By Chelsea Langston Bombino and Dr. Stanley Carlson-Thies
Many small faith-based nonprofits and congregational communities, especially those in rural areas and in urban centers, are under-resourced, undernetworked, and are likely to not have a pre-existing lending relationship with a bank. These organizations and houses of worship provide vital spiritual and physical resources and services for their communities, especially in times of crisis. Yet they are face additional challenges in applying for loans from the Small Business Administration, as promised by the Coronavirus Aid, Relief and Emergency Services) CARES Act. As one leader in the Black church told us:
“The Black church, in particular, has often been heralded for its valuable contribution to the communities they serve. But the trend of larger majority nonprofits and businesses receiving the bulk of the [government] resources is once again glaringly staring in the faces of these churches during this COVID-19 pandemic. With many of its congregants and community members at the bottom of the economic ladder, we again believe that we will be left behind as the parameters for funds seeking will again require us to compete with the majority organizations [who already have more access to lending institutions, attorneys, and private donor dollars]?”
Due to the challenges these smaller FBOs and congregations face, we are closely following the following update:
The President signed today, Friday, April 24, a bill providing extensions and modifications of the Small Business Administration’s Paycheck Protection Program (PPP) and the EIDL emergency loan and grant program. This action gives nonprofits, including churches and faith-based organizations, small businesses, and self-employed individuals and independent contractors another opportunity to receive federal support designed to counteract the economic crisis caused by the COVID-19 pandemic. Organizations and individuals needing this help should act quickly. The PPP program likely will restart on Monday, April 27th.
About the Paycheck Protection Program (PPP):
For small organizations and self-employed individuals and independent contractors.
Includes a total of $310 billion more for loans
$60 billion is set-aside for loans made by mid- and small-sized community banks, credit unions, and institutions that serve underserved or low-income communities.
Originators of these set-aside loans include minority depository institutions, which are predominantly led by and serve minority communities, and community development financial institutions (CDFIs), which are dedicated to promoting economic development and providing education and other supports to borrowers.
Action: Applicants not already working with a willing financial institution may consider local community banks, including including minority-led banks; credit unions with whom they have a relationship; or CDFIs serving their community.
The SBA in a new question added to its general FAQ document has stressed that, to qualify for a loan, applicants “must certify in good faith that their PPP loan request is necessary”; larger companies that have other resources they can tap are warned away from PPP loans.
EIDL loans and Emergency Grants
Apply through the SBA website.
Additional $50 billion for the Disaster Loans Program Account.
Additional $10 billion for the EIDL emergency grants.
Makes small agricultural enterprises eligible for EIDL loans and grants.
PPP Loans, Public Justice and Your Story
During COVID-19, a public justice perspective requires us to recognize that in order to restore a community, we must restore the diverse social institutions in which community members live their lives. Please send us your observations and concerns, including the barriers you face in navigating the PPP loan process. Note that while we may not be able to respond to each of you individually, we will use your feedback to both shape what we express to public officials regarding the concerns of faith-based institutions, and we will use your feedback to shape future content, in the form of written resources and webinars we will be providing.
Dr. Stanley Carlson-Thies is the founder and senior founder of the Institutional Religious Freedom Alliance, a division of the Center for Public Justice. As part of this role, he convenes the Coalition to Preserve Religious Freedom, a multi-faith alliance of social-service, education, and religious freedom organizations that advocates for the religious freedom of faith-based organizations to Congress and the federal government. In addition he is also a Senior Fellow at the Canadian think tank Cardus. Stanley is co-author, with Steve Monsma, Free to Serve: Protecting the Religious Freedom of Faith-Based Organizations (Brazos Press 2015).
Chelsea Langston Bombino is the director of Sacred Sector, an initiative of the Center for Public Justice. Sacred Sector is a learning community for faith-based organizations and emerging leaders within the faith-based nonprofit sector to integrate and fully embody their sacred missions in every area of organizational life. Chelsea also serves as an adjunct professor for Pepperdine University and serves on the board of several nonprofit organizations, including First Amendment Voice and Young Leaders Institute.
WANT TO GET INVOLVED?
Know a seminarian or a faith-based organization? Connect them with Sacred Sector’s Fellowship and Community, designed to equip individuals and organizations to live out their faith-shaped callings. Email virginia.creasy@cpjustice.org for more information.
Sign up for the Sacred Spotlight monthly newsletter to stay updated on this series and learn more about Sacred Sector’s learning communities.
How is your faith-based organization living its mission? Share your story with us.