FAQ: Early Childhood Business Assistance for COVID-19

by | Mar 20, 2020

Updated 3.31.20

The COVID-19 emergency has put a profound strain on Nebraska's early childhood small businesses. This guide provides information on state and federal programs that can help small business owners cope with the pandemic. 

Frequently Asked Questions

If I am a home provider, sole proprietership, early childhood or child care business owner, what economic assistance is available?

Under the CARES Act, you may be eligible for a variety of programs under the Small Business Administration (SBA), including Economic Injury Loan/Advance or a Paycheck Protection Program (PPP) Loan

Economic Injury Disaster Loan & Advance

The Small Business Administration is a federal government agency that provides supports to small businesses and entrepreneurs. The SBA offers a disaster loan program for businesses that are affected due to a direct result of a disaster. The business would need to be located in a declared disaster area to be eligible for assistance.

The entire State of Nebraska has been designated as a declared disaster area.

Early Childhood Programs and Businesses including self-employed child care providers would be eligible under the economic injury category. Economic injury means the business is unable to meet its obligations and pay ordinary and necessary operating expenses. The disaster loan assistance would provide the necessary working capital to help small businesses survive until normal operations resume after a disaster.

Additionally, as part of the economic injury disaster loan program there is also a loan advance. The loan advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue. Funds will be made available within three days of a successful application, and this loan advance will not have to be repaid.

Apply for an Economic Injury Disaster Loan & Advance


What types of early childhood and child care businesses are eligible for a Paycheck Protection Program (PPP) Loan?

  • Must have been in operation on February 15, 2020
  • Individuals who operate a sole proprietership, are eligible self-employed individuals or independent contactors
  • Small businesses, 501(c)(3) nonprofit organizations, 501(c)(19) veteran's organizations, or Tribal business concerns that has fewer than 500 employees


Paycheck Protection Program (PPP) Loan

The Paycheck Protection Loan Program provides cash-flow assistance loans to employers who maintain their payroll during this emergency. If employers maintain their workforce, the SBA will forgive the portion of the loan proceeds that are used to cover the first 8 weeks of payroll and certain other expenses following loan origination. Small businesses and other eligible entities will be able to apply if they were harmed by COVID-19 between February 15 and June 30, 2020. 

The application form is to be completed by the Applicant and submitted to your SBA Participating Lender. Nearly all of the banks in Nebraska are SBA-certified. Submission of the requested information is required to make a determination regarding eligibility for financial assistance. Failure to submit the information would affect that determination. To prepare to submit an application, you can download a sample form to see what type of information will be requested. 

Apply for the Paycheck Protection Loan Program

What costs are eligible for payroll?

  • Compensation (salary, wage, commission, or similar compensation, payment of cash tip or equivalent)
  • Payment for vacation, parental, family, medical, or sick leave
  • Allowance for dismissal or separation
  • Payment required for the provisions of group health care benefits, including insurance premiums
  • Payment of any retirement benefit
  • Payment of State or local tax assessed on the compensation of employees


What are allowable uses of loan proceeds?

  • Payroll costs (as noted above)
  • Costs related to the continuation of group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums
  • Employee salaries, commissions, or similar compensations (see exclusions above)
  • Payments of interest on any mortgage obligation (which shall not include any prepayment of or payment of principal on a mortgage obligation)
  • Rent (including rent under a lease agreement)
  • Utilities
  • Interest on any other debt obligations that were incurred before the covered period


SBA – Nebraska District Office
10675 Bedford Ave., Suite 100
Omaha, NE
Phone: 402-221-4691
Twitter: @SBA_Nebraska
Website: sba.gov/offices/district/ne/omaha


Best Practices

Your local lender is the best first place to begin with any COVID-19 related financial business assistance. They will be able to determine your program eligibility and also help you compile the documentation and financial information needed for the application process.


What resources are available for self-employed individuals or employees of child care businesses?

Self-employed business owners and individual employees may be eligible for emergency federal or state Unemployment Insurance benefits. Find more information at FAQ: Unemployment Benefits for Early Childhood Professionals during COVID-19.  

More Resources

State of Nebraska Assistance: Short-Time Compensation

If your child care business has a minimum of 3 employees and has had to reduce the number of work hours due to the COVID-19 pandemic, they may be eligible to received Short-Time Compensation (STC) through the Nebraska Department of Labor. The STC program helps businesses retain workforce during a temporary slowdown in work. The program allows employers to voluntarily reduce staff hours rather than laying off employees.

How is eligibility determined?

The Nebraska Department of Labor will determine whether your company is current on its unemployment insurance taxes and whether the layoff is temporary and not related to seasonality or intermittent downturn. The employees’ hours must be reduced by at least 10%, but not more than 60%. The hours reduced in each affected unit must all be reduced by the same percentage.

NDOL Short-Time Compensation Program Overview


We'll continue to keep this page updated with business resources as the COVID-19 pandemic evolves.

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