COVID-19 Resources

Updated PPP guidance outlining Program changes to enhance its effectiveness and accessibility was released on January 6 in accordance with the Economic Aid to Hard-Hit Small Businesses, Non-Profits, and Venues Act.

This round of the PPP continues to prioritize millions of Americans employed by small businesses by authorizing up to $284 billion toward job retention and certain other expenses through March 31, 2021, and by allowing certain existing PPP borrowers to apply for a Second Draw PPP Loan.

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, direct 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; and
• Certain existing PPP borrowers are now eligible to apply for a Second Draw PPP Loan.

Lenders with $1 Billion or Less in Assets Will be Able to Submit First and Second Draw PPP Applications on Friday – Continuing Dedicated Access for Community-Based Lenders

The U.S. Small Business Administration, in consultation with the U.S. Treasury Department, will re-open the Paycheck Protection Program (PPP) loan portal to PPP-eligible lenders with $1 billion or less in assets for First and Second Draw applications on Friday, January 15, 2021 at 9 am ET.  The portal will fully open on Tuesday, January 19, 2021 to all participating PPP lenders to submit First and Second Draw loan applications to SBA.

PPP Second Draw Loans

1/14/21 – The Paycheck Protection Program (PPP) now allows certain eligible borrowers that previously received a PPP loan to apply for a Second Draw PPP Loan with the same general loan terms as their First Draw PPP Loan. Second Draw PPP Loans can be used to help fund payroll costs, including benefits. Funds can also be used to pay for mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.

Second Draw PPP Loans made to eligible borrowers qualify for full loan forgiveness if during the 8- to 24-week covered period following loan disbursement:

• Employee and compensation levels are maintained in the same manner as required for the First Draw PPP loan;
• The loan proceeds are spent on payroll costs and other eligible expenses; and
• At least 60 percent of the proceeds are spent on payroll costs.

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.
Maximum Loan Amount and Increased Assistance for Accommodation and Food Services Businesses

For most borrowers, the maximum loan amount of a Second Draw PPP Loan is 2.5x average monthly 2019 or 2020 payroll costs up to $2 million. For borrowers in the Accommodation and Food Services sector (click HERE for NAICS 72 to confirm), the maximum loan amount for a Second Draw PPP Loan is 3.5x average monthly 2019 or 2020 payroll costs up to $2 million.

How and When to Apply
Borrowers can apply for a Second Draw PPP Loan until March 31, 2021, through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, eligible non-bank lender, or Farm Credit System institution that is participating in PPP. All Second Draw PPP Loans will have the same terms regardless of lender or borrower. A list of participating lenders as well as additional information and full terms can be found HERE.

Ensuring Access for All SBA continues to call upon its lending partners, including Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs), to redouble their efforts to assist eligible borrowers in underserved and disadvantaged communities. At least $25 billion is being set aside for Second Draw PPP Loans to eligible borrowers with a maximum of 10 employees or for loans of $250,000 or less to eligible borrowers in low- or moderate-income neighborhoods. To promote access for smaller lenders and their customers, SBA will initially only accept Second Draw PPP Loan applications from community financial institutions starting on January 13, 2021. The PPP will open to all participating lenders for Second Draw PPP Loans shortly thereafter.

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
• Interim Final Rule on Second Draw PPP Loans

Visit www.sba.gov or www.treasury.gov for more information and details, including the comprehensive program rules.

SBA and Treasury Announce New EZ and Revised Full Forgiveness Applications for the Paycheck Protection Program

Today, Wednesday June 17, the U.S. Small Business Administration, in consultation with the U.S. Department of the Treasury, posted a revised, user-friendly Paycheck Protection Program loan forgiveness application implementing the PPP Flexibility Act of 2020. In addition to revising the full forgiveness application, the SBA also published a new “EZ” version of the forgiveness application applying to borrowers who:

• Are self-employed and have no employees; OR
• Did not reduce the salaries or wages of their employees by more than 25%, and did not reduce the number or hours of their employees; OR
• Experienced reductions in business activity as a result of health directives related to COVID-19 and did not reduce the salaries or wages of their employees by more than 25%

Details regarding the applicability of these provisions are available in the instructions to the new EZ application form. Both applications give borrowers the option of using the original 8-week covered period (if their loan was made before June 5, 2020) or an extended 24-week covered period. These changes will result in a more efficient process and make it easier for businesses to realize full forgiveness of their PPP loan.

• Click here to view the EZ Forgiveness Application.
• Click here to view the Full Forgiveness Application.

Program Overview

The Paycheck Protection Program is a loan designed to help small businesses stay open and provide a direct incentive for small businesses to keep their workers on the payroll.

SBA will forgive portions of loans if all employees are kept on the payroll for 8 or 24 weeks and the money is used for payroll, rent, mortgage interest, or utilities.

The Paycheck Protection Program will be available through August 8, 2020.

