heard on the news this morning that almost two-thirds of the PPP has been allocated already Congress is meeting today in order to seek to add an additional two hundred fifty billion dollars for relief Nancy Pelosi is seeking to earmark additional 250 billion dollars for small businesses who are served through their community banks so there there is some attempt to to try to limit this expansion to small businesses many of which are online attending this webinar at the moment eligible borrowers work directly with SBA qualified lenders you don't work directly with the SBA and obviously Tony Joyce will talk with you about working with Joseph Cotten Bank there's also a link on there as to some of the resources and some of the Connecticut lenders who are participating in the program on next slide Christie thank you the covered loan is for the period February 15th to June 30th and as I indicated earlier this is a first-come first-served program and just rates cannot exceed one percent the maturity is two years after the loan is funded zero fees the SBA pays the fees there is no prepayment penalty for any payment made on the loan before December 31 2020 and all lenders offer these same terms businesses and specific nonprofit organizations with 500 or fewer employees are eligible nonprofit veterans organizations and tribal businesses concerns who meet the SBA standard small proprietors independent contractors and self-employed individuals tomorrow is when sole proprietors and independent contractors can start their application process April 10th businesses and organizations must have been an operation on February 15th and paid employees or independent contractors and employers must be located in the US or territories if slide Christy I think this now leads us to oh no one more how much can you borrow two and a half times your average total monthly payroll costs for 200 for 2019 up to ten million dollars for businesses not operational in 2019 two and a half times your average total monthly payroll costs incurred for January and February up to ten million dollars for seasonal employers two and a half times the average total monthly payments for payroll costs for the period of February of 2019 through March of 2019 and ending June of 2019 up to 10 million and the next slide Christy and what can you use the loan proceeds for payroll supports such as employees salaries and commissions paid secret paid sick or medical leave insurance premiums salaries of owners are included mortgage or rent payments utilities interest on other debt obligations and at least 75% of the loan must be used for payroll one thing I want to note that if for some reason at least some of your loan will not be forgiven perhaps you you couldn't meet the 75% requirement for your payroll this is one of the cheapest least expensive business loans that you can get so even if you have to pay 1% back in terms of interest on on this loan it's a great opportunity to take advantage of and I think now we're going to if you could go to the next slide Christy I think we're now going to turn it over to Tony well good afternoon everyone Tony Joyce I'm the senior lender for Chelsea Groton Bank and needless to say this has been a crazy time for banks and I'm sure everybody else on this call is having their own challenges as well so I'll try to give a little color I know we're very short on time the the slide package that you have here does a great job of synthesizing the program parameters just you know we can go through slide by slide but I think just in the in the interest of time maybe I'll just you can we can refer to the slides on your own or we can just give you some up-to-date information I it's hard for anybody to profess to be a expert on this because these regulations and the rollouts of information and rules change literally daily we get a morning update some of them contradict and override earlier releases so it's sort of a moving target I think suffice it to say this is probably one of the most liberal programs at least in my banking career that's ever been rolled out by the banks for the SBA these loans and it's important to note are unsecured unguaranteed and obviously likely to be forgiven which makes them the most attractive offering out there right now is is important to note if you did take one of those idle loans that they it has to be rolled into your PPP loan if you do opt to go for that and and your banker should be able to help you if you're having struggles going through the application material though the application for any of those who have looked at it is very simplistic the information that you need to give to the bank to support your application is very simplistic it does not have to be this is not wads and wads of paperwork which most of us have come to expect from excuse me hmm oh we've come to expect from SBA loans especially your bank loans in general it is the bank's role to verify the information that you as the borrower or the person requesting the funds have requested if you represent that your payroll was $100,000 and you give the bank some standard documentation 940s and or your your annual tax return or a financial statement and those numbers are very evident on that that is the end of the qualification process the bank approves it moves it along and tries I was I'm going to say try but now we're better at it I shouldn't say try we can get them into the SBA portal for anybody that started the process early and you heard from your banker that they couldn't get you moved ahead that was not an excuse that was a very realistic statement right up until probably the one day things opened up for availability for most most banks right now I will say as an update the SBA site is moving very rapidly to get it everybody approved it's down to about 15 20 minutes per application from the bank standpoint the banks are required to verify the information that they get from you prior to submitting the loan for approval and again it's not a very long or cumbersome process the next step is going to be closings we got the we as an industry got very little into support or direction from the federal government