HARLINGEN, Texas (KVEO) — The third round of the Small Business Administration’s Paycheck Protection Program (PPP) has reopened this week with a few updates.
The forgivable loan program was created through the CARES act and has provided hundreds of billions of dollars to small businesses to help keep them afloat.
According to the SBA, borrowers are generally eligible if their business has fewer than 300 employees, has lost at least 25% of its revenue in a quarter of 2020 and has spent the full amount of prior PPP loans.
“It expands on the original PPP of providing loans to businesses for payroll and other costs to help businesses remain viable and allow their workers to pay their bills,” said Lower RGV SBA District Director Angela Burton.
The loans have helped more than 20,000 businesses in the 14 counties it serves — including Cameron, Willacy, Hidalgo and Starr.
Most recently, the funding expired in early August, but a third-round offering $284 billion will soon be available to even more businesses, as the eligibility guidelines have expanded to new organizations.
“One of the big ones is 501 (c)(6), which are chambers of commerce or economic development organizations,” said Burton. “Those organizations have really stepped up in supporting small businesses, so now the eligibility has been expanded to 501 c)(6)’s, housing cooperatives and destination marketing organizations.”
If their application was denied in the first or second round, Burton recommends trying again, due to the program’s updated terms, which include more costs covered.
“The new PPP will cover additional expenses including operation expenditures, property damage, supplier cost and worker protection expenditures,” she said. “It provides greater flexibility for seasonal employees; certain existing PPP borrowers can request to modify their first drawn loan amount and certain existing PPP borrowers are now eligible to apply for the second draw.
“We just have to look at the whole situation and determine at what point folks are eligible and for what items and for what loans.”
In an effort to best assist underserved small businesses, the loan portal is currently just open for community financial institutions but will be opening to additional lenders in the next few days.
Burton recommends individuals interested begin gathering documentation and making contact with their lenders.
“Just say, ‘hey I’m interested in applying for PPP, when are y’all going to open the portal,?’ we don’t know yet obviously but just having that communication with your lender and expressing you want to apply or wanting to do second, third round or additional round of PPP and looking at parameters around that to make sure you’re eligible.”
If borrowers stay within the program’s guidelines, the loan may be fully forgivable, otherwise, there is a 1% interest rate for the first five years.
The deadline to apply is March 31.
For more information, visit SBA.gov/PPP.