On Tuesday the Senant passed a $484 billion coronavirus relief package that would replenish the depleted Paycheck Protection Program, which offers guarantees for forgivable loans to small businesses if a majority of the money is used to retain employees.
The House is expected to pass the bill on Thursday, and President Trump has indicated he will sign it.
Crucially to farmers and others in agriculture related enterprises, the new bill makes farms and other agricultural businesses with no more than 500 employees newly eligible to apply for loans and grants. The bill adds $60 billion for the Small Business Administration’s disaster relief fund — divided into $50 billion in loans and $10 billion in grants.
Forgiveness of these loans is determined on how the loan funds are utilized. The loan must be used to cover payroll costs for eligible employees, with no reductions in staff or compensation; mortgage interest; rent; and utility costs over an eight-week period after the loan is made. Up to 25% of the forgiven loan amount can be used to cover non-payroll expenses.
Those who have already applied for a loan via the PPP or the Economic Injury Disaster Loan (EIDL) program, or both, should contact the bank they applied to immediately to see if it still has the application and if it will be resubmitted to the SBA when the process restarts. Applicants can only apply for one PPP loan, so if the application is in queue with the bank, the applicant have to wait to get funding until the bank submits it.
Those who have not applied yet for a PPP loan or an EIDL should do so as soon as possible.
The SBA’s coronavirus relief page can also help potential applicants keep track of the assistance programs' rules and updates.
Agreement on the new bill, known as the Paycheck Protection Program and Health Care Enhancement Act, was reached after extensive negotiations between Republicans and Democrats, and is expected to be signed into law later this week.