December 29, 2020
Hot Topic Tuesday — Dates You Need to Know for PPP 3.0
In addition to allowing particularly impacted businesses to obtain a second draw PPP loan, The Consolidated Appropriations Act of 2021, makes several changes to PPP, EIDL, 7(a), and 504 deadlines.
Here are the dates you should know before PPP 3.0 begins:
- The Consolidated Appropriations Act of 2021 was passed by both the House of Representatives (359-53) and the Senate (92-6) on December 21, 2020. It was then signed by the President on December 27, 2020.
- PPP will last till March 31, 2021
- SBA has 10 days after the bill’s enactment to establish rules and regulations (January 6, 2020).
- The borrower may select a covered period ending at the borrower’s choosing between 8 and 24 weeks after origination.
- The SBA must establish a one-page simplified forgiveness form within 24 days of enactment (January 20, 2020).
- Borrowers are required to retain relevant records related to employment for 4 years and other records for 3 years.
- The SBA must establish a plan detailing their review and forgiveness audit plan within 45 days after enactment of the bill (February 10, 2021)
- A business that was not in operation on February 15, 2020, shall not be eligible for a PPP loan.
- Seasonal employers may calculate their maximum loan amount based on a 12-week period beginning February 15, 2019, through February 15, 2020.
- Farmers and ranchers in operation as of February 15, 2020, may utilize their gross income from 2019 when calculating their maximum loan amount.
- The SBA Administrator must issue guidance addressing barriers to access to capital for underserved communities no later than 10 days after enactment of the bill (January 6, 2020).
- The SBA Administrator must release guidance to lenders within 17 days of enactment of the bill that allows borrowers who returned all or part of their PPP loan to reapply for the maximum amount applicable so long as they have not received forgiveness (January 13, 2021).
- The SBA is required to comply with GAO requests within 15 days (January 11, 2021) and testify to the Senate and House Small Business Committees within 120 days (April 26, 2021) and no less than twice per year for the next two years.
- Government officials and their spouses must disclose the status of their PPP loans within 30 days (January 26, 2021).
- PPP set-asides may be adjusted by the SBA Administrator after the program has been open for 25 days.
- Borrowers with qualifying SBA loans will receive an additional 3 months of principal and interest payments starting in February 2021. After 3 months, underserved borrowers will receive an additional 5 months of payments (not to exceed $9,000 per month).
- Increases the SBA 7(a) loan-guarantee to 90% until October 1, 2021.
- Increases SBA Express Loan amount to $1 million until October 1, 2021.
- The SBA may establish a 504 Express Loan Program to be in effect until September 30, 2023.
- The covered period for EIDL grants has been extended through December 31, 2021, and the time for the SBA to approve EIDL grants has been extended from 3 to 21 days.
For more comprehensive guidance on SBA lending under the new Consolidated Appropriations Act, sign up for Coleman’s Everything Lenders Need to Know about PPP Lending & Forgiveness 3.0 Webinar.