On April 24, the President signed the Paycheck Protection Program and Health Care Enhancement Act, providing $310 billion in additional funding for the Paycheck Protection Program (PPP), $10 billion for the Economic Injury Disaster Loan program (EIDL), as well as funding for other critical healthcare needs.
For many, the availability of the initial PPP funds has created a challenge. On April 16, the SBA announced that the PPP and the EIDL programs had run out of money, before many in need had access to the funds. As a result, these new funds will be targeted towards different recipients by targeted allocation of funds to borrowers.
Things to note:
Of the $310 billion:
- Not less than $30 billion is targeted for financial institutions with between $10 billion and $50 billion in assets.
- Not less than $30 billion is targeted for financial institutions with under $10 billion in assets.
The Act also includes:
- $50 billion for funding for the SBA’s “Disaster Loans Program Account” for the cost of direct loans authorized by Section 7(b) of the Small Business Act.
- $75 billion administered by the Department of Health and Human Services to eligible healthcare providers for unreimbursed costs incurred in relation to COVID-19 related issues.
- $25 billion for manufacturing and purchasing COVID-19 tests.
- The opportunity for farmers and ranchers, who were previously eligible for PPP loans but not EIDL, to apply for EIDL.
In addition, U.S. Treasury Secretary Mnuchin announced that the Treasury will issue “clear guidance” on the good faith certification borrowers are asked to make in their application.
How to Apply for the PPP or EIDL
We encourage you to apply for either program as soon as possible. The SBA is expected to be able to process loans under the new Act in a matter of days. Eligibility parameters for the PPP and EIDL remain the same from the initial round of funding (aside from the addition of farmers and ranchers eligibility for EIDL funds). You can access all of the application links in our Business Owners Toolkit.
Sweeney Conrad is here to help with the application process.