With the end of the Paycheck Protection Program on May 31, 2021, a number of small business owners have been asking and thinking about other U. S. Small Business Administration (SBA) loan programs, and it is perhaps a propitious moment to remember why SBA loans are so attractive to small business owners, how they reduce lender risk, and why that is beneficial for a loan applicant.   

Generally speaking, SBA-guaranteed loans are attractive to small business owners because they have longer terms and lower down payment requirements than conventional loan products.  Further, SBA-guaranteed loans have capped interest rates and no balloon payments.  The loans are made through a private lender and then guaranteed by the SBA.  That guarantee lowers the lender’s risk which allows them to approve borrowers where they may not have been able to extend credit otherwise.  

Small, for-profit businesses are eligible for an SBA-guaranteed loan.  Each lending scenario rests on its own merit and the lender’s criteria for extending credit.  Just as with any conventional loan product, SBA participating lenders evaluate the borrower’s ability to repay the loan.  The credit score is a key indicator of the borrower’s credit history.  A low score would be a weakness while a high score would be a strength.  It’s important to keep in mind that you have the option to “shop” lenders and find loan terms that best benefit your business.  Along that same line, even if one lender declines the loan, another lender could approve it.  SBA works with a large network of lenders and so business owners have many options, to include large traditional banks, regional banks, and smaller community-based lenders.  Your local SBA District Office can provide you with a list of participating lenders in your area. You can also use SBA’s on-line lender matching tool to connect with SBA-approved community development financial institutions (CDFI) and small lenders from all over the country at. Many business owners find it helpful to meet with a business advisor from one of SBA’s business counseling resource partner organizations as they research their financing options.  You can find a business advisor near you by using our locator tool at.  These partner advisors can assist the businesses owner in any aspect related to applying for financing, be it identifying lenders, preparing a strong loan package or even building or repairing credit if that is a concern.  As our partners, these advisors offer their services at low or no cost and are a great resource to any business owner looking to start or grow their business.  

The application process is managed by the participant lender from start to finish.  The exact paperwork and forms required is determined by the lender.  Generally speaking, most lenders will ask for your business plan, tax returns and financial statements (or financial projections for a new company).  Advisors with our SBA small business counseling partners, the SCORE Association, the Small Business Development Center or a Women’s Business Center, can assist with preparing these documents and the loan package.  These services are free of charge. 

A question often asked by a potential borrower is “how long does the process of applying for an SBA loan take” or “what is the average wait time before applicants receive funding after the approval?”  The easy answer is that it depends on what authority the bank has with SBA and whether they process a loan using their delegated authority.  If they use delegated authority, they generally receive the SBA approval instantly.  While there is no guaranteed timeline, generally speaking, borrowers report completing the full process anywhere from two weeks to one month.  Quicker processing time usually occurs when a lender is an SBA-preferred lender and that is why there is an advantage to working with them.  When a lender has Preferred Lender status, the lender has authority granted by SBA to make final credit decisions on SBA-guaranteed loans.  Non-preferred lenders must submit the loans directly to the SBA for approval, which may make the process longer and can potentially be a timing issue.  

Borrowers also often want to know the most common reason an SBA loan application is rejected.  Many times, it is because of insufficient or incomplete application information or issues of character, such as a criminal record or bankruptcy.  It is important to remember that even with the SBA guarantee, the lender may require the borrower to provide a down payment or additional collateral because the SBA guarantee does not eliminate risk, it merely reduces it.  The exact terms of what is required is based on the overall risk of the transaction.  Always remember that personal guarantees also apply, and the borrower does have an obligation for repayment.  

To learn more about how SBA loans can benefit your small business, please join us for our monthly SBA Arizona Virtual Loan Clinic, next offered on Wednesday, August 4^th at 9am.  We will discuss financing options, general loan requirements and tips for preparing a successful loan application.  No registration is necessary.  Webinar log-in information is at   

In addition to our website, please follow us on Twitter and view our Resource Guide at for further information. 

Robert J. Blaney has served as the district director of the U.S. Small Business Administration for the State of Arizona since 1998. His experience includes work as a federal agent, police officer, vice-president of an insurance brokerage and district director for the late Congressman Jack Kemp. 

