Legislation signed late December 27 by President Donald Trump includes provisions that could assist churches and ministry organizations, including additional funding for the Paycheck Protection Program (PPP), as well as direct payments to some taxpayers.
An additional $284 billon is made available for forgivable PPP loans, and $20 billion is included for Economic Injury Disaster Loans for businesses and nonprofits provided through the Small Business Administration (SBA). The PPP under the program are “Second Draw” loans. If a church or ministry has 300 or fewer employees, has sustained a 25% revenue loss in the first, second or third quarter of 2020 as compared to the same quarter in 2019, and has used, or will use, the full amount of the first PPP loan, then it is eligible for a Second Draw PPP loan.
GuideStone® has provided a question-and-answer document with key questions related to the new legislation.
The law provides that a church or ministry may borrow an amount equal to 2.5 months of average monthly payroll expenses up to a maximum of $2 million. Employers may not borrow more than $10 million in aggregate between the first and second PPP loans. Additionally, the law provides a more streamlined loan-forgiveness process for those applying for PPP loans under $150,000.
“Many Southern Baptist churches availed themselves of the Paycheck Protection Program and the Economic Injury Disaster Loans in the early part of 2020,” GuideStone President O.S. Hawkins said. “Every church and individual must come to their own decisions as to whether they feel it’s appropriate to pursue these options. While we would not presume to tell a pastor what he should do in these circumstances, we want to make this information available for churches who are interested in learning more.”
Churches and ministries should work with a local SBA-approved bank or credit union to apply for PPP loans. GuideStone does not provide banking services, including loans.
The legislation also provides for direct payments to individuals of $600 for each adult and $600 for each dependent for individuals with adjusted gross incomes up to $75,000 and married couples with adjusted gross incomes up to $150,000.
The legislation also provides for a $300-a-week federal unemployment subsidy. So-called gig workers, as well as others who do not traditionally qualify for unemployment benefits, are eligible to receive this assistance. This legislation also extends to 50 weeks — instead of the typical 26 weeks provided by most states — the time for which workers can apply for benefits. Workers who have both wage and self-employment income, but whose basic unemployment benefits do not account for their self-employment income, may qualify for an additional $100 a week in assistance.
The 5,593-page, $900 billion legislation additionally includes money for COVID-19 vaccine distribution. Its signing by President Trump averted a federal government shutdown.
Roy Hayhurst is director of denominational and public relations services for GuideStone Financial Resources of the Southern Baptist Convention®.
Director of Denominational and Public Relations Services
GuideStone Financial Resources of the Southern Baptist Convention
Roy.Hayhurst@GuideStone.org | (214) 720-2141