Paycheck Protection Program — Updated Guidance from the SBA

May 20, 2020

Provided by CAMICO Loss Prevention
 
On Wednesday, May 13th, the Small Business Administration (SBA) updated their Frequently Asked Questions Document (FAQ) and added FAQ #46 and FAQ #47.

In FAQ 46, the SBA revised its review threshold and safe-harbor provision and noted that businesses that accepted Paycheck Protection Program (PPP) funds of less than $2 million will be assumed to have made the required certification concerning the necessity of their loan requests in good faith. However, businesses with loans in excess of $2 million will still be subject to review by the SBA. This FAQ further clarified the SBA’s intent to seek repayment of the outstanding loan balance if a business under review is deemed to lack sufficient support for the required certification concerning "necessity" in accordance with the terms of the PPP program, in addition to informing the lender that the PPP loan is not eligible for forgiveness. However, the SBA noted that they will not pursue administrative enforcement or referrals to other agencies with respect to such certification if the business repays the loan in accordance with this provision.
 
FAQ #47 extends the repayment date for the safe harbor to May 18, 2020, (previously May 14th per FAQ #43) to give businesses some opportunity to review and consider FAQ #46.
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