In response to the surprisingly low participation in the MSLP , the Federal Reserve sharply reduced the minimum loan size to participate in the MSLP . This move potentially unlocks access to the funds to more businesses . This is especially important to your business , considering Congress ’ inability to pass a second stimulus package thus far . To that end , the minimum loan size was reduced from $ 250,000 to $ 100,000 . To combat the lack of participation from banks , the Federal Reserve also changed the fee structure so that lenders will get paid higher fees for facilitating loans under $ 250,000 . Another noteworthy addition is that businesses that received under $ 2 million in PPP loans will now be eligible for the MSLP . The MSLP is currently set to expire Dec . 31 , 2020 . As such , if this is a program that may be helpful to your business , the time is now to begin your efforts to learn more and begin benefiting from support as needed .
In addition to the programs offered by the federal government , there were many financial support opportunities in the form of smaller loans or grants , as appropriate , offered by most state and local governments . These programs helped many operators throughout the United States . By way of example , the Michigan Small Business Relief Program provided up to $ 20 million in grants and loans to provide economic assistance to Michigan ’ s small businesses negatively impacted by COVID-19 in order to to help support workers and their families facing economic uncertainty during the outbreak . Likewise , Pennsylvania awarded $ 96 million in-state grants to 4,933 Pennsylvania small businesses impacted by the business closure order implemented by Gov . Tom Wolf . The grants were intended to cover operating expenses during the shutdown and to assist with the transition to re-opening , as well as technical assistance , including training and guidance for business owners as they stabilize and relaunch their businesses .
In line with the goals of the Michigan and Pennsylvania programs , there are many other programs that were available and / or remain available that business owners should consider accessing if and as needed . Furthermore , there may be additional programs that will be introduced or implemented in the coming weeks or months ; this is especially so once the election results settle in . In fact , presently pending before Congress are several industryspecific relief acts including the Health and Fitness Recovery Act of 2020 ( HFRA ). The HFRA would create a $ 30 billion fund to provide grants to affected businesses in the health and fitness industry . As proposed , grant amounts are capped at actual business loss of up to 10 % of the previous year ’ s revenue or $ 10 million , whichever is less . Every fitness facility operator should consider learning more about this program and what they can do to lend their support considering the positive impact it could bring to the industry .
To say these are uncharted times at this point is cliché , but it is the reality . The deluge of assistance available to operators is also a reality . All indicators seem to point to the fact that it will take time to fully rebound , so now is the time to explore all programs that may assist your business . G
Justin M . Klein is a franchise and business attorney and a partner with the nationally recognized franchise law firm of Marks & Klein LLP , which represents Planet Fitness ® franchise operators throughout the United States . You can contact Klein at justin @ marksklein . com .
GearedUp | 2020 Issue 4
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