Local businesses next week will be able to apply for funds under the federal Paycheck Protection Program, which is reopening January 11, according to a posting on the local Small Business Administration website.
The program, according to the announcement, will be open to new borrowers and certain existing PPP borrowers.
The effort, according to the website, was announced jointly by the SBA and Treasury Department “to promote access to capital” and that “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.”
This round of PPP, the announcement said, authorizes $284 billion toward job retention, and “certain other expenses through March 31, 2021.”
Key PPP updates, as listed on the site, include:
- PPP borrowers can set their PPP loan’s covered period from eight and 24 weeks to best meet their business needs.
- 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.
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 percent reduction in gross receipts between comparable quarters in 2019 and 2020.