What you need to know.
I already got one PPP Loan, can I get another one?
Yes! These are called “second draw” loans, and as long as you meet the qualifications below, you can apply. The deadline for all new loans is March 31 but money is expected to run out by then. It is critical to apply as soon as possible.
Who Qualifies?
• Your income – gross receipts – must have declined by 25% or more in any quarter of 2020 compared to 2019. It appears that this loss will need to be measured by quarters, not just a three-month period. Gross receipts are likely to exclude funds from PPP loans or other loans or grants.
• You must have been in business prior to Feb. 15, 2020.
• You must have used, or will use, all of your previous PPP loan if you received one.
• You must have fewer than 300 employees.
• Qualified businesses can be corporations, LLCs, sole proprietors, self-employed, independent contractors.
• No loan can be greater than $2 million.
How Much Can I Get?
• Most businesses: As in the first round of PPP, you can get up to your average monthly payroll in 2019 times 2.5. In other words, if your total 2019 monthly payroll cost averaged $10,000, you can apply for $25,000. Keep in mind that “payroll” expenses include all costs for W-2 employees (not independent contractors), including wages, commissions, bonuses, health insurance, retirement, state and local taxes.
• Accommodation and food service businesses (hotels and restaurants): Recognizing how hard hit these industries have been, Congress upped the amount to 3.5 times average 2019 monthly payroll costs. In other words, if your restaurant’s 2019 monthly payroll averaged $10,000, you can now apply for $35,000.
Where & When to Apply
The legislation was signed into law Sunday night but there is at least a 10-day waiting period as lenders figure out how to process applications and wait for the money to arrive from the SBA. However, it is critical to start preparing now so you can apply as soon as it opens up.
Many lenders are still deciding if they will process the second round PPP applications. Here are a few who have confirmed they will.
• Lendio
• Cross River Bank
Stay tuned, more are coming! Visit our site for the most up to date info.
What You Should Be Doing Immediately
Act fast. What small businesses learned the last round of PPP funding was that if you snooze, you lose. You should be prepared to apply for everything the very first day it becomes available.
1. Figure out your income by quarters this year versus 2019. You’re going to have to certify at least a 25% drop in gross revenues.
2. Contact potential lenders. Contact local banks, community lending institutions, credit unions. Ask whether they’re going to participate in the next round of PPP lending. Find a couple lending sources, even if you received a PPP loan before.
3. Try to connect with an individual lending officer. You’ll have a better chance of getting a PPP loan if you have a relationship with a person.
4. Pay attention. Keep a close out eye for application openings and deadlines. Apply DAY ONE for everything you even potentially qualify for.
Accessing the second round $10,000 EIDL Grant
These are called “Targeted EIDL Grants” in the legislation and if you have a small business under 300 employees or a side-hustle with 1099 income (as opposed to W2 income), you’d qualify if:
1. You are in a low-income community (What’s a low-income community? See below.)
2. Your gross revenue over an 8 week period between 2019 and 2020 has declined by 25%. This should be the same 8 week period in each year.
LEARN MORE about the EIDL Grant/Loan
Other Funds Available for Venues, Theaters, and Museums
Other Funds Available for Venues, Theaters, and Museums
Concert venues, theaters, and museums are not eligible for new Paycheck Protection Program loans, but can apply for special “Shuttered Venue Operator Grants” worth up to $10 million. Venues will be able to begin applying for the funds in the coming days with priority given to venues that faced 70–90% revenue losses in 2020.
LEARN MORE about the Venue Grant
Other Funds Available for Farmers and Ranchers
Part of the new stimulus package includes specific relief for farmers and ranchers. These include funding for food assistance programs, enhancements to the Paycheck Protection Program and funding for enhanced broadband access, as well as additional financial resources for agricultural research and farmer stress assistance programs, among others.
LEARN MORE about Farmers and Ranchers Stimulus
Things are changing and moving quickly, follow our website for the most up to date info!
Provided by the Northern Utah Economic Development Alliance in partnership with Weber County Government