Inc. & U.S. Chamber of Commerce National Small Business Town Hall #5

April 30, 2020

Written by Kevin J. Ryan, Staff Writer, Inc.

The first round of the Paycheck Protection Program ran out quickly, and it's likely the second will too--but don't let that prevent you from applying for a loan if you need one.

That was among the advice from panelists during the fifth National Small Business Town Hall on Friday. Inc. and the U.S. Chamber of Commerce are co-hosting the free weekly live webinars to help business owners stay informed about the resources available during the coronavirus pandemic.

After the first $349 billion in PPP funds ran out in just under two weeks, Congress approved an additional $320 billion in funds to the program on Thursday. President Trump signed the bill into law on Friday.

While Neil Bradley, the Chamber's executive vice president and chief policy officer, said that he expects the replenished PPP will run out quickly given the volume of loans that are believed to be pending currently, he said applying is still worthwhile. "It's not that complicated--the form is not that difficult to fill out," Bradley said. "My advice to you is: If you need the money, go ahead and apply. Hopefully, you get in with this tranche of money, but if you don't, maybe there will be another tranche."

Bradley expects that the package signed into law Friday will not be the final stimulus measure. "The one thing I'm pretty confident about is that there's going to be some type of additional support for small businesses," he said. "It could be a replenishment of the PPP, it could be a modified PPP program."

The replenished PPP includes $60 billion in loans set aside for smaller lending institutions and those that serve underrepresented communities. "That might be a great avenue to get in," Bradley said. But he added that you shouldn't assume that your community bank has already been approved to issue these loans. Some smaller institutions are still in the process of getting approved by the Small Business Administration. If you're considering going to one for a loan, call them ahead of time to find out whether they're participating in the PPP.

The legislation also adds $10 billion to the Economic Injury Disaster Loan (EIDL) program. The Treasury Department initially directed the SBA to disburse forgivable advances of up to $10,000 within three days to any business that applied for one. But the Department soon reduced the size of the advances to $1,000 per employee for a maximum of $10,000.

Bradley doesn't expect those limitations to change, given how oversubscribed the program was the first time around. The SBA received an estimated $400 billion worth of requests for $10 billion in available funds. Still, if you are able to secure one, an EIDL can serve as a good resource to use in conjunction with a PPP loan. "The PPP is a great program to help with payroll," he said, since those loans are fully forgivable if you use at least 75 percent on paying your employees. "The EIDL then can be used for capital expenses or other ongoing expenses that maybe you don't have enough money from the PPP to cover."

In Inc.'s Town Hall #5, experts discuss if it's already too late for businesses to get new PPP funds.

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