The Paycheck Protection Program has run out of money for most businesses, the Small Business Administration (SBA) announced May 4. The program was due to end on May 31.
“After more than a year of operation and serving more than 8 million small businesses, funding for the bipartisan Paycheck Protection Program has been exhausted,” said a Small Business Administration spokesperson.
The SBA has recently launched other, separate programs for specific businesses, such as restaurants and entertainment venues.
We’ve gathered articles on the Paycheck Protection Program from SHRM Online and other trusted media outlets.
The Paycheck Protection Program was created last year to help small businesses cover lost revenue if they continued to keep their employees on the payroll during the pandemic. The first round of funds was used in just two weeks in April 2020. More funds eventually were allocated. The program approved 7.6 million loans worth more than $687 billion between April and August 2020.
The most recent round of Paycheck Protection Program loans launched in early January with $284 billion in funding. The American Rescue Plan, enacted in March, added another $7.25 billion to the program. The $8 billion in remaining Paycheck Protection Program funds will be distributed for loans to businesses that are run by women, minorities and other underserved communities.
Under the Paycheck Protection Program, small businesses, eligible nonprofits and certain other employers could apply for a first loan if they employed fewer than 500 employees. Businesses that employed more than 500 workers also could be eligible if they met the SBA’s size standards for their industry. Businesses that received loans through the program last year may have been able to receive a second loan if they:
- Had no more than 300 employees.
- Already received a first draw PPP loan and used the full amount only for authorized uses.
- Could show at least a 25 percent reduction in gross receipts between comparable quarters in 2019 and 2020.
Other Relief Available
Other relief programs are available through the Small Business Administration. The Restaurant Revitalization Fund started accepting applications on May 3. The program has $28.6 billion in funding. In the first 21 days, the SBA will approve applications only from small businesses owned by women, veterans or socially and economically disadvantaged people.
The SBA also reopened applications for the Shuttered Venue Operators Grant Program in April, a program that has $16 billion in funding for small theaters, museums, live venue operators and certain other businesses that were closed during the pandemic.
Clarification for Shuttered Venue Operator Grant Recipients
Eligible businesses that received Paycheck Protection Program loans also could receive Shuttered Venue Operators grants if certain conditions are met. An SBA interim final rule clarifies that the amount of any subsequently approved Shuttered Venue Operators grant will be reduced by the amount of the first draw or second draw Paycheck Protection Program loan. The rule further states that the grant won’t be reduced by the Paycheck Protection Program loan amount if the business received the loan in 2020.