About the U.S. Small Business Administration 

The U.S. Small Business Administration makes the American dream of business ownership a reality. As the only go-to resource and voice for small businesses backed by the strength of the federal government, the SBA empowers entrepreneurs and small business owners with the resources and support they need to start, grow or expand their businesses, or recover from a declared disaster. It delivers services through an extensive network of SBA field offices and partnerships with public and private organizations. To learn more, visit. 

The post Why SBA Loans are Attractive to Small Business Owners appeared first on ���ϳԹ���.

Congress approved a new $1.9 trillion stimulus package Wednesday to help carry the nation through the final stage of the pandemic. Out of that, Arizona expects to receive about $12 billion for aid to businesses, schools, families and others still struggling from pandemic shutdowns and disruptions. 

After several hours of testimony on the House floor, the measure, which was passed by the Senate on Saturday, was approved along party lines, 220-211, with all Democrats in support. Passage of the bill comes as expanded unemployment benefits are set to expire Sunday.  

President Joe Biden issued a statement celebrating the bill’s passage, saying he is ready to sign it into law. 

“This legislation is about giving the backbone of this nation — the essential workers, the working people who built this country, the people who keep this country going — a fighting chance,” Biden said.  

Main Street support

Corporate America and Arizona business leaders expressed reservations about the bill’s size and scope.

“The business community and state leaders will be poring over this bill in the coming days to better understand all of its implications,” said Garrick Taylor, interim president and CEO of the Arizona ���ϳԹ��� of Commerce & Industry. “This bill, obviously, contains more than just targeted spending directly related to the fallout of the pandemic, but its inclusion of public health funding and tools to end the scourge of this pandemic once and for all is welcomed. Widening and accelerating the distribution of the vaccines is essential to relieving the pressure on our healthcare system and getting the broader economy back to full strength.”

Here’s what’s in the rescue plan

Here’s what the American Rescue Plan Act means for businesses, schools, families and others still struggling from pandemic shutdowns and disruptions. 

Restaurants, bars and food service providers: A dedicated relief fund of $28.6 billion is intended to help small and mid-sized restaurants, bars, caterers, food trucks, breweries and other food service providers in need of assistance with rent and operational expenses. It provides grants of up to $10 million per entity with a maximum of $5 million per location based on the difference between 2020 and 2019 revenue. 

Small businesses low-interest loans: The package provides $15 billion to theEmergency Injury Disaster Loan program for small businesses to receive to low-interest loans from the U.S. Small Business Administration (SBA). Advances for small businesses of up to $10,000 may be converted to grants if used to cover business’s operating expenses. The smallest companies, those with fewer than 10 employees, will be given priority for some of the funding.

Paycheck Protection Program : Provides an additional $7.25 billion for the PPP program. Expands eligibility to 501(c) nonprofits (except 501c4) and larger nonprofits, as well as internet-only news and periodical publishers. However, the Act does not extend the PPP’s current application period, which closes on March 31.

Voluntary tax credits for employers: A provision in the package offers tax credits for employers who voluntarily provide paid sick and family leave pay for people who are sick, quarantined or caring for a sick relative or child. 

Reauthorizes state Small Business Credit Initiative Act of 2010: Provides $10 billion to support small business financing to be expended by September 30, 2030. 

Economic Adjustment Assistance : Provides $3 billion for competitive technical, planning, and public works and infrastructure assistance to regions experiencing adverse economic impacts. Available until September 30, 2022.

Payroll Support Program : Provides $14 billion to air carriers and $1 billion to contractors. 

Extended and expanded unemployment benefits: Unemployed workers will receive an additional $300 to their weekly benefit through Sept. 6. The Pandemic Unemployment Assistance program in the plan also provides benefits not only to traditional W-2 workers but also to independent contractors, gig workers and freelancers affected by the pandemic. 

Tax-free unemployment benefits: The first $10,200 of benefits is non-taxable for households with incomes under $150,000. Additionally, the act provides a 100 percent subsidy of COBRA health insurance premiums to ensure that the laid-off workers can remain on their employer health plans at no cost through the end of September.

Families and individuals: The bill provides direct payments of $1,400 to individuals earning up to $75,000 a year and families earning up to $150,000. Individuals who make under $80,000 and families that earn under $160,000 also will receive a smaller amount. 

Tax credits for children: Qualifying families with children 6 and under will be able to claim a larger tax credit of $3,600 per child and $3,000 for each child under 18 for 2021. 