government regarding the type of documentation so each of us has sort of been left to our own devices we are just in the last two days getting the first round of guidance as to what the documents should look like or could look like in the Connecticut Bankers Association who is the industry association for most community banks anyway is actually formulating a draft note that can be used so try to be patient it's not it's not because people are trying to be avoiding of direct answers banks are trying to basically process five years worth of normal loan volume in a week so it's Scott everybody's everybody's operations gummed up under normal circumstances this would be enough of a challenge without any guidance it's you know it's become a virtual impossibility so please be patient with your bankers they are try trying to get the answers up there as fast and as best we can one of the provisions is the money has to be dispersed within ten days of the approval that the bank gets from the SBA so for those of you that have gotten word from your bank that your sba approval is in hand the money's not far into the future so it should be those the funding should start taking place in earnest from this point forward and again let's say I look maybe we'll talk to the loan forgiveness a little bit I think it's important for everybody to understand that this program as the name implies is a payroll protection program it's not meant to be a working capital loan the program does have a provision to allow for certain non payroll related expenditures from loan proceeds but just remember that there will be a proving out of the use of the funds on the other side of this transaction so the banks are tasked with tracking the disbursements of the loans for a period of two months basically it's eight weeks and at the end of that eight weeks we will in order for someone to get forgiveness on the loans they're going to have to prove out that they use the money for the allowed purposes under the program and without going into all the detail which again it's done is very well covered in the slides the basic criterias you have to spend at least seventy-five percent of it on payroll you can also use some of it for mortgage interest to rent or utilities but the idea is these are funds that are designed to go from the government through the banks to small companies to get into the payrolls of their employees they want this money in the in the employees pockets first and foremost so there will be a process of proving out how the money was spent we're going to require and some of the banks that talked are going to require that a new account be opened for these proceeds to make it easier to identify exactly how they were used and once the that process is done any amounts that are eligible for forgiveness will obviously be forgiven something to remember though that andhraite did bring up the point that it's a low low interest rate loan but you don't want to end up with a big piece of Unforgiven debt because the loans got to be amortized over the remaining 18 months so it's not well it's a it's a inexpensive from an interest rate standpoint it does not have a long duration as far as repayment so you know make sure everybody factors that in and really the intent of the program is for it to be used for payroll purposes if you want to go to the next slide Christy I think that's yeah that's pretty much it sorry I ran through it so fast that it's so we were as I said getting short on time and I'm happy to answer any questions alright great well thank you Tony and I do want to say that Tony and some other local lenders will be on a webinar with us on Tuesday if there are any PPP questions we can get to today same goes for the Eid el the economic injury disaster loans so just to crank through some of the questions while we have time with our speakers first up a scenario sort of question I've applied for the Paycheck protection program alone through my bank I pay myself which is myself a small salary filing quarterly nine for one forms but most of my income comes from distributions the application calls for a 940 or a Schedule C and neither give the full scope of the income what and how can I provide additional documentation to demonstrate my actual income well I'll take a stab at this most of our and I was so it actually on a Schedule C which is taking distribution I think what we were out we are allowed to use net profits from a Schedule C the distribution question is is not as clear-cut I'm sorry I would I'm not trying to be evasive but on the Schedule C we are allowed to use your net operating profit their distributions are different things they're not always from earnings sometimes they come out of capital so it's not as straightforward a question to answer okay so possible we may get some more insight on the Tuesday webinar as well for Christy I think this is more of an employer-employee question but is it improper for an employer to require an employee to stay home and then dock their personal days it seems that personal days could only be used if the employee stays home at their own option well that I think that that is a it's a very good question and prior to April first I think the advice might have been different if the individual qualifies for the paid sick leave which took effect on April first then there there may be a benefit there but if the if generally speaking the the there is there's you know I guess it depends on the reason that the employee was asked to stay home was it there was no no work was it because because they they may be couple somewhat error and the employer has has instituted a policy I think in order to properly answer the question it really does depend on the on the reason behind the the directive to stay home but if the individual after April first if the individual qualify under one of the provisions of the paid sick leave the paid sick leave must be exhausted prior to being able to use any other kind of leave thank you um question from a small business owner LLC that has employees but has been giving any profits including any pay that the owner would have made to the employees would I be