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COVID-19 Financial Relief for Schools & Educators
While the pandemic has turned the world on its head and made running any type of business more challenging, it has been especially hard for those in charge of operating schools. Along with the constant stress of ensuring quality education, being a director of a small- or medium-sized school right now comes with a variety of unforeseen circumstances. How to deal with changes in enrollment and having proper safety protocols to adhere to COVID safety are just a few examples. There’s no denying that one of the more difficult problems brought about by this past year has been monetary. However, no matter the shortfall you’re facing, there are programs to help. Here are some of the resources designed to help businesses like yours overcome the financial burden that this past year has caused.
Paycheck Protection Program (PPP)
The federal financial assistance program that has gotten the most press in recent months is the Paycheck Protection Program, also called PPP. Backed by the U.S. Small Business Administration, the PPP loan program is designed to help small business owners keep employees on payroll. However, the funds can also be used to help with mortgage interest, rent, utilities, and worker protection costs. The federal government will forgive the loan, provided that all the requirements are met. Directors of schools who have not received a PPP loan can apply for the first draw of the loan, while those who have already received one PPP loan are eligible for a second draw. President Joe Biden took actions to increase equitability of the PPP loan to businesses with fewer than 20 employees. It does require some thorough research to ensure your microschool qualifies, so it’s moments like these that prove beneficial to be part of a network of school directors. Wonderschool, for example, offers its community of school directors one-on-one support to complete the PPP loan, resulting in a higher approval rate than the national average.
Other SBA Assistance Options
The SBA has outlined a number of financial assistance options for small business owners, many of which you may be eligible for as a director of a small- or medium-sized school. If you’ve experienced a loss in enrollment, and thus a loss in revenue, then you might be eligible for the COVID-19 Economic Injury Disaster Loan. While it doesn’t have the same forgiveness plan that the PPP loan does, this low-interest loan is designed to assist small business owners through this difficult time. The loan has an interest rate of 3.75% for 30 years, though requires collateral for loan amounts over $25,000. If you already have a business relationship with an SBA Express Lender, then you may be able to access $25,000 quickly through the SBA Express Bridge Loan. This money is meant to act as bridge funding while applying to other loans. The SBA is offering another option to current SBA loan borrowers in the form of COVID-19 debt relief, paying six months’ worth in principal, interest, and any associated fees.
The Coronavirus Aid, Relief, and Economic Security Act, also called the CARES act, is a $2.2 trillion stimulus bill that passed in March 2020. A portion of these funds is funneled into the Elementary and Secondary School Emergency Relief Fund, intended for schools serving those in poverty, and the Governor’s Emergency Education Relief Fund, which gives more discretion on the funds’ use to each state’s governor.
In December 2020, Congress approved a $900 billion relief package that included about $82 billion for education, which includes $54.3 billion for K-12 schools — nearly four times the amount earmarked in the CARES Act. The bill earmarked $7 billion to expand broadband access and $10 billion for child care. If you think your school qualifies for one of these programs, reach out to your state education agency or your state’s governor’s office to get more information on how to apply for a grant.
Another Proposed Bill
In a $1.9 trillion stimulus package proposed by US President Joe Biden, an additional $170 billion would be set aside for K-12 schools and higher education. These funds would help ensure buildings can safely reopen and students can recover academically. In the proposal, which the House approved in late February, $60 billion is intended to prevent layoffs and $50 billion is meant for modifications to adhere to physical distancing guidelines.
While this has been a tough year on many fronts, the financial burdens felt by many microschool directors and other small business owners have been significant. Keep in mind that you don’t have to go at it alone. Having a better understanding of the financial resources intended to help keep businesses like yours afloat during this tough time is an important first step toward getting back on track to meeting your goals.