Housing assistance and mortgage and rent relief: Approximately $40 billion will go for housing assistance, including $21.5 billion to be divided up among state and local governments to help low-income households with rent and mortgage assistance and utility bills.

The plan also provides $350 billion in aid to state and local governments; $170 billion for K-12 schools, colleges and universities to reopen; and over $100 billion for health care, including COVID-19 testing and vaccine distribution. 

What’s not in the package

Minimum wage hike: A controversial measure to raise the minimum wage did not survive an earlier version of the rescue plan. The measure would have more than doubled the minimum wage from $7.25 to $15 in increments over the next four years. The Senate parliamentarian ruled that the proposal did not meet requirements for a reconciliation bill. Expect the issue to come up in a separate bill later on. 

Arizona to receive an estimated $12 billion in aid 

An by the Arizona Joint Legislative Budget Committee (JLBC) estimates that  the state should receive about 2 percent of the stimulus package, or $12.3 billion, excluding the extended unemployment benefits.

Included is funding for projects that will help economic development across the state, including rural communities that have been hit particularly hard by the pandemic, said Carrie Kelly, executive director of the Arizona Association for Economic Development.

“There’s $690 million in transportation and $145 million in broadband and connectivity funding for Arizona that will help bridge the digital divide and create infrastructure jobs,” Kelly said. “Additionally, the $2.6 billion that Arizona local governments will receive helps those rural communities that need it most.”
To read the bill in full, visit:

The post What new stimulus package means for Arizona, nation appeared first on ���ϳԹ���.

As Congress this week returns to Capitol Hill to consider its fourth major pandemic relief and response bill (a fifth bill updated elements contained in a previous bill), I anticipate that there are seven major elements that will be included in some form or fashion.

The Wall Street Journal had an excellent over the weekend that laid out the various issues that the next bill might address. Here’s my take on the items identified in the story:

Unemployment benefits.

The first aid package contained a massive expansion of unemployment benefits at $600 above a state’s existing unemployment insurance payment. Lawmakers approved the enhanced benefit knowing that, for many workers, the additional dollars would deliver a temporary income higher than what they were previously earning at their job. It’s unlikely a similarly generous payout will be repeated.

Still, given that unemployment levels remain high, supplementing regular state unemployment insurance is justified, but it should be at a level that does not exceed a worker’s pay before a furlough or a layoff. There are some creative bipartisan proposals that deserve consideration to encourage a return to work without pulling the rug out from under struggling households.

Additional stimulus pay.

The original CARES Act provided up to $1,200 per adult and $500 per child in direct cash assistance. Again, given the current high unemployment levels, additional relief makes sense. How much, exactly, and how it is targeted still needs to be settled.  

This moment also offers policymakers the chance to consider ways to improve the Earned Income Tax Credit, a refundable tax credit aimed at low- and moderate-income working families. One reform could include automatically issuing the credit to qualifying households without requiring the filing of a tax return. 

Schools reopening.

I strongly disagree with those who believe that schools should be penalized if they’re not open during a pandemic for legitimate safety reasons. We cannot and should not force teachers, support personnel, or students into a classroom or school environment where they don’t feel safe.

A carrot approach would be better, delivering funds attached to each student who is attending an in-person educational setting to reflect the increased costs. Funding must be available for face masks, cleaning products, PPE, and the implementation of any other healthcare protocols necessary to improve school safety and hygiene.

Funds should also be available for distance learning, which will be necessary to provide resiliency if schools must close or for students who have underlying health conditions and for whom a return to in-person learning might be delayed.

There should also be funds allocated for all parents and guardians, perhaps subject to income limitations, for expenses related to transportation and connectivity like WiFi or laptops.

In Arizona, it’s estimated that the cost to provide for a safer in-person learning experience is $485 per child. 

Liability reform.

Liability reform is essential not just for regular businesses attempting to reopen safely and responsibly, but for schools, cities and towns, non-profits as well as healthcare providers. We don’t want concerns over dubious lawsuits to delay our recovery.

This protection should provide certainty for those acting in good faith to follow applicable state and CDC health guidelines. Ideally, there would be safe harbors in any protection.

Bad actors who are grossly negligent or who engage in willful misconduct should not be protected, and the relief should be temporary and targeted to Covid-19.

