21 Jul 2020 Fed Expands Main Street Lending Program to Nonprofits
On July 17, 2020 the Federal Reserve Board released term sheets for two new Nonprofit Organization Loan Facilities, expanding eligibility under the Main Street Lending Program to nonprofit organizations meeting certain eligibility criteria.
Background
The Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) appropriated funding to the Federal Reserve to expand the Main Street Lending Program for businesses in need of funding options in light of COVID-19 pandemic. The Main Street Lending Program was not originally available to nonprofit applicants, however on June 15, 2020, the Federal Reserve requested public feedback on a proposed expansion to the program that would provide credit to nonprofit organizations described in sections 501(c)(3) or 501(c)(19) meeting certain eligibility requirements.
Nonprofit Organization Loan Facilities
The Federal Reserve Board voted to modify the Main Street Lending Program to provide greater access to credit for nonprofit organizations such as educational institutions, hospitals and social service organizations and approved two new loan options to provide support to tax-exempt organizations described in sections 501(c)(3) or 501(c)(19).
The nonprofit loan terms generally mirror those for Main Street Lending Program for-profit business loans. Nonprofit organizations will be eligible for new loans or for the expansion of existing loans, as detailed here.
This article was written by RSM US LLP and originally appeared on 2020-07-21. 2020 RSM US LLP. All rights reserved. https://rsmus.com/what-we-do/services/tax/federal-tax/fed-expands-main-street-lending-program-to-nonprofits.html
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