Shuttered Venue Operators Grant Portal Open
The Shuttered Venue Operators Grant (SVOG) portal opened on 4/8/21 at noon EST on the SBA.gov website. There have been reports that the website has been down intermittently due to an overwhelming response for funding. We recommend being patient and persistent in your efforts to complete the application process. As a reminder, once you submit your SVOG application, you will no longer be eligible to apply for a first or second draw Paycheck Protection Program (PPP) loan.
Paycheck Protection Program Extended; Funds Dwindling
The time to apply for a first or second draw Paycheck Protection Program (PPP) loan was extended to May 31st thanks to the PPP Extension Act signed into law on March 30th by President Biden. While this is great news for those who have yet to apply or those whose loans were stuck in processing, the issue of diminishing funds looms large. The SBA anticipates that remaining PPP funds will likely run out before the end of this month.
The SBA has also clarified that borrowers who received a first draw loan in 2021 are now eligible to apply for a second draw loan, if they meet second draw eligibility requirements, due to the extended time to apply. Again, with funds potentially running out, this may seem like a ‘too good to be true’ scenario. In addition, legislation may soon be presented in Congress to allow Schedule C filers who applied for a PPP loan in 2021 prior to the change in loan calculation to retroactively apply for an increase in their 2021 loan amount. While it is possible that new funding may be added to the program before the new deadline to apply of May 31st, it is important to get your applications in now, if you are eligible to apply.
Restaurant Revitalization Fund Still on Hold as Other Programs Roll Out
Anticipation for the Restaurant Revitalization (RRF) Fund is high as restaurants and similar businesses have been one of the hardest hit sectors over the past year. Unfortunately, the promised ‘early-April’ rollout seems to be slipping away as updates continue to be made to the Paycheck Protection Program (PPP), Economic Injury Disaster Loan (EIDL) Program, and the Shuttered Venue Operator Grants (SVOG) portal opening. While it is anticipated that potential applicants of RRF will NOT need a DUNS number, it may still be in a business’ best interest to start the process in case this information changes. A DUNS number can be obtained at dnb.com and may take more than a week to receive. In addition, registering with SAM.gov after you’ve received the DUNS number will ensure that you are ready with this information if it is in fact needed.
Current information on RRF includes a basis calculation for anticipated grant amounts. Potential applicants will be able to apply for a grant amount equal to 2019 gross receipts minus 2020 gross receipts minus any PPP loans received up to a maximum of $10 million per entity or $5 million per physical location. These grants would have fewer restrictions on eligible expenses and only amounts ‘un-spent’ in the eligible time period may need to be returned.
Economic Injury Disaster Loans See Maximum Potential Loan Increased
Starting the week of April 6, 2021, maximum Economic Injury Disaster Loans (EIDL) have been increased to $500,000, up from $150,000. If an EIDL recipient had already received and accepted an EIDL loan, the SBA has started reaching out to offer increases to those that are interested. All recipients have two years from the date of the originally issued loan to request an increase. Collateral is required for loans over $25,000 and a personal guarantee is required for loans over $200,000.
Please continue to keep an eye on our COVID-19 Resource Center for updates as they are made available. Our recent webinar series Making Cent$$ of Stimulus Money covered a number of these topics in more detail. The recordings and presentations can be found in the resource center. For additional questions, please feel free to reach out to your Wegner CPAs relationship manager or Kate Serpe, CPA.
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