This week, a companion bill to the Senate’s RESTART Act, introduced by Senators Todd Young (R-IN) and Michael Bennet (D-CO), is expected to be introduced in the House of Representatives. The RV industry supports this legislation, which works to build upon the Paycheck Protection Program by enhancing the program to ensure that more of the hardest hit American small and medium sized businesses have access to vital assistance. RESTART would provide funding to cover six months of payroll, benefits, and fixed operating expenses for businesses that have taken a substantial revenue hit during the COVID-19 pandemic.
We applaud Senators Young and Bennet for introducing legislation that will help more businesses with liquidity to get up and running again as the nation recovers. This legislation will help ensure that many small and medium sized RV businesses can stay afloat as we see more and more Americans expressing an interest in the RV lifestyle.
(Photo L to R: Senator Todd Young and Senator Michael Bennet)
How It Works
- The loans cover six months of payroll, benefits, and fixed operating expenses for businesses and nonprofits with fewer than 5,000 full-time equivalent employees that have seen revenues decline by at least 25 percent. The loans provide an extended 12-month forgiveness period for businesses that have seen revenues decline by at least 80 percent.
- The maximum loan size is capped at the lesser of 45 percent of 2019 gross receipts or $12 million.
- Comparisons between 2020 and 2019 gross receipts are based on either the full calendar years or between the RESTART loan’s six-month covered period and a comparable six-month period a year earlier at the borrower’s option.
- Businesses choose when to rehire their workers and when to deploy the capital.
- Forgiveness is based on revenue declines suffered by the business in 2020, with the remainder of the loan repaid over seven years.
- Smaller businesses with fewer than 500 employees receive even more favorable terms on loan forgiveness.
- Nonprofits are eligible for a 10-year loan with more favorable terms than businesses, including a longer duration of up to 10 years and a lower interest rate for the first four years.
- Nonprofits with up to 500 employees are provided an option for loan forgiveness, with the remaining loan subject to the same terms as businesses.
- No interest payments are due in the first year and no principal payments are due for the first two years. Additional deferral is available to economically distressed firms.
- Origination fees range from 3.75 percent to 0.75 percent depending on the loan size, with the fee structure designed to provide an incentive for banks and other financial institutions to assist the smallest businesses.
- The loan is 100 percent guaranteed by the federal government and is applied for through banks and other lenders.