Who Can Apply

This program is for any small business with less than 500 employees (including sole proprietorships, independent contractors and self-employed persons), private non-profit organization or 501(c)(19) veterans organizations affected by coronavirus/COVID-19.

Businesses in certain industries may have more than 500 employees if they meet the SBA’s size standards for those industries. Small businesses in the hospitality and food industry with more than one location could also be eligible at the store and location level if the store employs less than 500 workers. This means each store location could be eligible.

Eligible Businesses

  – A small business with fewer than 500 employees

  – A small business that otherwise meets the SBA’s size standard

  – A 501(c)(3) not-for-profit charitable organization with fewer than 500 employees

  – An individual who operates as a sole proprietor

  – An individual who operates as an independent contractor

  – An individual who is self-employed who regularly carries on any trade or business

  – A Tribal business concern that meets the SBA size standard

  – A 501(c) (19) Veterans Organization that meets the SBA size standard

  – If you are in the accommodation and food services sector (NAICS 72), the 500-employee rule is applied on a per physical location basis

– If you are operating as a franchise or receive financial assistance from an approved Small Business Investment Company, the normal affiliation rules do not apply

Ineligible Businesses

 – Businesses engaged in illegal activity under federal, state or local law. (Cannabis warning)

 – A household employer (e.g. if you have a nanny, staff, etc.)

– Any previous defaults on a federal loan in last 7 years

The PPP Flexibility Act of 2020, which included language championed by the bill Senator Manchin introduced, was passed by Congress earlier this month. The bill makes the following changes to the PPP program:

• Extends the period to use a PPP loan from 8 weeks to 24 weeks (or until Dec 31 if the 24 weeks would go beyond Dec 31, 2020)
• The bill reduces the amount of PPP proceeds that must be spent on payroll costs from 75 percent to 60 percent
• The bill increases the repayment period for PPP loans issued after enactment from 2 years to 5 years (for the portion not forgiven).   Lenders and small businesses with PPP loans issued already would be allowed to modify to a 5 year repayment period if both agree, but they are not required to.
• The bill allows businesses that receive loan forgiveness from PPP to also defer their 2020 payroll tax and pay half in 2021 and half in 2022.
• The bill extends the rehiring date from June 30 to Dec. 31 for the purposes of having individuals back on payroll for loan forgiveness.
• Any business that qualifies for loan forgiveness based on the 8 week period in the original CARES Act can elect to keep that covered period so that they do not lose forgiveness because of the date change in this new bill.
• The bill creates a new exemption that allows businesses to obtain full loan forgiveness even if they don’t rehire all their workers by Dec 31 if they show an inability to rehire their employees or similarly qualified employees by the Dec 31 deadline.
• The bill creates another new exemption that allows businesses to obtain full loan forgiveness even if they don’t rehire all workers by Dec 31 if they show that the reason is due to state or local health restrictions.  (For example, a restaurant that is only allow to use 50 percent of its capacity under a state health order could rehire 50 percent of its employees and still get full loan forgiveness)
• The bill extends the deferment period for delaying repayment of a PPP loan that is not forgiven from 6 months to 1 year.

This FAQ sheet from treasury.gov could be a lifesaver, it’s packed full of frequently asked questions and answers!

One of our main takeaways, DOCUMENTATION IS KEY FOR LOAN FORGIVENESS!

Example – Question #40 – Will a borrower’s PPP loan forgiveness amount (pursuant to section 1106 of the CARES Act and SBA’s implementing rules and guidance) be reduced if the borrower laid off an employee, offered to rehire the same employee, but the employee declined the offer?

Answer: No. As an exercise of the Administrator’s and the Secretary’s authority under Section 1106(d)(6) of the CARES Act to prescribe regulations granting de minimis exemptions from the Act’s limits on loan forgiveness, SBA and Treasury intend to issue an interim final rule excluding laid-off employees whom the borrower offered to rehire (for the same salary/wages and same number of hours) from the CARES Act’s loan forgiveness reduction calculation. The interim final rule will specify that, to qualify for this exception, the borrower must have made a good faith, written offer of rehire, and the employee’s rejection of that offer must be documented by the borrower. Employees and employers should be aware that employees who reject offers of re-employment may forfeit eligibility for continued unemployment compensation.

View the FAQ sheet here:
https://home.treasury.gov/system/files/136/Paycheck-Protection-Program-Frequently-Asked-Questions.pdf

If you are interested in applying for the Paycheck Protection Program, please contact your financial institution to see if they are an SBA lender, or would like to become one. A list of SBA lenders in West Virginia can be found starting on page 27 in the resource guide. 

Resource Guide

PPP Interim Final Rule

PPP Fact Sheet

PPP Overview

PPP Borrower Application  

Find Eligible Lenders

PDF List WV SBA Lenders

PPP Lender Fact Sheet

PPP Frequently Asked Questions_5.13.20

PPP Flexibility Act Manchin

US Chamber of Commerce PPP Forgiveness Guide

SBA Faith Based FAQ

WVDA COVID-19 Pandemic Resources for Farmers and Food Producers

Pandemic Unemployment Assistance (PUA) FAQ Sheet for Self-employed Individuals

Click here to find an SBDC Coach near you!

