If your firm has experienced a 25 percent or greater revenue drop in any 2020 quarter compared to 2019 and have used the full amount of the its first-draw Paycheck Protection Program (PPP) loan, you will be eligible to apply for the second-draw loans now available for borrowers, reports the Small Business Administration (SBA). Your firm also needs to have 300 or fewer employees.
Using this newly-released criteria, Frank Stasiowski, FAIA, PSMJ’s founder and CEO estimates that about 30 percent of AEC firms will qualify. “Remember,” he says, “This second round of PPP loans are going to be generally subject to the same terms, conditions, and requirements as the first round. And it is first-come, first-served while the money lasts.”
Changes made by Congress include those on fees, eligibility, loan amounts, eligible expenses, reliance on borrower certifications, and loan increases. The maximum loan amount is $2 million or two and a half months’ worth of average payroll costs, whichever is less, Stasiowski explains. The rules do offer further calculations that will help design firms determine eligibility and how much the loan can be.
While the SBA did release some details today and rules for this latest round of lending, it did not reveal the date on which it will reopen its portal for applications for the $284 billion in loans. “Your best bet is to be ready as quickly as you can for this next round of money,” Stasiowski explains.
The American Bankers Association (ABA) has announced that community financial institutions will have the ability to submit loan applications for the PPP for at least two days before all other lenders. The ABA did note that the second round has set aside specific pools of funds for those businesses who did not borrow previously, very small businesses, and small businesses in low and moderate income neighborhoods.
| Join Frank on Thursday, January 14th, at 1 p.m. ET for PSMJ’s next LIVE ONLINE AEC Senior Executive Briefing where he’ll share his latest PPP insight and what AEC firm leaders need to do now to take full advantage of available funds. |
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