Changes to the Paycheck Protection Program (PPP)

Please review information regarding changes to the Paycheck Protection Program (PPP) including loan forgiveness as a result of the Paycheck Protection Flexibility Act (enacted June 5, 2020).

The following changes apply regardless of whether your loan was approved prior to June 5, 2020.

  1. There is now a 24-week covered period for spending PPP loan funds. If your loan was approved prior to June 5, 2020 you have the right to choose to remain with an 8-week covered period. You should talk to your financial or legal advisor about the right choice for you.
  2. No payments are due on your PPP note until after a final decision on loan forgiveness has been made from the Small Business Administration (SBA). However, if you do not submit an application for loan forgiveness within 10 months after the end of the covered period (now 24 weeks from loan disbursement), then payments on the PPP note will be due immediately after that deadline has passed.
  3. You can spend 60% of PPP loan proceeds (rather than 75%) on payroll costs and still be eligible for full forgiveness, provided the other 40% is used to pay other eligible costs under PPP (rent, mortgage interest, utilities).
  4. Loan forgiveness will not be reduced if you had full-time employee or wage reductions between February 15, 2020 and April 26, 2020 and you restore full-time employee and wage counts to their February 15, 2020 levels by December 31, 2020.
  5. Loan forgiveness will not be reduced based on an inability to rehire employees if you can document (1) written offers to rehire individuals who were employees on February 15, 2020 who declined; or (2) an inability to hire similarly qualified employees for unfilled positions by December 31, 2020.
  6. Loan forgiveness will not be reduced based on failure to maintain full-time employee levels if you can demonstrate that you could not return to February 15, 2020 business activity levels due to compliance with COVID-19-related guidance for sanitation, social distancing, or worker or customer safety requirements from the Health and Human Services (HHS), the Centers for Disease Control and Prevention (CDC), or the Occupational Safety and Health Administration (OSHA), between March 1, 2020 and December 31, 2020 (including state or local government shutdown orders).