A new FAQ about PPP loans by the Small Business Administration is shared by David Bell, Executive Director of the United Methodist Foundation of Michigan.
United Methodist Foundation of Michigan, Exec. Director
Major new resources are emerging for those of you who are recipients of the SBA Paycheck Protection Program loan (PPP). Questions certainly still linger and will likely be clarified in the coming weeks.
However, we now have two major updates that will impact local church recipients. First, The Small Business Administration (SBA), in consultation with the Treasury Department, has just released a new FAQ #46 that appears to create a safe harbor for organizations receiving SBA PPP funds under $2 million. It states: “Any borrower that, together with its affiliates, received PPP loans with an original principal amount of less than $2 million will be deemed to have made the required certification concerning the necessity of the loan request in good faith.”
This response seems to address the earlier concern of some organizations with other established funds, like endowments, apart from their operating accounts. As a result of this safe harbor decision, most churches will automatically be considered to have needed the PPP loan and to have made the request in good faith.
Second, the SBA has issued the forgiveness application. Even though your completion of this application is several weeks away, I urge you to review this 11-page application now. Being familiar with the application and its various steps and requirements will help you adequately account for the usage of the loan funds over the eight-week period.
Again, the SBA has not cleared up all of the unresolved issues, so stay tuned to United Methodist Foundation of Michigan for further updates.
~ Click here for more COVID-19 Resources from the United Methodist Foundation of Michigan.