May 06 PPP Certification Requirements Update: Deadline to Return Funds Extended to May 14, 2020
The Paycheck Protection Program (PPP) certification requirements have been front and center in the minds of potential borrowers. To recap, the SBA’s recently released FAQ #31 augments the existing borrower good faith certification that is required as part of the application process. While borrowers still must certify that “current economic conditions make necessary the loan request to support the ongoing operations”, there is a recently added layer that also entails consideration.
New and existing applicants, as well as borrowers who have already received PPP funding, must “take current business activity into account” when determining if PPP funding is needed. Furthermore, a borrower’s “ability to access other sources of liquidity sufficient to support ongoing operations in a manner that is not significantly detrimental to the business” must be analyzed.
FAQ #31 further stipulated that borrowers who had applied by April 23, 2020 have a May 7, 2020 deadline to return the funds if they determined that they could not meet the standards of this good faith certification. The May 5, 2020 release of an updated set of SBA FAQs added FAQ #43, indicating that the deadline has been extended from May 7, 2020 to May 14, 2020. Furthermore, the SBA intends to issue guidance on how it will review the certification prior to the updated deadline date.
While we await further guidance in terms of how this certification standard will be met and analyzed by the SBA, we point you to our recent e-blast, “Additional PPP Certification Requirements” for ideas and tips on how to document your good faith certification position.
Sax will continue to update you as further details are made available. Reach out to your Sax advisor or email [email protected] with questions. For more and on-going information relative to your state and business, visit Sax’s COVID-19 Resource Center.