A new COVID-19 relief package with a second round of Paycheck Protection Program (PPP) funds has been approved by Congress as part of the Consolidated Appropriations Act, 2021. PPP funds will be made available through Community Financial Institutions beginning January 11th. Applications will be accepted through community lenders -- First National Bank Alaska and Wells Fargo -- by mid/late January. Fill out this form which can be used to apply with an eligible lender: PPP application.
To assist small businesses concerned about making the next payments or having to close their doors altogether, $284 billion have been appropriated for the PPP fund. First-time borrowers; businesses with 500 or fewer employees, 501(c)(3) nonprofits, independent contractors, sole proprietors, and self-employed individuals are eligible. If past borrowers have used all of their first loan (or will have by the time of the disbursement of the second loans) they may be eligible for a second loan. This round of funds widens the eligibility criteria for borrowers that need a second draw of loans (PPP2) to include:
Businesses with 300 or fewer employees, or businesses that have had at least a 25% drop in gross revenues between the same quarters of 2019 and 2020;
Borrowers in bankruptcy (see program guidelines for more detail);
501(c)(6) not-for-profits; and
Religious organizations (e.g., churches, mosques, synagogues).
The legislation expanded the types of expenses for which PPP loans may be used such as operations expenditures, property damage costs, supplier costs, and worker protection expenditures.
The Small Business Administration provides loan forgiveness if certain employee retention criteria are met, more details on PPP loan forgiveness can be found here. Paycheck Protection Program is designed as an incentive for small businesses to keep employees on the payroll (businesses must spend 60% or more on payroll to be eligible for full forgiveness). Additional loan information includes: PPP loans have an interest rate of 1%, no collateral or personal guarantees are required, neither the government nor lenders will charge small businesses any fees, and loan payments will be deferred for borrowers who apply for loan forgiveness until SBA remits the borrower's loan forgiveness amount to the lender. If a borrower does not apply for loan forgiveness, payments are deferred 10 months after the end of the covered period for the borrower’s loan forgiveness (either 8 weeks or 24 weeks).
Specific information can be found regarding appropriations and additional PPP and EIDL loan information through this powerpoint provided by the SBA.
For more information regarding business guidance and other loan resources visit the SBA's pages.