PPP Loan Recipients Information
The SBA has made several announcements about the next phase of the PPP program over the past several days with more details coming out hourly. Below is a summary of what we know at this point in time. Please see the attached document for additional details.
• A revised, streamlined forgiveness process has been include in the legislation for loans under $150,000. The new process is reported to be much easier and require much less from the borrower. The SBA has NOT completed the forms or the procedures for the new process. We expect that this will be addressed once the process and forms for the next round of fundings have been completed. Once the new process has been fully implemented, we will reach out to you to proceed with forgiveness. We are not currently processing forgiveness applications for loans under $150,000 under the old process. Please be patient as we wait for the details for the new program.
Paycheck Protection Program (PPP) will re-open the week of January 11th for new borrowers and certain existing PPP borrowers.
• Program opened on January 11th to certain institutions (CDIF’s and MDI’s), and shortly thereafter for others. We are not in the first wave of financial institutions eligible to submit applications as of today. At this point in time, we have not been notified by SBA as to when exactly we will be able to submit Round 2 applications.
• While we are not sure of when we can submit applications to the SBA, we can start accepting completed applications from you, the borrower, so we are prepared once the system is open to us.
• We are targeting accepting applications by the end of this week.
• Below, please find a summary for a First Draw Application, a Second Draw Application along with the corresponding Application form. You can begin to prepare your application form as corresponding documentation.
• Program ends March 31st.
Key PPP updates include:
• PPP borrowers can set their PPP loan’s covered period to be any length between 8 and 24 weeks to best meet their business needs;
• PPP loans will cover additional expenses, including operations expenditures, property damage costs, supplier costs, and worker protection expenditures;
• The Program’s eligibility is expanded to include 501(c)(6)s, housing cooperatives, destination marketing organizations, among other types of organizations;
• The PPP provides greater flexibility for seasonal employees;
• Certain existing PPP borrowers can request to modify their First Draw PPP Loan amount;
• Certain existing PPP borrowers are now eligible to apply for a Second Draw PPP Loan.
• Applications, rules and required documentation requirements are expected to be released prior to Monday.
A borrower is generally eligible for a Second Draw PPP Loan if the borrower:
• Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses;
• Has no more than 300 employees; and
• Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020. There is some flexibility to expand this to year-over-year – see SBA Guidance for more details.
Links to Applications and Instructions:
• PPP Overview of First Draw
• PPP First Draw Borrower Application Form
• PPP Overview of Second Draw
• PPP Second Draw Borrower Application Form
The new guidance released includes:
• PPP Guidance from SBA Administrator Carranza on Accessing Capital for Minority, Underserved, Veteran, and Women-owned Business Concerns;
• Interim Final Rule on Paycheck Protection Program as Amended by Economic Aid Act; and
• Interim Final Rule on Second Draw PPP Loans
For more information on SBA’s assistance to small businesses, visit the SBA website or the Treasury website.