FAQ’s Small Business Grant_7.15.2020

PPP Forgiveness Application 3508EZ ( Revised 06.16.2020)

PPP Loan Forgiveness Application (Revised 6.16.2020)

PPP Forgiveness Application Creator 

You may also contact SBA’s Disaster Assistance Center at  800-659-2955 or via email at disastercustomerservice@sba.gov, if you have a question regarding your EIDL application.

If you have inquiries about the EIDL process please visit https://disasterloan.sba.gov/ela/

U.S. Small Business Administration Administrator Jovita Carranza announced today (5/4) that agricultural businesses are now eligible for SBA’s Economic Injury Disaster Loan (EIDL) and EIDL Advance programs. SBA’s EIDL portal will reopen today (5/4) as a result of funding authorized by Congress through the Paycheck Protection Program and Healthcare Enhancement Act. The legislation, signed into law by the President one week ago, provided additional funding for farmers and ranchers and certain other agricultural businesses affected by the Coronavirus (COVID-19) pandemic.

The U.S. Small Business Administration announced earlier this week that working capital disaster loans are now available to small businesses, small agricultural cooperatives, small businesses engaged in aquaculture and private nonprofit organizations located in Wood County, West Virginia as a result of excessive rain and cold temperatures on April 23 through June 5, 2020. 

Under this declaration, the SBA’s Economic Injury Disaster Loan program is available to eligible farmrelated and nonfarm-related entities that suffered financial losses as a direct result of this disaster. With the exception of aquaculture enterprises, SBA cannot provide disaster loans to agricultural producers, farmers and ranchers. 

The loan amount can be up to $2 million with interest rates of 3.75 percent for small businesses and 2.75 percent for private nonprofit organizations of all sizes, with terms up to 30 years. 

These working capital loans may be used to pay fixed debts, payroll, accounts payable, and other bills that could have been paid had the disaster not occurred. The loans are not intended to replace lost sales or profits. 

Applicants may apply online using the Electronic Loan Application (ELA) via SBA’s secure website at DisasterLoan.sba.gov and should apply under SBA declaration # 16637, not for the COVID-19 incident. 

Disaster loan information and application forms may also be obtained by calling the SBA’s Customer Service Center at 800-659-2955 (800-877-8339 for the deaf and hard-of-hearing) or by sending an email to DisasterCustomerService@sba.gov. 

Loan applications can be downloaded from www.sba.gov. Completed applications should be mailed to: U.S. Small Business Administration, Processing and Disbursement Center, 14925 Kingsport Road, Fort Worth, TX 76155. Submit completed loan applications to SBA no later than April 28, 2021.

EFFECTIVE: January 8, 2021 – Section 1110(e)(6) of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) required SBA to deduct the amount of any Economic Injury Disaster Loan (EIDL) Advance received by a PPP borrower from the PPP forgiveness payment remitted by SBA to the PPP lender. On October 2, 2020, SBA began remitting forgiveness payments to PPP lenders, with the required EIDL Advance deductions. On December 27, 2020, the President signed the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act (Economic Aid Act), which repealed Section 1110(e)(6) of the CARES Act.1

In order to implement the repeal, the Forgiveness Platform has been updated and, effective immediately, SBA will no longer deduct EIDL Advances from forgiveness payments remitted to PPP lenders. This change will be applied to SBA forgiveness payments with a status of “Payment Confirmed” dated December 29, 2020 or later.

For those loans where SBA remitted a forgiveness payment to a PPP lender that was reduced by an EIDL Advance, SBA will automatically remit a reconciliation payment to the PPP lender for the previously-deducted EIDL Advance amount, plus interest through the remittance date. PPP lenders are not required to request remittance of the reconciliation payment.

SBA will identify forgiveness payments that were reduced by EIDL Advances and automatically remit a reconciliation payment to the ACH account identified by the PPP lender in the Forgiveness Platform. Upon confirmation that the payment has been accepted by the PPP lender, SBA will generate a Notice of Paycheck Protection Program Reconciliation Payment that will be available in the Forgiveness Platform.

The PPP lender is responsible for notifying the borrower of the reconciliation payment. The PPP lender is also responsible for re-amortizing the loan and notifying the borrower of the amount of the next payment due, or advising the borrower that the loan has been paid in full, whichever is applicable. If the amount remitted by SBA to the PPP lender exceeds the remaining principal balance of the PPP loan (because the borrower made a payment on the loan), the PPP lender must remit the excess amount, including accrued interest paid by the borrower, to the borrower.

Questions concerning this Notice may be directed to the Lender Relations Specialist in the local
SBA Field Office. Local SBA Field Offices can be found at https://www.sba.gov/tools/localassistance/districtoffices