WASHINGTON, D.C. (WWTI) — The U.S. Small Business Administration (SBA) has announced that the Paycheck Protection Program (PPP) will reopen next week for both new and certain existing New York State borrowers.
Following consultation with the U.S. Treasury Department, the SBA announced on Friday that the PPP will reopen the week of January 11, and the upcoming round will designate $284 billion for job retention and other expenses through March 31.
According to the SBA, initially, only community financial institutions will be able to make First Draw PPP loans on January 11 and Second Draw PPP loans on January 13. SBA says it will be open to all participating lenders shortly thereafter.
Generally, to be eligible, borrowers can either have previously received a First Draw PPP Loan and will or have used the fill amount, have under 301 employees, and demonstrate at minimum 25% reduction in gross receipts between 2019 and 2020.
Additionally, updated PPP guidance was released on January 6 in accordance with the Economic Aid to Hard-Hit Small Businesses, Non-Profits and Venues Act.
Small Business Administrator Jovita Carranza commented on the upcoming round of the Program. “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 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.”
The SBA shared key updates of the Paycheck Protection Program. These include:
- PPP loan coverage period can extend from eight to 24; set by PPP borrowers
- Loans will cover additional expenses including operations expenditures, property damage costs, supplier costs and worker protection expenditures
- Eligibility for the program expanded to include 501(c)(6)s, housing cooperatives, direct marketing organizations
- The PPP provides greater flexibility for seasonal employees
- Certain existing PPP borrowers can request to modify their First Draw PPP Loan amount
- Certain existing PPP borrowers are now eligible to apply for a Second Draw PPP Loan
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