Justin Anthony, Utah Senator Mike Lee’s Business outreach director has clarified some of the changes in the Payroll Protection Program coming out of the second round of CARES funding.
Anthony cited five changes to the new round of funding and they include the following:
Instituting a 14 day period, starting February 24th during which only businesses with fewer than 20 employees can apply for relief through the Program.
Helping sole proprietors, and self-employed individuals receive more financial support.
Creating consistency with a bipartisan bill, eliminating an exclusionary restriction that prevents small business owners with prior non-fraud felony convictions from obtaining relief through the Paycheck Protection Program.
Eliminating an exclusionary restriction that prevents small business owners who are delinquent on their federal student loans from obtaining relief through the Paycheck Protection Program.
Ensuring access for non-citizen small business owners who are lawful U.S. residents by clarifying that they may use Individual Taxpayer Identification Numbers (ITINs) to apply for relief.
The Whitehouse put out a fact sheet on Wednesday February 24th announcing the changes and listing some of the facts about the Payroll Protection Program (PPP). According to that fact sheet funding going to small businesses with fewer than ten employees is up nearly 60 percent.
Rural areas are seeing a marked increase in funding to small businesses. The Whitehouse figures state that rural businesses applying and receiving funding has increased by 30 percent.
Quoting from the Whitehouse fact sheet: “The Biden-Harris administration is announcing several reforms to build on this success by further targeting the PPP to the smallest businesses and those that have been left behind in previous relief efforts. While these efforts are no substitute for passage of the American Rescue Plan, they will extend much needed resources to help small businesses survive, reopen, and rebuild.”
The American Rescue Plan (ARP) is the $1.9 trillion legislative package the new administration is hoping to pass with only Democratic votes. That package includes the much discussed $15/hr minimum wage.
Also in the ARP is legislation aimed at providing more relief to sole proprietors, independent contractors and self employed individuals. These types of businesses, which include home repair contractors, beauticians, and small independent retailers, make up a significant majority of all US businesses.
According to the Whitehouse numbers, these smaller businesses are structurally excluded from the PPP or were approved at much lower levels of relief because of the manner PPP loans are calculated. Some were qualifying for as little as $1.
In an effort to address this problem, the Biden-Harris administration will revise the loan calculation formula for these applicants so that it offers more relief, and establish a $1 billion set aside for businesses in this category without employees located in low- and moderate-income areas.
To find out if you qualify for this round of PPP go to this link. Paycheck Protection Program