Paycheck Protection Program reopening next week, providing further assistance to small businesses
WICHITA, Kan. (KWCH) - The U.S. Small Business Administration (SBA), with the Treasury Department, announced on Friday (Jan. 8) that the Payment Protection Program (PPP) will reopen next week “for new borrowers and certain existing new borrowers.”
This next round of the PPP continues to prioritize millions of Americans employed by small businesses, the SBA said. This time, the program will authorize up to $284 billion toward job retention “and certain other expenses” through March 31 and by allowing some existing PPP borrowers to apply for a Second Draw PPP loan.
“The historically successful Paycheck Protection Program served as an economic lifeline to millions of small businesses and their employees when they needed it most,” said Administrator Jovita Carranza. “Today’s guidance builds on the success of the program and adapts to the changing needs of small business owners by providing targeted relief and a simpler forgiveness process to ensure their path to recovery.”
Treasury Secretary Steve Mnuchin said the PPP “has successfully provided $525 billion to America’s small businesses, supporting more than 51 million jobs.”
“This updated guidance enhances the PPP’s targeted relief to small businesses most impacted by COVID-19,” Secretary Mnuchin said. “We are committed to implementing this round of PPP quickly to continue supporting American small businesses and their workers.”
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; and
- Certain existing PPP borrowers are now eligible to apply for a Second Draw PPP Loan.
The SBA said a borrower is generally elibile for a Second Draw PPP Loan if that borrower previously redceived a First Draw PPP Loan wndwill or has ussed the full amount only for authroized uses, has more than 300 employees, and can demonstrate that at least a 25 percet reductionin gross receipts between comparable quarters in 2019 and2020.
You can find more information on SBA’s assistance to small businesses on its website.
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