Helpful Tip of the Day – PPP Safe Harbor Date Extended to May 14th:
The SBA released additional FAQs that extended the safe harbor date for companies to return PPP funds to May 14th AND stated that the administration intends to provide additional guidance on borrower certification and we are hoping this will help provide additional clarity to recipients to make an informed decision on their loans. Full FAQ on this issue below and updated FAQs here. The updated FAQs also addresses a question in regards to counting the employees of foreign and U.S. affiliates. SBA also released a summary of PPP2 loan data as of 5pm EDT – Tuesday, May 5, 2020, noting that the program has provided more than 2.3 million loans for small businesses this round for a total of $181 billion, leaving approximately $129 billion still available.
- Question: FAQ #31 reminded borrowers to review carefully the required certification on the Borrower Application Form that “[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.” SBA guidance and regulations provide that any borrower who applied for a PPP loan prior to April 24, 2020 and repays the loan in full by May 7, 2020 will be deemed by SBA to have made the required certification in good faith. Is it possible for a borrower to obtain an extension of the May 7, 2020 repayment date?
Answer: SBA is extending the repayment date for this safe harbor to May 14, 2020. Borrowers do not need to apply for this extension. This extension will be promptly implemented through a revision to the SBA’s interim final rule providing the safe harbor. SBA intends to provide additional guidance on how it will review the certification prior to May 14, 2020.