Congress Approves Additional Funding for Paycheck Protection Program and the SBA Clarifies Loan Availability for Large Companies

Two recent important developments took place in connection with COVID-19 related small business funding opportunities.

ADDITIONAL FUNDING

The $484 billion Paycheck Protection Program and Health Enhancement Act was approved by the Senate and passed by the U.S. House of Representatives yesterday.  President Trump is expected to sign the new legislation today.

Most of the small business funding, $321 billion, will replenish the Paycheck Protection Program (PPP).  Of the $321 billion, $60 billion is designated to be available through small business lenders, including Insured Depository Institutions and Credit Unions.  Here is the approximate breakdown of the remainder of the package and allocation of the funds:

  • $75 billion for hospitals and healthcare providers
  • $50 billion to the Small Business Administration’s Economic Injury Disaster Loan Program
  • $25 billion for expanding COVID-19 testing
  • $10 billion for Emergency Economic Injury Disaster

SBA CLARIFICATION

On April 23, The Treasury Department and the Small Business Administration (SBA) updated their FAQ document, adding an item (Question 31) addressing whether businesses owned by large companies with adequate sources of liquidity to support the business’s ongoing operations qualify for a PPP loan. Here is the link to the updated FAQs https://home.treasury.gov/system/files/136/Paycheck-Protection-Program-Frequently-Asked-Questions.pdf