New York Forward Loan Fund (NYFLF)
May 22, 2020
Dear Clients, Colleagues and Friends,
Presti & Naegele continues to monitor the latest COVID-19 developments that impact our clients. Below is information we believe may be useful to you.
New York Forward Loan Fund
New York Forward Loan Fund (NYFLF) is a new economic recovery loan program aimed at supporting New York State small businesses, nonprofits, and small landlords as they reopen after the COVID-19 outbreak and NYS on PAUSE. For additional information on the loan program, please visit the NYS website here.
NYFLF targets the state’s small businesses with 20 or fewer full-time equivalent (FTE) employees (90% of all businesses), nonprofits, and small landlords that have seen a loss of rental income.
NYFLF is providing working capital loans so that small businesses, nonprofits, and small landlords have access to credit as they reopen. These loans are available to small businesses, nonprofits, and small landlords that did not receive a loan from either the U.S. Small Business Administration (SBA) Paycheck Protection Program (PPP) or SBA Economic Injury Disaster Loans (EIDL) for COVID-19 in 2020. The loans are not forgivable in part or whole. The loans will need to be paid back over a 5-year term with interest.
The working capital loans are timed to support businesses and organizations as they proceed to reopen and have upfront expenses to comply with guidelines (e.g., inventory, marketing, refitting for new social distancing guidelines) under the New York Forward Plan.
The geographic proportionality goals for the New York Forward Loan Fund for small businesses are:
· Capital Region 4%
· Central NY Region 4%
· Finger Lakes Region 4%
· Hudson Valley Region 12%
· Long Island Region 18%
· Mohawk Valley Region 4%
· NYC Region 30%
· North Country Region 4%
· Southern Tier Region 4%
· Western NY Region 8%
Access to loans for small landlords will be targeted to owners with residential buildings of 50 units or less and will prioritize loans for landlords whose properties are in low- and moderate-income census tracts or who serve low to moderate income tenants.
The New York Forward Loan Fund is supported by Apple Bank, BNB Bank, BlackRock Charitable Fund, Citi Foundation, Evans Bank, Ford Foundation, M&T Bank, Morgan Stanley, Ralph C. Wilson, Jr. Foundation, and Wells Fargo.
Pre-applications for the New York Forward Loan Fund will be open on May 26, 2020 at Noon Eastern Daylight Time. Priority will be given to industries and regions that have been reopened. This is not a first-come, first-served loan program. Applications will be reviewed on a rolling basis as regions and industries reopen. For small businesses and nonprofits that are in industries and regions that have not yet reopened, you are encouraged to prepare your pre-application in advance by taking advantage of the application preparation resources available here. This will allow you to quickly submit your pre-application once it is announced that your industry and region is phased to reopen.
Five Community Development Financial Institutions (CDFIs) will be processing pre-applications on June 1, 2020: Accion East, Community Preservation Corporation, National Development Council, Pursuit and TruFund Financial Services. Please do not apply to the participating CDFI lender directly.
To fill out a pre-application and match with a participating lender, please click here.
The loan terms are as follows:
· Loan Amount:
1. Small Businesses: Small businesses can apply for a loan in the amount of the lesser of (a) $100,000 or (b) up to 100% of average monthly revenues in any 3-month period from 2019 or first quarter of 2020.
2. Nonprofits: Nonprofits can apply for a loan in the amount of the lesser of (a) $100,000 or (b) up to 100% of average monthly expenses in any 3-month from 2019 or first quarter of 2020.
3. Small Landlords: Small Landlords can apply for a loan in the amount the lesser of (a) $100,000 or (b) projected reduction in 3-months’ net operating income based on actual reductions in net operating income for the month of April or May 2020.
· Interest Rate:
1. Small businesses and landlords: The fixed annual interest rate on the loan will be 3%.
2. Nonprofits: The fixed annual interest rate on the loan will be 2%.
1. For months 1 – 12: Interest only payments, paid monthly.
2. For months 13 – 60: interest and principal payments, paid monthly.
· Term: 5 years (60 months).
1. Proceeds are required to be used for working capital, inventory, marketing, refitting for new social distancing guidelines, operating and emergency maintenance, property taxes, utilities, rent, supplies, etc.
2. Refinancing of an existing loan is not permitted.
3. The loan applicant will be required to detail anticipated use of funds when they apply.
· Borrower Fees: No application fees. Late fee will be assessed for missed payments.
· Recourse: No collateral is required.
· Prepayment: Borrower may prepay the loan without penalty.
If you have any questions or need further information, please contact your P&N professional directly, or dial 212-736-0055 for immediate help. For additional updates and guidance regarding COVID-19, please visit the ‘News’ section of our website at www.pntax.com. Stay Safe.
Presti & Naegele