State loan program now open to PPP recipients

Small businesses and nonprofits that have received federal Paycheck Protection Program loans will now be able to get help through a new state loan program.

The New York Forward Loan Fund was launched in May as a way of offering working capital to small businesses that had until that point been unable to get federal relief. But that restriction also limited the program’s reach, as many applicants received federal loans before being able to access the New York Forward Loan Fund.

“Through discussions with lenders and applicants, it became apparent that PPP loans did not go far enough to support New York-based small businesses,” according to a press release from Empire State Development, which runs the loan program. “Legislative criteria restricted how the government assistance could be spent, and oftentimes PPP amounts were a fraction of what was needed and requested.”

Community development financial institutions processing applications for the fund will contact previously ineligible applicants to see if they are still interested. Only small businesses and nonprofits with 20 or fewer employees that received PPP loans of up to $50,000 will be eligible to apply. Nonprofits can apply for a 60-month loan at a 2% fixed interest rate to cover expenses like payroll, utilities and property taxes.