July 2, 2020
July’s PPP Update and some new statistics
Clients and Friends of the Firm,
Another month passed and this is now our 4th installment in a series of communications to keep you abreast of some of the many changes potentially impacting you, our clients. Some noteworthy PPP updates or reminders include the following:
- Many companies have now crossed the 8-week original timeframe to utilize PPP funds, which theoretically allows them to file for forgiveness. However, most banks aren’t ready to accept the applications for forgiveness. Further, many of these banks will not accept the paper or electronic loan forgiveness applications available on the SBA website since they’re developing their own internal application processes. Some bank websites provide a statement that they will notify PPP loan recipients by email when the forgiveness applications are available. That said, don’t mistake bank communications in the weeks to come as marketing and immediately delete without reading! If you need assistance with the forgiveness calc and support, let us know.
- To the surprise of many, the additional funds dedicated to the PPP Loan program were not fully utilized prior to the original loan application deadline this week of June 30, 2020. An amendment to extend the loan application deadline until August 8 was passed by Congress yesterday. If you or others you know did not apply but wish to, feel free to reach out if you need assistance. The remaining $130 billion is expected to be utilized, and Congress will define the additional funding in “CARES 4” in the weeks ahead.
- Additional discussions are ongoing about changes to other assistance programs, including an extension to the supplemental unemployment benefits schedule to expire at the end of July, and revising terms for new loans taken. There is also discussion that loans under $150,000 may be automatically forgiven, so we await further guidance, particularly for these smaller loans.
- After the country lost 21 million jobs in April, we saw 2.7 million job gains in May and an uptick of 4.8 million in June. Positive signs, though the advances seem precarious today in light of some retrenching on business openings. One study has shown that only 29% of small companies retained their entire staff throughout the pandemic, but we are seeing signs of strength in technology and life sciences in both our small and large clients, so we remain cautiously optimistic. We continue to recruit for select roles, and while far fewer than typical, virtual hiring and onboarding has become a reality almost all are accepting, and new reqs are opening. We expect the third quarter to show more positive signs!
Wishing you all a safe and happy Independence Day,