SWAMC staff is actively engaged in conversations with other ARDORs, the Alaska Small Business Development Center, Alaska Municipal League, and other State and Federal agency representatives to sift through and understand the many resources available for businesses, municipalities, tribes, and individuals who are impacted by the COVID-19 pandemic. SWAMC staff doesn’t claim to be experts on these programs, but we will do our best to help in any way that we can.
The IRS recently released guidance on whether or not local and state CARES Act-funded grants were taxable and the answer was yes. Congress had not made a distinction that funds would be non-taxable when they released the $2.2T CARES Act COVID relief funds, and the IRS has ruled that any AK CARES grant funding and any local municipal grant funding received by a small business or individual are taxable. If you received an AK CARES grant or a local city grant please follow the link below for the newest information on how to file your taxes for 2020. PPP funds that are forgivable (at least 60% used for payroll expenses) are not taxable.
Small Businesses: The U.S. Chamber of Commerce website has information about the second pandemic relief package. Congress passed several changes to the Paycheck Protection Program (PPP) and created a “Second Draw” PPP for small businesses who have exhausted their initial loan. Other changes impact eligibility for initial PPP loans, the loan forgiveness process, and the tax treatment of PPP loans. Congress also made changes to other programs – including Economic Injury Disaster Loans (EIDL Program), the Employee Retention Tax Credit, a Venue Grant program, and SBA loan programs –that will benefit small businesses.
As long as the PPP funds are spent to keep employee and compensation levels maintained, they can be used for other eligible expenses including lease payments, mortgage interest, worker protection costs, utilities, and other business needs. If you spend at least 60% directly on payroll costs, the loan qualifies for full loan forgiveness. The PPP Loan has a 1% interest rate and there are no payments due for the first 10 months. The EIDL Loan has a 3.75% interest rate with a 30-year term, can be forgiven in some circumstances, and offers an advance grant (no payback) of $10,000 for small businesses and nonprofits in low-income communities.
Northrim Bank, First National Bank of Alaska, Wells Fargo, Bank of America, and Citibank are all participating in the PPP program and have information on the eligibility/application process and FAQs on their websites. The application process for PPP and EIDL loans will be open until March 31, but the money is expected to go fast.
Below is a link to a page with more details on the Relief Bill passed on December 27, 2020, provided by Jon Bittner, Executive Director of Alaska Small Business Development Center (SBDC) State Office.
SBDC staff also put together a how-to video on the PPP application:
SWAMC invites Southwest Alaska businesses to join FORWARD!
FORWARD is a free online tool provided by SWAMC that connects Southwest Alaska businesses (including commercial fishers and non-profits) to a comprehensive list of federal, state, and local resources — grants, loans, deferrals, and more. It’s a one-stop shop for businesses affected by COVID-19.
Many business owners know about PPP, EIDL, and the AK CARES grant, but there is more out there! Log in to FORWARD and browse everything that is available to you.
Note: FORWARD is a new program, and new programs sometimes have bugs. Known bugs are being worked on, but please let us know if you run into any issues. For best results, fill out every field in your business profile. And for businesses signing up for first-time access to FORWARD, there is a one-business-day turnaround time to receive your username and password.
SWAMC team member Keri is available to help answer questions about how to use FORWARD to access COVID-19 relief funding. Contact Keri at 907-242-4077 or forward@swamc.org.
The Alaska SBDC operates out of the UAA Business Enterprise Institute and they provide business guidance, services, and resources to Alaskan small businesses and entrepreneurs. Alaska SBDC is staffed by certified business advisors across the state and their services are free.
The Alaska Municipal League is a statewide organization of 165 cities, boroughs, and unified municipalities with a mission to represent Alaska’s local governments in state and federal decision making and provide training and services to strengthen Alaska’s local governments. Their Coronavirus resource page is tailored to the needs of cities and boroughs who are tasked with ensuring the health and safety of their residents.
This page includes health mandates issued by Governor Mike Dunleavy, DHSS Commissioner Adam Crum, and Chief Medical Officer Dr. Anne Zink; more information about Gov. Dunleavy’s 6-Point Economic Stabilization Plan; and information for Alaskans about unemployment insurance, small business assistance, homeowner information, and Federal government resources.