Paycheck Protection Program Resumes April 27, 2020

Paycheck Protection Program Resumes April 27, 2020
Posted on 04/25/2020

The U.S. Small Business Administration (SBA) will begin receiving applications from participating lenders at 7:30 a.m., Monday, April 27 for the Paycheck Protection Program (PPP), which was part of the relief package and part of the original Coronavirus Aid, Relief, and Economic Security (CARES) Act. With the additional funding of $310 billion, the SBA will resume processing applications that are already in the queue on a first-come, first-served basis.

President Donald Trump signed a $484 billion coronavirus relief package Friday, April 24, paving the way for small businesses, hospitals and various government entities to receive funds for staff retention, research, equipment manufacturing and testing.

The initial round of the PPP program allocated $349 billion through the SBA. Some large businesses such as restaurant chains received PPP funds and have been the target of criticism. The program ran out of money after a blizzard of applications by businesses across the country. A backlog of one million applications from small businesses that have already applied. The new program ensures that $60 billion is set aside for smaller lenders so that disadvantaged businesses are not left out.

The PPP program allowed small businesses to apply for 100 percent federally-guaranteed loans to employers who maintain their payrolls during the current health crisis. If employers maintain their payroll, the loans would be forgiven. PPP featured forgiveness of up to eight weeks of payroll based on employee retention and salary levels, no SBA fees, and at least six months of deferral with maximum deferrals of up to a year.

Out of the total $484 billion under the new legislation, $10 billion will be earmarked for economic injury disasters. Hospitals and health care providers would receive $75 billion for expenses related to coronavirus and compensation for lost revenue. In addition, $25 billion would go to expanded coronavirus testing, $11 billion would be sent to various states, local governments, territories and tribal governments and nearly $4 billion would be earmarked for research.

Funds again will be administered by the SBA. A list of participating lenders is on the SBA’s website, https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protection-program