Tag: Paycheck Protection Program

New Guidance Issued about “Good Faith” Certification Requirement for PPP Loans

In submitting an application for a Paycheck Protection Program (a “PPP Loan”), applicants were required to certify in good-faith that receipt of the PPP Loan was “necessary to support” their “ongoing operations.” The manner in which the Small Business Administration (the “SBA”) will review whether or not such certifications were made in good faith is a topic of ongoing concern among PPP Loan recipients. Yesterday, May 13th, the SBA, in consultation with the U.S. Department of Treasury (“DOT”), indicated that “any borrower that, together with its affiliates, received PPP loans with an original principal amount of less than $2 million will be deemed to have made the required certification” … “in good faith.” The SBA also indicated that, in the event it determines a borrower which received PPP Loans in an amount greater than $2 million did not make the required certification in good faith, it will provide such borrower the opportunity to repay the PPP loan and “will not pursue administrative enforcement or referrals to other agencies based on” such determination if the borrower does repay the PPP Loan.

The attorneys at RJG are regularly monitoring the PPP Loan guidance issued by the SBA and the DOT in order to assist clients in administering their PPP Loans and obtaining available loan forgiveness. Please contact Jim Valentine (jvalentine@rjglaw.com) or Kieran Casey (kcasey@rjglaw.com) if you have questions or require any assistance related to PPP Loan related issues.

If you Received a PPP Loan, Ensure you are Complying with the Applicable Guidance and Regulations

Businesses and non-profit organizations which have received a loan under the Paycheck Protection Program (a “PPP Loan”) must comply with a series of guidance and regulations, including employee retention and compensation maintenance requirements, in order to obtain the loan forgiveness provided by the Program. The attorneys at Rosenn Jenkins & Greenwald are regularly monitoring the PPP Loan guidance and regulations issued by the Small Business Administration and the United States Treasury Department in order to assist clients in administering their PPP Loans and obtaining available loan forgiveness. Please contact Jim Valentine (jvalentine@rjglaw.com) or Kieran Casey (kcasey@rjglaw.com) if you have questions or require any assistance related to PPP Loan forgiveness, or any other issues related to the administration of PPP Loans.

Paycheck Protection Program May be Receiving Additional Funding This Week

Based on the latest news reports, it appears that the popular Paycheck Protection Program (“PPP”) will be replenished with limited additional funding this week. There is already speculation that the new funds, once available, will be depleted in a matter of days. PPP loans are expected to be in even higher demand during this application window as the Small Business Administration (“SBA”) is no longer currently accepting applications for its highly sought-after Economic Injury Disaster Loans. Accordingly, interested business owners should immediately contact their SBA-approved lenders to confirm their eligibility for a PPP Loan and to submit the necessary application and back-up documentation required to obtain such funds.

Addressing the requirements of PPP loans in such a limited timeframe can be overwhelming, but the Business and Finance Department at Rosenn Jenkins & Greenwald LLP is ready to assist business owners through this process. Please contact Paul T. Rushton (prushton@rjglaw.com), Lee S. Piatt (lpiatt@rjglaw.com) or Christyan A. Telech (ctelech@rjglaw.com) to discuss how our team can assist you in these difficult times.

Faith-based Organizations are Eligible to Apply for Relief through CARES Act Programs and Economic Injury Disaster Loans

Faith-based organizations received much-welcomed news on Friday, April 3, when the Small Business Administration (“SBA”) published guidance indicating that it would not enforce regulations that would otherwise prohibit faith-based entities from obtaining SBA loans, including loans through the Paycheck Protection Program and Economic Injury Disaster Loan programs. Accordingly, it is now clear that the Coronavirus Aid, Relief, and Economic Security Act (“CARES”) makes assistance available without regard to whether a nonprofit provides secular services. In this uncertain environment, the attorneys at Rosenn Jenkins & Greenwald LLP are ready to assist your organization in considering and/or applying for the relief available through the CARES programs. Please contact Lee S. Piatt (lpiatt@rjglaw.com) or Christyan A. Telech (ctelech@rjglaw.com) of our Business & Finance Department if you are interested in learning more about these programs and/or our services.

BUSINESSES AFFECTED BY COVID-19 SHOULD GIVE IMMEDIATE CONSIDERATION TO PAYCHECK PROTECTION PROGRAM LOAN

As the COVID-19 virus continues to affect the health of our communities and the operation of the economy, Federal, state and local governmental authorities, as well as certain for-profit and non-profit organizations, have established loan programs and/or other relief efforts to assist eligible businesses that have been adversely affected by the Coronavirus crisis.
 
For example, pursuant to the Coronavirus Aid, Relief, and Economic Security Act (“CARES”), the Federal government has created the Paycheck Protection Program (“PPP”) that is designed to make loans available to small businesses to encourage employee retention and assist employers in meeting ongoing payroll and debt obligations. PPP loans are guaranteed by the Small Business Administration (“SBA”) and made through existing SBA-approved lenders.
 
There are minimal requirements for eligibility for a PPP loan. In general, the borrower must have less than 500 employees and make a good-faith certification that the COVID-19 crisis necessitated the PPP borrowing and that the PPP loan will be used only for specified purposes, including certain interest payments, payroll costs, employee group health care benefits, rent, and utility payments. PPP loans do not require the posting of collateral security and have a maximum rate of interest of 4%. PPP loans are also eligible for full or partial forgiveness.
 
Starting on April 3, 2020, small businesses and sole proprietorships can apply for PPP loans through lenders that have previously offered SBA loans. Beginning on April 10, 2020, independent contractors and self-employed individuals can apply for PPP loans to cover their payroll and other certain expenses through existing SBA lenders. The current end date for PPL loan applications is June 30, 2020.
 
Because it is anticipated that the demand for PPP loans will be high and that the existing funding for the PPP will be insufficient to meet the anticipated PPL loan applications, it is strongly recommended that eligible borrowers submit an application for a PPP loan through a SBA-approved lender promptly following the opening of the window for PPP applications (i.e. on April 3, 2020 for eligible small businesses and sole proprietors and on April 10, 2020 for eligible independent contractors and self-employed individuals).
 
If you are interested in confirming your eligibility for a PPP loan, obtaining assistance with your PPP loan application, identifying a SBA-approved lender and/or learning more about other loan programs and relief assistance, Rosenn, Jenkins & Greenwald, LLP and its Business & Finance Department are available to assist you. Please feel free to contact any of the partners in our Business & Finance Department, including Paul T. Rushton at prushton@rjglaw.com, Steven P. Roth at sroth@rjglaw.com, or Lee S. Piatt at lpiatt@rjglaw.com. We are available to promptly assist you with these very important issues. Stay safe and healthy.