eligible to file unemployment this is Ted it's an interesting question you would certainly suggest that you file for the unemployment and let them make a case-by-case espen on it you do theoretically need to show what your income had been and if you didn't have any they your application may be rejected but if you can show that you actually were taking those profits and then paying them back in they they may allow it it's a tough question yeah a lot of a lot of dumb questions we've reached begin site you can give you did mention that the state can choose to adopt the unemployment aspects of the Care Act does this mean that the state can potentially she did not participate so in theory yes what the Act says is that the the federal government and the states are are going to try and reach an agreement every indication that I've seen is that Connecticut is working with the federal government and just waiting on got further guidance as to how these programs are going to work and I fully expect that the provisions will be adopted so so the answer is yes but I don't think that that will come into play okay okay um two questions on the PPP loan if we still have a minute will it be affected by the employee retention credit and will it be affected by those who are doing the shared work program mrs. Rivera Bo I believe that on one of the slides that Tony had I think that there was a reference to the credit and that you cannot use the credit as well as the PPP loan for the same wages if I'm not mistaken Tony well yeah again there's two different phases or slices first thing in the underwriting is the establishment of the size of the loan so that's where you go it's based on two and a half times what you've actually paid so if you've paid the wages and if that's a historical look back and then your forgiveness is based on what you pay going forward so if you've taken that credit you wouldn't have actually paid that out of your or if you're going to use that credit you can't get you can't get it from both places knowing that the the state of Connecticut has not adopted yet these they $600 unemployment benefit but assuming they do is it applicable to police who were laid off prior to the passage of the Kerr's act and do you knock someone on reduced hours for that that stimulus part will be prorated or does it have to do with full unemployment so both of those questions are not explicitly answered by the cares Act my reading of it is that six hundred dollars will go to anyone who qualifies for unemployment under under the Act so if you are getting extended benefits for someone who was already on unemployment I do have my reading of it is that they can expect to get to $600 I saw that question about the part-time and I tried to do a little bit of research while we were sitting here on online there really just isn't an answer to that yet and you know frankly I I i expect that yes there will be that $600 to to everyone who qualifies but I bet that's going to be part of the discussions with the state that perhaps some of those are going to be prorated to some extent but t at's an open question that we we don't know the answer to yet it is 115 so I just want to be respectful of our panel this time and you were a little bit over I really do appreciate the the time he's been taking and and to our attendees who a few are still on the line so thank you guys for first funding the time the recorded webinar and the PowerPoint will be sent to everyone who registered a lot of the questions are answered there no we did have to breeze through some of them but just in the interest of time I know there's also a governor's governor's doing a web call right now so you have to definitely understand but I want to thank Christy and Ray and Ted and Tony for participating today this was very helpful and those of you who didn't have have questions that you could get into the chat if you don't have them answered please feel free to pass them on to me you have my email when you get the confirmation of the recording and get them to the right person some of them are questions for the DOL that just can't be answered yet but we are doing our best to disseminate the information as fast as we can so thank you all and if there's anything you want to say in closing please go ahead and this is very bearable I just want to thank everyone for attending today's webinar and stay safe and thank you from Christy Kelly I do want like I said Sussman Shapiro is linked to the arc Ovid Resource Center is provided in this lab and we are you know a lot of the questions that were asked we're we're all waiting for more guidance our Resource Center just like I'm sure the the chambers will continue to update and provide summaries and we encourage you to check our check our website and contact us if you have any questions and this is Tony Joyce again thank okay good now go ahead Tony I was just gonna thank you thank you both the chamber and and Sussman Shapiro for having me I just give a couple resources to anybody that's still out there if they're trying to keep abreast of changes you know to sba.gov does a fairly good job of keeping up with the changes in the parameters of the program and home that Treasury gov has a daily update daily release as well of fa Q's and they've been very helpful I know to our borrowers and to us as bankers as well and this is Chet Heiser thank you to all of you who participated into the chamber just to follow up on Tony Tony's point about some of these fa Q's that are out there the Connecticut Department of Labor has updated a PHA to use as well that are are pretty solid obviously we don't know a lot of answers at this point and they don't either but they do have a lot of answers in there about what they're waiting on and just to hold off and actually I got a lot of information from the the irs.gov website there I think you sir are pretty good as well so there is a lot of information out there and to all of you on here feel free to call our office or email any of us with direct questions about these things and hopefully we can can deal with them Thanks and get everyone stay safe have a great day thank you thank you Thanks