CARES Act Offers Relief for Churches with Paycheck Protection Program

The CARES Act, a legislative response by Congress to the COVID-19 outbreak signed into law by President Trump on March 27, offers financial relief for both individuals and businesses. One section, known as the Paycheck Protection Program (PPP), provides forgivable loans that could be a potential lifesaver for churches impacted by reduced income, according to Kevin Gilmore, director of Pensions and Benefits USA.

“The legislation opens up SBA loans to not-for-profits, including churches, to borrow up to two and a half times the amount of their average monthly payroll costs over the past 12 months,” Gilmore said. The loan funds are to cover operating needs like:

  • Payroll expenses, including wages and benefits;
  • Rent or interest expense on debt; and
  • Utilities.

Gilmore went on to say, “These are actually more like grants than loans, and may well be a significant answer for churches that otherwise might be forced to make difficult budget-cutting decisions that could affect their staffs.” He noted that these loans are especially attractive because they are:

  • Obtained through a local SBA-approved lender/bank;
  • Unsecured; no board/personal guarantees or mortgages; and
  • 100% forgiven if the proceeds are used for the above-noted types of expenditures within eight weeks of their receipt.

“We understand there are concerns about the possibility that "strings" might be attached by the government in the acquisition of SBA loans," Gilmore added. "These are warranted, and we are working with legal counsel, our professional associations, and other denominational leaders to clarify our joint concerns. However, I still encourage pastors/churches to seek out their local SBA lenders to get in line for the funding. One item of agreement among all concerned is that while $349 billion sounds like a lot, it is not enough to meet the expected initial demand from across our nation.”

Gilmore recommends churches begin by contacting banking institutions with which they have an existing relationship. The Global Ministry Center has prepared this Guidelines for Cares Application. You can find more about how the Cares Act can assist churches at this ECFA link. The U.S. Department of the Treasury Department has created this website with PPP information, including a loan application.

Pensions and Benefits USA is working to stay on top of how pastors and churches may benefit from the CARES Act. Visit for updates.

Note: This article is for informational and awareness purposes only. Pensions and Benefits USA does not provide legal or tax advice and does not endorse private or federal lending programs. We encourage churches to seek professional assistance from their own trusted and professional legal, tax, and business advisors.