Today, the White House announced several reforms to the PPP Program aimed at targeting funds to the smallest businesses and those that have been left behind in previous relief efforts.
The key reforms are as follows:
- 14-Day Exclusivity Period. From February 24 – March 10 only businesses with fewer than 20 employees can apply for PPP.
- Revisions of Loan Calculation Formula. The loan calculation formula for sole proprietors, independent contractors, and self-employed individuals will be revised to offer more relief. Additionally, $1 billion will be set aside for businesses in this category without employees located in low- and moderate-income areas.
- Removal of Restrictions on Eligibility.
- Businesses with at least 20% owned by individuals who have committed a felony within the last year (except for financial-assistance related fraud) are now eligible for PPP, unless the applicant or owner is incarcerated at the time of the application.
- Restrictions on eligibility for businesses with at least 20% owned by individuals who are delinquent on federal student loans will be removed.
- Clarification of Non-Citizen, Lawful U.S Resident Eligibility. The SBA will issue clarifying guidance that holders of Individual Taxpayer Identification Numbers (“ITINs”) may access PPP if otherwise eligible.
The full White House briefing can be found here. SBA guidance on these matters will be forthcoming.
© Polsinelli PC, Polsinelli LLP in California
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