Submitted by Patrick Cassidy
(December 12, 2021) WASHINGTON, DC – Today, Congressman Joe Courtney (CT-02) issued the following statement after the U.S. Department of Treasury and the federal Small Business Administration (SBA) released new guidance for small business owners seeking financial aid and relief amid the COVID-19 pandemic.
The U.S. Small Business Administration, in consultation with the Treasury Department, announced on January 8 that the Paycheck Protection Program (PPP) will re-open the week of January 11 for new borrowers and certain existing PPP borrowers. To promote access to capital, initially only community financial institutions will be able to make First Draw PPP Loans on Monday, January 11, and Second Draw PPP Loans on Wednesday, January 13. The PPP will open to all participating lenders shortly thereafter. 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.
“The Treasury Department and the SBA have both issued guidance for small business owners on how to start applying for new federal resources and funding. If we’re counting on an economic rebound following this pandemic, then we’ve got to do more to help out our small businesses now,” said Rep. Courtney. “This new round of PPP funding was authorized by the recently passed, bipartisan 2021 Consolidated Appropriations Act, and it will put more resources at the disposal of small business owners in eastern Connecticut. I welcome any small business owner in our region with questions on how to apply for this new round of support to call my office.”
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. The new law also provides for First Draw PPPs for certain businesses who did not receive a PPP during the earlier iteration of the program. For more information on these first draw loans, click here.
Key PPP updates include:
- Businesses are now permitted to deduct expenses associated with their forgiven PPP loans, allowing businesses to take advantage of business deductions they take every year but have paid for this year with a PPP;
- 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.
- 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 forauthorized 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
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; andInterim Final Rule on Second Draw PPP Loans