State and local aid.

Any additional aid to states and cities should provide maximum flexibility to these jurisdictions as long as funds are used to respond to the economic fallout from Covid-19. In other words, federal tax dollars should not be used for things like pension bailouts or other problems that existed long before the pandemic.

It’s important to point out that Congress did appropriate $150 billion in March for state and local governments. It would be useful to have a report on how those dollars were spent and any lessons learned that could be applicable to additional aid. It is worth considering additional aid for U.S. border communities whose finances have been devastated by the prolonged closure to most cross-border travel.

Additional business aid.

The Paycheck Protection Program is arguably the most successful business assistance program in the history of the world. Thus far, this small business rescue effort has provided about 5 million forgivable loans representing more than $515 billion.

In Arizona, the numbers are staggering. More than 81,000 small businesses have received these loans worth more than $8.5 billion.

There’s still about $130 billion left in the program, which after extensions is now set to expire August 8. Congress should extend the program again and more dollars should be added, and all loans already distributed should be completely forgiven if they’re under $150,000.

For smaller businesses, say those with 100 or fewer employees, or businesses in hard hit sectors like hospitality, a second round of lending should be allowed.

Congress should also expand the Employee Retention Tax Credit, which has bipartisan support. The credit helps employers keep their workers on the payroll while relieving a percentage of employment taxes. The president’s payroll tax holiday is truly stimulative and, along with the administration’s deregulatory efforts, could provide the building blocks for a structurally sound recovery. 

With the continued tensions between the U.S. and China and the USMCA now in effect, incentives for vital supply chains for things like medical supplies and semiconductors to return to or expand in the U.S. deserve support.

Dealing with the virus.

Additional aid should be directed to testing and contact tracing, as well as building a robust public health infrastructure. It also makes sense to direct money at boosting the number of Americans who get the flu vaccine this year. A raging influenza season on top of Covid-19 could be devastating.

Dollars should be allocated for small- and medium-sized businesses for costs related to PPE and other protocols to make the workplace safer. Arizona Rep. David Schweikert has a good idea to help businesses offset the costs of providing tests for workers.

A massive PR campaign on wearing masks—the closest we have to a silver bullet when people are in public—is needed.

It’s easy to be a critic, but thus far Congress and the administration have risen to the occasion in supplying aid and direction in previous Covid-19 relief bills. I want to particularly thank our U.S. senators, Kyrsten Sinema and Martha McSally, for working tirelessly and turning their offices into virtual MASH units in assisting their constituents in dealing with this crisis.

Glenn Hamer is president and CEO of the Arizona ���ϳԹ��� of Commerce and Industry. 

The post What’s in the next pandemic relief bill? appeared first on ���ϳԹ���.

With Congress eyeing the next Covid-19 economic relief package, Arizona Rep. Andy Biggs, R, held a wide ranging with the members of the Arizona ���ϳԹ��� of Commerce & Industry last Thursday about the elements the next bill is likely to contain.

At the outset of his remarks, Biggs stressed that the U.S. economy prior to the pandemic was in very strong shape and that it could return to a similarly good place.

“One of the things that I think is important is that the economic foundation is still solid, we just have to have an opportunity to let it work and, if we do, then I think the foundation is there,” Biggs said. 

Biggs is concerned, however, what the next relief package will mean for the country’s overall debt and deficit position.

“When we had the robust economy, we had a trillion-dollar structural deficit already projected for this year,” Biggs said. “And now that structural deficit is going to be north of $4 trillion, and could be as high as $8 trillion depending on whose bill comes out in the next couple of weeks.”

Biggs said the country is facing a generational wealth transfer due to the trillions in dollars that have been deployed in the previous relief packages. 

“If you take the total national debt and compare it to our total gross domestic product, total economy, you start moving into a debt-to-revenue ratio that’s probably 110 to 112 percent, maybe even higher depending on who’s doing the calculating,” Biggs said. “That is a dangerous, dangerous place to be, and so we start worrying about a sovereign debt crisis.”

Extended enhanced unemployment benefit

A bill backed by Speaker of the House Nancy Pelosi would extend the $600 enhanced unemployment benefit that supplements state-level unemployment payments, something Biggs says worries him for the way it could delay Americans’ return to work. 

