A new Faith-Based Organizations FAQ posted by the Small Business Administration (SBA) clarifies that religious organizations, including churches, are eligible to participate in the financial assistance programs offered under the CARES Act.

The FAQ specifically addresses questions surrounding religious freedom related to the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan Program (EIDL). For more ECFA resources and help on the PPP and EIDL programs under the CARES Act, visit ECFA.org/covid19.

In responding to the opening question regarding eligibility, the SBA clarifies that “faith-based organizations are eligible to receive SBA loans regardless of whether they provide secular social services” and additionally, “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 guidance also states that “the same limitations that apply to all other recipients of these loans” will apply to faith-based organizations. In other words, there are no unique limitations that would apply to religious entities. Churches and church-related organizations not officially recognized with 501(c)(3) status by the IRS will not need to apply for such status in order to be eligible for the PPP and EIDL programs.

Other questions addressed under the FAQ include religious autonomy, the unique application of nondiscrimination rules to religious organizations, clarity around organizational affiliation rules, and more.

Learn more about this guidance and what it means practically for your organization with ECFA’s FREE webinar-on-demand, Navigating Critical Legal Issues in the Covid-19 Crisis.