On February 22, 2021, the Biden-Harris Administration and the Small Business Administration (“SBA”) announced the taking of certain steps with the Paycheck Protection Program (“PPP”) to further promote equitable relief for smaller businesses.
Steps: The SBA will:
- Establish a 14-day, exclusive PPP loan application period for businesses and nonprofits with fewer than 20 employees;
- Allow sole proprietors, independent contractors, and self-employed individuals to receive more financial support by revising the PPP’s funding formula for these categories of applicants;
- Eliminate an exclusionary restriction on PPP access for small business owners with prior non-fraud felony convictions, consistent with a bipartisan congressional proposal;
- Eliminate PPP access restrictions on small business owners who have struggled to make federal student loan payments by eliminating federal student loan debt delinquency and default as disqualifiers to participating in the PPP; and
- Ensure access for non-citizen small business owners who are lawful U.S. residents by clarifying that they may use Individual Taxpayer Identification Number (ITIN) to apply for the PPP.
Timing:
- Wednesday, February 24, 2021, at 9:00 a.m. is the starting date for the 14-day exclusivity period
- First week of March 2021: implementation of the other four changes
We expect further guidance in the next few weeks.
