New York launches $100M loan fund for small businesses, nonprofits

Small businesses and nonprofits in New York that missed out on getting help through federal COVID-19 relief programs have a new potential funding stream. Organizations with fewer than 20 full-time employees can apply to be part of the New York Forward Loan Fund, a $100 million program operated by New York state starting on Tuesday, Gothamist reports. 

The loans are only available to entities offering direct services such as after-school programs or food assistance with gross revenues totaling less than $3 million per year. They also must not have received funding from the federal Paycheck Protection Program or Economic Injury Disaster Loan program.

Nonprofits are eligible to receive a loan of either $100,000 or equivalent to the average amount of expenses accrued during a three-month period. The fixed annual interest rate for loans given to nonprofits is 2%.

The greatest share of the funding will be set aside for businesses and organizations in New York City, which will receive 30% of all the loans. Priority will be given to institutions in regions that have already been reopened once the application process begins Tuesday afternoon. Nonprofits and others in areas that are still shuttered can get a head start by preparing a pre-application in advance. 

New York City previously created a funding initiative that was open to nonprofits in need of financial help during the pandemic. But the $10 million program, meant to help organizations with fewer than five employees cover payroll costs, ran out of money last month. Local elected officials also slammed the initiative for disproportionately funding groups based in Manhattan rather than the outer boroughs.