Rural small businesses have two more months to apply for the Paycheck Protection Program (PPP), to keep their workforce employed and to cover normal operating expenses during this ongoing COVID-19 crisis.
Two days before the program was set to expire, the PPP Extension Act of 2021 was signed into law This extended the sign up deadline to May 31, 2021. The Act also provides an additional 30-day period for the Small Business Administration to process applications that are still pending.
Businesses can use PPP Loans for payroll costs, mortgage interest, rent, utilities, worker protection costs, uninsured property damage costs by looting or vandalism, and certain supplier costs and expenses for operations.
There are two types of PPP Loans: First Draw Paycheck Protection Program (PPP) Loans are for first-time program participants; have a term of up to 5 years, 1% interest rate; and may be completely forgiven. Second Draw PPP Loans are for certain businesses who have previously received a PPP loan (for those who can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020).
More information can be found at sba.gov.
Kim Preston, Rural
Center for Rural Affairs