Updates and Resources for Business

NAMM’s policy team discussed an overview of the provisions and potential impact of the American Rescue Plan 2021. Topics covered: support for businesses, school-reopening relief, housing and nutrition assistance, payments to cities, counties and states, unemployment insurance, vaccine distribution and more.

Resources:

COV-AID, Live Events Helping Distribute The Vaccine

The live events industry has come together to offer its resources and expertise to assist in safe, effective and expeditious vaccine distribution across the U.S.A.. Learn more: COV-AID Resource Guide 

COV-Aid Town Hall on March 8

The COV-Aid movement for the live events industry to support vaccination efforts began weeks ago through numerous organizations. To help spur interest and awareness of ways to get involved, the CMA Country Music Association hosted a Town Hall featuring Michael Strickland, Brad Nelms (We Make Events), and Dayna Frank (NIVA) to provide an overview of COV-Aid and pinpoint ways for the industry to get involved.

Watch on YouTube

The Federal Reserve has confirmed that it will extend Paycheck Protection Program Liquidity Facility (PPPLF), the facility bolstering the Paycheck Protection Program. The Federal Reserve, with support from the Treasury Department, has twice extended the life of the PPPLF. With the newest extension, the program will remain open until June 30. 

Small Business Administration PPP Site

On March 3rd, NAMM joined more than 600 organizations nationwide as a signatory of the U.S. Chamber of Commerce coalition’s letter urging Congress to extend the application deadline for the Paycheck Protection Program (PPP) through the end of this year to ensure that the segment of small businesses facing the greatest obstacles does not get left behind. 

The Biden-Harris administration is announcing several reforms further targeting the PPP to the smallest businesses and those that have been left behind in previous relief efforts. While these efforts are not intended as a substitute for the pending American Rescue Plan, they will extend needed resources to help small businesses survive, reopen, and rebuild. Specifically, the Biden-Harris administration will:

• Institute a 14-day period, starting Wednesday February 24, 2021, during which only businesses with fewer than 20 employees can apply for relief through the Paycheck Protection Program. The 14-day exclusive application period will allow lenders to focus on serving these smallest businesses. The Biden-Harris administration will also make a sustained effort to work with lenders and small business owners to ensure small businesses take maximum advantage of this two-week window which closes on March 31.
• Help sole proprietors, independent contractors, and self-employed individuals receive more financial support by revising the loan calculation formula to offer more relief and establish a $1 billion set aside for businesses without employees located in low- and moderate-income areas.
• Eliminate an exclusionary restriction that prevents small business owners with prior non-fraud felony convictions from obtaining relief through the PPP.
• Eliminate an exclusionary restriction that prevents small business owners who are delinquent on their federal student loans from obtaining relief through the PPP.
• Ensure access for non-citizen small business owners who are lawful U.S. residents by clarifying that they may use Individual Taxpayer Identification Numbers (ITINs) to apply for relief.

As reported previously, in December, Congress approved another $284 billion for the program when it reopened Jan. 11 and made changes aimed at making it more accessible to minorities which allowed first-time applicants to the program to have their loans forgiven if they have fewer than 500 employees and use the money for approved costs, like payroll and rent. January revisions also allowed companies with 300 or fewer employees and a 25% drop in revenue, to apply for a second forgivable loan. The SBA approved almost 1.7 million loans worth $125.8 billion through Feb. 15, 2021.

The most recent changes to expand access to sole proprietorships may open funding opportunities for companies that have previously been shut out from PPP money.

The U.S. Small Business Administration (SBA) announced yesterday that the Paycheck Protection Program (PPP) will re-open the week of January 11 for new borrowers and certain existing PPP borrowers. Initially only community financial institutions will be able to make First Draw PPP Loans on Monday, January 11, and Second Draw PPP Loans on Wednesday, January 13. The PPP will open to all participating lenders shortly thereafter. Updated PPP guidance outlining Program changes to enhance its effectiveness and accessibility was released on January 6 in accordance with the Economic Aid to Hard-Hit Small Businesses, Non-Profits, and Venues Act.

“This updated guidance enhances the PPP’s targeted relief to small businesses most impacted by COVID-19.” said Treasury Secretary Steven Mnuchin. “We are committed to implementing this round of PPP quickly to continue supporting American small businesses and their workers.”

Key PPP updates include:

• PPP borrowers can set their PPP loan’s covered period to be any length between 8 and 24 weeks to best meet their business needs;
• PPP loans will cover additional expenses, including operations expenditures, property damage costs, supplier costs, and worker protection expenditures;
• The Program’s eligibility is expanded to include 501(c)(6)s, housing cooperatives, destination marketing organizations, among other types of organizations;
• The PPP provides greater flexibility for seasonal employees;
• Certain existing PPP borrowers can request to modify their First Draw PPP Loan amount; and
• Certain existing PPP borrowers are now eligible to apply for a Second Draw PPP Loan.

A borrower is generally eligible for a Second Draw PPP Loan if the borrower:

• Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses;
• Has no more than 300 employees; and
• Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020. Borrowers may choose any quarter for the year-over-year comparison.

The new guidance released includes:

• PPP Guidance from SBA Administrator Carranza on Accessing Capital for Minority, Underserved, Veteran, and Women-owned Business Concerns;
• Interim Final Rule on Paycheck Protection Program as Amended by Economic Aid Act; and
• Interim Final Rule on Second Draw PPP Loans.

For more information on SBA’s assistance to small businesses, visit sba.gov/ppp or treasury.gov/cares.