New Round of PPP Funding Available

The Economic Aid to Hard Hit Small Businesses, Nonprofits and Venues Act, signed into law December 27, 2020, included more funding for the SBA’s Paycheck Protection Program (PPP). Most community banks, including New Market Bank, will be in the second wave of lenders allowed access to the application portal. Once we know when our access opens, we will update our website and announce it on social media. According to the SBA, plenty of funds are available - there's no need to panic and apply immediately.

The new funding is available to both first-time PPP borrowers and businesses that received a PPP loan previously. Consistent with previous PPP funding rounds, loans are fully guaranteed by the SBA and, if used for eligible expenses, may be 100% forgivable. Loan amounts not forgiven are financed at 1% interest for a 5-year term. You can choose a covered period of 8-24 weeks beginning on the date of origination. Once submitted to the SBA, approval is expected within 48 hours. Funds are generally dispersed within 10 days.

First-Time PPP Applicants:

  • The list of eligible entities has expanded from previous rounds but still limit to entities of 500 or fewer employees. Eligible entities include:
    • For-profit corporations, partnerships
    • Sole proprietorships, self-employed individuals, independent contractors
    • Nonprofit and veterans’ organizations
    • Tribal business concerns
    • Housing cooperatives
    • 501(c)6 organizations
  • Entities which devote 15% or more of their activities to lobbying or receive more than 15% of receipts/income from lobbying-related dues are NOT eligible.
  • You must get a first-draw loan prior to being eligible for a second.
  • Eligible expenses have expanded (although 60% of funds still need to be used on payroll). In addition to mortgage interest, rent and utilities, expenses include:
    • Operations Expenditures – Payments for business software or cloud-computing services, product or service delivery, processing/payment or tracking of payroll/HR/sales/billing functions, accounting expenses for tracking of supplies/inventory/records/expenses.
    • Property Damage Costs – Costs related to property damage due to public disturbances or riots occurring in 2020.
    • Supplier Costs – Expenses for goods essential to operations and made pursuant to a contract.
    • Worker Protection Costs – Operating or capital expenses to adapt business activities or facilities to comply with DHS, CDC or OSHA requirements for COVID-19.

"Second Draw" Applicants:

  • Eligibility for a second loan requires:
    • 300 employees or less
    • All funds from your first PPP loan must have been used - but not necessarily forgiven - for eligible expenses prior to receiving funds from a second loan.
    • A reduction of at least 25% or more in gross receipts in any quarter of 2020 when compared to the same quarter in 2019. We will need documentation of the reduction upfront, regardless of the size of the loan. This will help ensure forgiveness eligibility prior to application. 
  • Maximum loan amount is $2 million, which is based on 2.5 times the average monthly payroll, using either 2019 or 2020 payroll information. If you are a restaurant/hospitality business (NAICS code starting in 72), the calculated amount is 3.5 times the average monthly payroll.
  • Your first PPP loan number and amount are required for application. If you worked with us for your first loan, we have that information. If you used a different lender, that information will be needed.
  • If you used us for your first PPP loan and forgiveness, you will receive a personalized email from Teslar with a link to your second-draw application. It will carry forward company information and previous loan details, simplifying your application process. Watch for that email; do not use the application link posted on our website.

When we begin accepting applications, new and first-time applicants can apply online here.

Please keep an eye on our website or social media (see links below) or contact us at 952.469.1600 to find out if and when we are accepting applications.

Sincerely,
Anita Drentlaw, CPA
President