By Steven Campeau
Continuing their efforts to combat the economic impact of COVID-19, Congress has passed, and President Trump has signed into law, additional funding for the Small Business Administration’s (SBA) Payroll Protection Program (PPP). This Program was created from the CARES Act on March 27, but ran out of funds within a month as countless small businesses applied for these relief funds.
Congress has now replenished the PPP with an additional $310 billion, bringing the total authorized aid for this specific program to $659 billion. PPP loans can be as large as $10 million and can be used to cover payroll costs, as well as most mortgage interest, rent, and utility costs over the eight-week period after the loan is made. The loan is forgivable as long as a company maintains payroll, and at least 75% of the funding is used for payroll. For more information on the PPP, please click here.
If you are contemplating on whether you should apply for these funds and are interested in the application, please view this sample application form. Answers to frequently asked questions about the PPP can be found in this recent guidance document issued by the SBA.
Additionally, this new law funds another $60 billion in grants and loans under the SBA’s Economic Injury Disaster Loan Program (EIDL). EIDL’s are up to $2 million and meant to help businesses cover six months of operational expenses. Unlike a PPP loan, which is forgivable, EIDL funds will have to be paid back eventually. However, qualified small businesses have the opportunity for an immediate advance of up to $10,000, which does not have to be repaid. For more information on the EIDL Program, please click here.
NKBA will continue to monitor the situation and provide any pertinent updates.
