Coronavirus: Will churches get relief from emergency government business loans?

Small businesses are trying to survive during the COVID-19 pandemic as many states have some sort of shut down order prohibiting large gatherings.

Some organizations that many people may not have realized are having much less income coming in than budgeted are churches. Houses of worship still have salaries to pay for not only church staff, but also men and women of the cloth.

>> Coronavirus: Small business loans begin; here’s what you need to know

The Small Business Administration is handing out $350 billion in loans for small businesses. While mom-and-pop ice cream shops would be on the list, so are churches apparently, NPR reported. Churches have lost money since weekly offerings used for church ministries have dried up with congregations not meeting during the pandemic.

The SBA’s loans come under the $2 trillion coronavirus relief package, or CARES Act, The Washington Post reported.

>> Got a question about the news? See our explainers here

The SBA program allows businesses with fewer than 500 employees to get up to $10 million in loans. At least 75% of the loan must go to payroll and are mostly forgivable, so most of the money does not have to be paid back.

“Right now our focus is on speed in terms of making sure these banks have the ability to get loans onto Main Street quickly,” Tom Sullivan, a vice president of the lobbying group U.S. Chamber of Commerce, told the Post.

Businesses can start the application process by clicking here.

>> Coronavirus: Allstate will return $600M in auto premiums to customers

“Faith-based organizations are eligible to receive SBA loans regardless of whether they provide social services. That is, no otherwise eligible organization will be disqualified from receiving a loan because of the religious nature, religious identity, or religious speech of the organization," the SBA said in a statement.

SBA Faith-Based FAQ Final by National Content Desk on Scribd

Vice President Mike Pence said in a conference call with pastors across the country that some of the money the churches banked on will not return once the pandemic ends, NPR reported.

>> Coronavirus: Hobby Lobby temporarily closes all store locations

This isn’t the first time the federal government came to the aid of churches. In 2018, the Federal Emergency Management Agency allowed churches to apply and be eligible for disaster help.

Those against the government’s help to churches claim it goes against the First Amendment, which stated, “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof,” NPR reported.

>> Coronavirus: BP, Amoco offer discount to first responders, health care workers

But advocates for the church funding said that by denying houses of worship the same help given to nonreligious groups is discriminatory.

The loans are for costs that were calculated between Feb. 15 and June 30, The Washington Post reported. Repayments start about six months after the loan was issued, with full payment due in about two years, but there are rules for loan forgiveness.