Federal Reserve Board proposes to expand Main Street Lending Program to nonprofit organizations, including hospitals

The Federal Reserve Board yesterday announced it will seek public comments on a proposal to expand its Main Street Lending Program to provide access to credit for nonprofit organizations, including hospitals, a move advocated for by the AHA. The proposed expansion would offer loans to small and medium-sized nonprofits that were in sound financial condition before the COVID-19 pandemic and could benefit from additional liquidity to manage during the current pandemic.

Loan terms under the proposed Main Street nonprofit loans are the same as for Main Street business loans, but borrower eligibility requirements for the proposed nonprofit facilities would be modified to reflect the operational and accounting practices of the nonprofit sector. The minimum loan size is $250,000, and the maximum loan size is $300 million.

In a statement, AHA President and CEO Rick Pollack said, "Hospitals and health systems of all sizes and types of ownership continue to be on the front lines in the battle against this virus. Making these loans also available quickly and on terms that take into account the circumstances of nonprofit hospitals will help eligible hospitals continue to keep their doors open during this crisis and to provide care for their patients and communities into the future."

Comments on the proposal are due June 22.