Late last week, President Trump signed the Paycheck Protection Flexibility Act, a bill that provides updates to the Paycheck Protection Program (PPP). The U.S. Treasury and the Small Business Administration (SBA) are now implementing new rules and guidance to PPP borrowers and lenders.
Changes to the PPP include:
- Extending PPP coverage from 8 weeks to 24 weeks, not to extend beyond December 31, 2020.
- Reducing the requirement that 75% of the funds must apply to payroll to 60%.
- Increasing the time borrowers must restore their workforce levels to prepandemic levels for full forgiveness from 8 weeks to 24 weeks. This must be completed by December 31, 2020.
- The term for PPP loan repayment for new borrowers is increased to 5 years. Existing PPP loans with the original 2-year repayment can extend to 5 years if lender and borrower agree.
The Maine SBA District Office has been sending regular updates to PPP lenders with updated guidance. Please contact the League or the Maine SBA District Office if you have any questions or concerns.