Second Round of PPP Loans Live
On January 11, the Paycheck Protection Program (PPP) reopened to provide a second round of funding for businesses hit hard by the pandemic (PPP2). The $900 billion COVID-19 relief bill passed in December included $284 billion in allocations for PPP2, which is available through March 31, 2021 (unless funds are depleted sooner).
New and existing PPP borrowers may apply, as long as they have fewer than 300 employees, were in business on or before Feb. 15, 2020, and can show a 25% decline in gross income for any quarter in 2020 compared to the same quarter in 2019.
Additional PPP2 Highlights:
Eligibility: Eligibility was expanded to include additional types of businesses, such as 501(c)(6) organizations, housing cooperatives, and direct marketing organizations
- Corporations, sole proprietorships, LLCs, self-employed still qualify
- Borrowers who received the previous PPP1 funds must have used the full amount of PPP1 for authorized uses
Amount: PPP loans will be generally 2.5 times the average monthly payroll, subject to a maximum of $2,000,000.
- Tourism and Food Services sectors (businesses with a NAICS code beginning with 72) will receive 3.5 times the average monthly payroll
Uses: In addition to payroll, PPP funds can be used for rent, utilities, operations expenditures, property damage costs, supplier costs, and worker protection and health and safety expenditures
- Employees are both part-time and full-time employees and can also be agency staff you employ.
Covered Period: Between 8 and 24 weeks
PPP2 opened with a new tiered system to ensure early access for first-time borrowers and minority-owned small businesses. Smaller community financial institutions gained access to the Small Business Administration’s (SBA) lending portal before larger banks. During PPP1, Arizona companies received more than 85,000 loans worth more than $8.6 billion.
To apply for PPP2, fill out the application form on sba.gov/ppp and submit it to an eligible lender. You can find approved Arizona financial institutions here: Arizona lenders.
Get the most up-to-date PPP guidance from the Small Business Administration’s website.