Almost as soon as President Donald Trump said $50 billion would be made available for coronavirus-related small business disaster loans, S.C. Gov. Henry McMaster requested a share of the capital for the Palmetto State.
“We’ve been in contact, as you know, with the vice president, with the Secretary Azar of Health and Human Services,” McMaster said Thursday when asked about Trump’s announcement. “We’re in contact with the White House to determine what is available there. The president, as you know, has announced a lot of very big steps. The things that we are doing are consistent with all those (offices).”
The governor, in Greenville to meet with an Irish delegation opening an office in the Upstate, confirmed that he had sent a request to the U.S. Small Business Administration and has been communicating with the other federal government departments on the decision. He also noted he and his staff are listening to health experts as they make decisions on behalf of the state, particularly regarding whether to close South Carolina schools.
“Our team is ready to swing into action even more than we have already done in a second’s notice,” he said.
The Coronavirus Preparedness and Response Supplemental Appropriations Act (pdf) will offer small businesses and non-profits “suffering substantial economic injury” loans up to $2 million from the SBA if requested by a state’s governor, according to an SBA news release.
The SBA announced it would work with state governors to “provide targeted, low-interest disaster recovery loans to small businesses that have been severely impacted by the situation.”
The decision coincides with the governor’s request Thursday morning to reallocate $45 million from the 2019-2020 Contingency Reserve Fund to the S.C. Department of Health and Environmental Control’s efforts to fight COVID-19, the illness caused by the coronavirus. In a statement released on March 8, McMaster said the new coronavirus was “no cause for public alarm or speculation.”
During the Greenville office unveiling Thursday afternoon, McMaster said the state demonstrates its strength during adversity, but acknowledged COVID-19’s toll on the local economy, especially on the state’s automotive sectors. He said his team is staying alert and informed on the economic and public health threat.
“If you watch the stock market, that is a good indicator how things are going,” he said. “We know that the supply chain from China — where you know we get a lot of our parts in the automobile manufacturing industry and others — has been discontinued in some instances and substantially slowing in others, so the manufacturers are finding other ways, other options, to get those (supplies). It will have an impact. Anything like this has an impact. Institutions are strong, we are resilient, and I am confident we will come out of it. I’d like to start coming out of it soon, but we don’t know if we’re in the depths of it.”
He said manufacturers are learning how to innovate and redirect their supply chain to domestic sources, while others are tweaking their production process to create in-demand products with existing equipment.
“That’s the beauty of free enterprise. When one door closes, you open up another. It takes accommodation, it takes a little time, but the economic future of the country and our state is still bright and is going to be even brighter,” McMaster said.
The governor was unsure when the loans will be made available, but once the SBA issues an Economic Injury Disaster Loan declaration, affected communities will be notified on the application process, according to Thursday’s news release.
Non-profits will be able to apply for loans with a 2.75% interest rate, while eligible small businesses without an external credit source can apply for loans at a 3.75% interest rate.