Can a Florida Small Business Emergency Bridge Loan Help Your Small Business?

Our Pivoting to Recovery blog described the various federal financial relief programs available as a result of COVID-19. Florida business owners should be aware of an additional resource available to bridge financial losses caused by the pandemic.  The Florida Small Business Emergency Bridge Loan is a loan offered by the Florida Department of Economic Opportunity through a program that has existed since the 1990s.  When the Governor makes a disaster declaration and activates the loan program, it functions as a source of funds to bridge business operations until other funding can be obtained.  You can borrow up to $50,000 if you qualify.

For the COVID-19 activation of the program qualification requirements include a business being established prior to March 9, 2020 with 2-100 employees.  Businesses also must have repaid in full any prior loans granted under the program, be creditworthy and demonstrate an ability to pay the loan back using other proceeds (federal loans, bank loans etc).  The loan is zero interest for 1 year, but then jumps to 12% interest if not repaid in the first twelve months.

In this program, businesses with 1099 contractors as employees can count as them for qualification purposes in certain circumstances.  This may be a good resource for a business waiting for a federal Small Business Administration economic injury disaster loan to be processed.

A large number of applications have already been received by the state and there is no established estimate of processing time.  Businesses can apply until May 8, 2020. Required documentation includes 2 years of business income tax returns, payroll tax returns and the individual tax returns of people owning at least 51% of the business.  Businesses will also need to submit financial statements for the past 2 years, interim financial statements (profit and loss) for the current year to date, additional documentation for monthly sales figures and an explanation of any irregularities in the credit report.  If the loan committee asks for additional information, responsive information is due within 7 days of the request.  The application asks each business to describe the economic injury that suffered as a result of the COVID-19 pandemic.