The U.S. Small Business Administration (SBA) released updated guidance for businesses that received Paycheck Protection Program (PPP) loans of $150,000 or less and have not yet applied for forgiveness for their first or second draw PPP loans. According to the SBA, loans of $150,000 or less represent 93% of the outstanding PPP loans. Once the changes have been implemented, the program will:
- Allow lenders to use a COVID Revenue Reduction Score at the time of forgiveness to document the required revenue reduction for second draw PPP loans. To qualify for a second draw PPP loan, the borrower must have experienced a revenue reduction of not less than 25% in at least one quarter of 2020 compared to the same quarter in 2019.
- Launch a streamlined application portal to allow borrowers with PPP loans of $150,000 or less through participating lenders (who have opted in) to apply for forgiveness directly through the SBA. The new platform is slated to begin accepting applications from borrowers on August 4th, 2021.
For businesses that received PPP funds, but did not qualify for forgiveness, the guidance allows for an extension of the loan deferment period for those PPP loans where the borrower files a timely appeal of a final SBA loan review decision with the SBA Office of Hearings and Appeals.
The Brewers Association estimates that 80% of small and independent breweries applied for first draw PPP Loans.
Breweries and other small businesses can directly contact the SBA’s PPP customer service team who will answer questions and directly assist borrowers with their forgiveness applications. Borrowers that need assistance should call (877) 552-2692, Monday – Friday, 8 a.m. – 8 p.m. EST.