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Your PPP questions answered

PPP loan app

As Congress passes legislation for additional dollars to help small businesses, the Conference Trustees answer questions regarding the application for PPP loans.


JAMES LEBARON
Chair, Michigan Conference Board of Trustees

Many of you are aware of the efforts to meet the economic challenges arising from the COVID-19 pandemic. Included in these efforts is the CARES ACT provision for the employee paycheck concerns.

Under the auspices of the SBA, lenders are offering low-interest loans to meet a 2.5 month payroll amount. Further, the borrower, upon satisfying specific reporting and usage requirements, will not have to repay the loan, functionally converting it to a grant. On April 21 additional funds were made available, see Congress and the White House act to replenish funding.

There have been some questions beyond prior posted advertisements.  

If your local church is considering this program please be advised that:

  • Only the local church is named as borrower. Neither the annual conference nor the district is to be construed as involved as borrower or guarantor.
  • Where the application inquires if there is an additional “governing body,” do not name the annual conference or district. You are self-governed by your articles of incorporation.
  • This loan is designed to be unsecured (i.e. no mortgage involved or recorded); hence, there is no disciplinary requirement for your district Board of Church Location and Building to approve. Nor does applying for a Cares Act PPP loan require Charge Conference approval.  Your Local church Church Council/Governing Board procedures for action through meetings is sufficient.
  • You should consult with your District Superintendent to ensure the internal staffing expertise and controls to meet the reporting requirements. This is to avoid a circumstance wherein the loan must be repaid due to compliance failure. 

If you choose to participate we hope the program enhances both your ministry and your financial health. Contact your D.S. with any additional questions.