How small businesses can apply for the Payroll Protection Program (forgivable loan)

​Greetings Roo friends and fans,
We wanted to provide an update regarding the COVID-19 related Payroll Protection Program (PPP). Many thanks to Propel Nonprofits, the Minnesota Council of Nonprofits and Sunrise Banks for providing the source data for this post.
 
Who is eligible?

• Employers with 500 or fewer employees
• Non-profits (this is significant, as nonprofit employers are not typically eligible for Small Business Association loans (SBA loans)
• Self-employed individuals

 
How much money is available and how can it be used?

• Organizations can apply for a (forgivable) loan equal to 2.5 times monthly payroll. You can use either option described below to calculate your maximum loan amount.
  • Option 1: 12 months average payroll since February 15th or;
  • Option 2: 2019 payroll data
  • Employers must deduct individual earnings over $100,000
• 75% of the loan must be allocated for payroll expenses.
• Other eligible expenses include employer costs for healthcare, retirement plan contributions, rent and utilities

 
Which staff members are included?

• Only applies to employees on payroll.
• Independent contractors are not included in agency reporting, but can choose to file individually 
• Grant-funded positions are included and do not need to be tracked separately

 
Loan forgiveness Provisions

• Loans may be 100% forgiven provided employers keep staff on payroll through June 30th
• Must provide documentation to lender by June 30th
• Loan forgiveness will be reduced if employers reduce payroll or headcount through June 30th
• Should a portion of the loan not be forgiven, employers have 2 years to repay the loan at an interest rate of 1%

Interested in applying? Here is a link to the application form: SBA Application form

Stay strong friends!