FLASH UPDATE ON PPP
Since the moment PPP went into effect, we have taken feedback from hundreds of businesses across Louisiana on how to make the legislation better. The PPP Flex Act helps to address many of the imperfections we have heard from these small business owners and employees to ensure we can maximize the funding to best serve their needs.
The U.S. House of Representatives passed H.R. 7010 – Paycheck Protection Program Flexibility Act of 2020 today. The bill gives businesses more time and flexibility to make qualifying expenditures for loan forgiveness under the Paycheck Protection Program (PPP) and allows businesses with forgiven loans to defer payroll taxes.
Watch the video to hear about the different changes to PPP, or read more below.
They were able to reach an agreement on five important wins that y’all helped us to identify in terms of improvements or fixes to that program to help keep businesses afloat, to help businesses to keep cutting checks to vendors and employees
Number one, instead of being stuck in just that 8-week term, it’s actually been extended out to 24 weeks if folks opt for that longer period of time.
Number two, instead of having to spend all of the money or certain percentages of the money on certain categories, it gives more flexibility among those four eligible categories of funding that you recall. The payroll, the rent, mortgage interest, and utilities – so it gives more flexibility there.
Number three, it provides more flexibility in hitting your pre-coronavirus employee numbers. We’ve spoken to a number of you that have talked about your challenges in hiring people back because of the incredibly generous unemployment program that is out there or the families that are staying home to take care of loved ones. So we’ve provided more flexibility there.
Number four, we’re providing a longer-term maturity for the loan. Instead of just the two years, you’ll have a minimum of five years at the same 1 percent interest rate to pay back any residual of the loan, meaning any portion of the loan that is not forgiven.
Number five, you may recall there is an either-or. You can apply for the Paycheck Protection Program or be eligible for the employee retention tax credit through the payroll tax. We’ve eliminated that either or so you will be eligible for both.
Now look, I know that the program is still not perfect, but this addresses a lot of the top priorities, the top concerns that y’all have identified for us. To help provide that bridge across this tough time, to help out Louisiana families.
At the end of the day, this is all about people. It’s about helping families get those paychecks to continue on getting that hand-up, that lifeline, through this tough period. And that’s what these fixes do.
So we are excited about this big step forward and we’re gonna continue working to fix every other imperfection in this program and others as we move forward.
Thanks, stay safe, and God bless.