Coronavirus Aid, Relief, and Economic Security Act “Phase III”

On March 26, 2020, the Senate passed “Phase III” of the Coronavirus Response Package, the Coronavirus Aid, Relief, and Economic Security (CARES) Act in a 96-0 vote. The $2 trillion Phase III package contains scores of provisions providing relief to large segments of the United States economy decimated by the crisis. Specifically, for NECA Contractors, the CARES Act includes assistance to small businesses in the form of several loan options through the Small Business Administration (SBA).


Paycheck Protection Program: The CARES Act establishes a new $349 billion Paycheck Protection Program. The Program will provide much-needed relief to millions of small businesses (those with less than 500 employees) so they can sustain their businesses and keep their workers employed.

  • The new loan program will be available retroactive from February 15, 2020, so employers can rehire their recently laid-off employees through June 30, 2020.
  • Loan Terms & Conditions:
    • Eligible Businesses: All small businesses with 500 or fewer employees, or no greater than the number of employees set by the SBA as the size standard for certain industries.
    • Maximum loan amount up to $10 million
    • Loan forgiveness if proceeds used for payroll costs and other designated business operating expenses in the 8 weeks following the date of loan origination (due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs)
    • All loans under this program will have the following identical features:
      • Interest rate of 0.5%
      • Maturity of 2 years
      • First payment deferred for six months
      • 100% guarantee by SBA
      • No collateral, personal guarantees and no borrower or lender fees payable to SBA

NECA has compiled several helpful documents to better understand your business options as a result of this new law:

NECA will keep you informed as more information becomes available through guidance issued from federal agencies. The best course of action for NECA Contractors right now is to review the different loan options available and determine the best choice for your company.

NorCal NECA has signed the following MOU’s explaining which fringe benefits are due when using PPP funds to pay for furloughed employees or employees who are not working.


Paycheck Protection Program Loan Forgiveness:

On the evening of May 15, 2020, the Small Business Administration (SBA), in consultation with the Department of Treasury, released the Paycheck Protection Program (PPP) Loan Forgiveness Application and detailed instructions for the application. The form and instructions inform borrowers how to apply for forgiveness of their PPP loans, consistent with the Coronavirus Aid, Relief and Economic Security Act (CARES Act). SBA will also soon issue regulations and guidance to further assist borrowers as they complete their applications, and to provide lenders with guidance on their responsibilities. Click here to view the applications and instructions.