Press release content from Globe Newswire. The AP news staff was not involved in its creation.
The SBA Takes Steps to Improve First Draw Paycheck Protection Program Loan Review
United States Small Business AdministrationJanuary 26, 2021 GMT
Washington, Jan. 26, 2021 (GLOBE NEWSWIRE) The U.S. Small Business Administration is taking steps to improve the First Draw Paycheck Protection Program loan review so that small businesses have as much time as possible to access much needed PPP funds. The Biden-Harris Administration is focused on ensuring small businesses receive the support they need to keep their doors open and continue to employ millions of Americans across the country. The Administration is working with the Agency to identify immediate solutions to address eligibility, compliance, integrity, and promote transparency.
SBA and Treasury re-open PPP and issue new guidance Blog
SBA and Treasury re-open PPP and issue new guidance
The most recently enacted coronavirus relief package, the Consolidated Appropriations Act of 2021, included an additional $284 billion for the Paycheck Protection Program (PPP) available through March 31, 2021. In addition to providing more funding, the legislation also made certain changes to the program that include expanding authorized uses of funds and increasing loan forgiveness flexibility. Of note, the legislation permits borrowers who have already received a PPP loan to apply for a second draw.
The PPP, first established in the Coronavirus Aid, Relief, and Economic Security (CARES) Act, is a loan initiative aimed at helping small businesses weather the economic fallout from the COIVD-19 pandemic and is important to counties’ ability to support the economic well-being of their residents and communities.
A: Borrowers are eligible for a second-draw PPP loan of up to $2 million, provided they have:
300 or fewer employees.
Used or will use the full amount of their first PPP loan on or before the expected date for the second PPP loan to be disbursed to the borrower. The IFR also clarifies that the borrower must have spent the full amount of the first PPP loan on eligible expenses.
Experienced a revenue reduction of 25% or more in all or part of 2020 compared with all or part of 2019. This is calculated by comparing gross receipts in any 2020 quarter with an applicable quarter in 2019, or, in a provision added in the IFR, a borrower that was in operation for all four quarters of 2019 can submit copies of its annual tax forms that show a reduction in annual receipts of 25% or greater in 2020 compared with 2019.
On January 12, 2021, the Eastern District of California settled the first False Claims Act (“FCA”) case based on Paycheck Protection Program ("PPP")-related fraud. SlideBelts Inc. – a.