COVID-19 Update 3/26/2021

PPP Extended Until May 31

Yesterday, the Senate passed legislation by a 92-7 margin to extend the deadline for Paycheck Protection Program (PPP) loan applications to May 31.

Under the legislation, which overwhelmingly passed the House a week earlier, PPP applicants have until May 31 to apply for a loan and the Small Business Administration (SBA) has a June 30 deadline to process them.  More than $50 billion remains available from the amount Congress approved for the program.

The White House has indicated its support of the extension and President Biden is expected to sign it into law.

SBA Extends Deferment Period for all COVID-19 EIDL and Other Disaster Loans until 2022

The U.S. Small Business Administration has announced extended deferment periods for all disaster loans, including the COVID-19 Economic Injury Disaster Loan (EIDL) program, until 2022.

• All SBA disaster loans made in calendar year 2020, including COVID-19 EIDL, will have a first payment due date extended from 12-months to 24-months from the date of the note.
   
• All SBA disaster loans made in calendar year 2021, including COVID-19 EIDL, will have a first payment due date extended from 12-months to 18-months from the date of the note.

Existing SBA disaster loans approved prior to 2020 in regular servicing status as of March 1, 2020, received an automatic deferment of principal and interest payments through December 31, 2020. This initial deferment period was subsequently extended through March 31, 2021. An additional 12-month deferment of principal and interest payments will be automatically granted to these borrowers. Borrowers will resume their regular payment schedule with the payment immediately preceding March 31, 2022, unless the borrower voluntarily continues to make payments while on deferment. It is important to note that the interest will continue to accrue on the outstanding balance of the loan throughout the duration of the deferment.

COVID-19 EIDL loans are offered at very affordable terms, with a 3.75% interest rate for small businesses and 2.75% interest rate for nonprofit organizations, a 30-year maturity. Interest continues to accrue during the deferment period and borrowers may make full or partial payments if they choose.

In mid-February 2021, SBA reached a milestone in the success of the COVID-19 EIDL program, by approving over $200 billion in emergency funding in low-interest loans, providing working capital funds to small businesses, non-profits and agricultural businesses to survive the severe impacts of this catastrophic and historic period within the entire United States of America and its territories. SBA continues to approve over $500 million each week for the COVID-19 EIDL program.

Questions on SBA COVID-19 EIDL and disaster loan payments can be answered by email at DisasterCustomerService@sba.gov or by calling SBA’s Customer Service Center at 1-800-659-2955 (TTY: 1-800-877-8339).

COVID-19 Vaccine Employer Toolkit

The Minnesota Department of Health has created a toolkit designed to direct employers to the resources they need to help their workforce get vaccinated safely and efficiently and to provide materials to educate employees about COVID-19 vaccines.  Those resources can be found here.

Note: This content and analysis is for informational purposes only and should not be construed as legal advice.  Please consult your legal and financial advisors for detailed information before taking any action.