“I get from a lot of businesses when I talk to them, they say, ‘Please, end that, because we can bring back employees. They don’t want to come back because they’re getting a $600 bonus on a weekly basis from the feds.’” Biggs said. “(Pelosi’s) package would take that into next spring and, actually, in some instances increase that unemployment package.”

Liability protections a priority

Biggs says ensuring Congress adopts a liability protection bill for businesses remains a priority issue for him.

“One of the things we’ve tried to convey to the Senate is please don’t trade off $2 trillion of debt for a weak-sauce liability protection,” Biggs said. 

The East Valley congressman says he’s spoken with senators who agree with him and he says that Senate Majority Leader Mitch McConnell is also committed to adoption of a liability protection bill. Biggs says what form such a bill takes will likely depend on what emerges from negotiations over the next Covid relief package.

Payroll tax relief 

Biggs says he agrees with the Trump administration and economists who believe that a payroll tax relief policy designed to help employers retain employees would continue to have a helpful stimulative effect on the U.S. economy and can be accomplished with manageable costs. 

Direct payments

Biggs breaks with the White House, however, on whether to issue another round of direct payments to Americans. 

Biggs says he would like to know whether data exists to indicate whether a previous round of payments was successful. 

“I have to ask those questions and find out as we look at this,” Biggs said.

The post Biggs urges fiscal restraint as Congress contemplates next Covid relief package appeared first on ���ϳԹ���.

If you are in charge of one of the nearly 5 million American companies that has received funds as part of the Paycheck Protection Program (PPP) or you are still planning to apply for a PPP loan, it’s important to be aware of the significant updates and changes to the program that come as part of the Paycheck Protection Program Flexibility Act (PPPFA), signed into law on June 5, 2020.

• First of all, if you are interested in applying for PPP funds and have not yet done so, new applications are being accepted again as of July 6, 2020, through August 8, 2020.
• Loan recipients now have 24 weeks instead of 8 to spend loan proceeds and still be eligible for forgiveness.
  • While this period has been extended, recipients are still able to apply for forgiveness starting at 8 weeks after receipt of funds.
• PPP proceeds are still calculated off of your business’s payroll expenditure and, as before, the funds are intended to be applied primarily to your payroll to, although the qualification for forgiveness has been reduced from 75% of funds spent on payroll to 60%.
  • Eligible expenses for the remaining portion of the loan remain the same (rent, mortgage interest, utilities); however, a new requirement that comes as part of PPPFA is that if 60% or less of the loan is spent on payroll, none of the loan will be eligible for forgiveness, and will revert to the repayment terms, below.
• The portion of the loan that is not eligible for forgiveness will still be subject to a 1% interest rate, but the repayment term for loans issued after June 5, 2020 has been increased from two to five years. Loans issued prior to June 5, 2020, will still have a maturity of two years, although borrowers and lenders may mutually agree to modify the maturity terms to conform with the PPPFA.
• Additionally, the deferral period for PPP loan repayment has been increased to six months after the SBA makes their forgiveness determination.
  • Currently, your PPP lender has 60 days to make their initial forgiveness determination, after which point the SBA has an additional 90 days to accept or adjust the lender’s determination. It’s only after this point that the 6-month deferral begins.
• PPPFA also extended the deadline to rehire workers and still have their salaries qualify for forgiveness, from June 30, 2020 to December 31, 2020. It also introduced a couple exceptions to this requirement, although it’s worth noting that documentation will need to be provided to demonstrate that good-faith, written offers to rehire workers were declined.
  • The exemptions include the inability to rehire a similarly qualified employee prior to the deadline OR an inability to return to the same level of business activity as prior to February 15, 2020 due to compliance with COVID-related restrictions.

As guidelines are regularly being clarified, for the most up-to-date guidance on PPP expectations/best practices borrowers should reach out to their lenders.

Mark Khazanovich is the director of operations at KORE Accounting Solutions, a future-focused management accounting firm specializing in providing legal professionals and business owners with the data and insights they need to stay compliant and run more profitable businesses.

The post Paycheck Protection Program Flexibility Act (PPPFA) brings updates for small business borrowers appeared first on ���ϳԹ���.

As the American economy wobbles under the outbreak of COVID-19, small businesses across the nation have a lifeline thanks to the Paycheck Protection Program (PPP). Despite this massive federal stimulus, however, private enterprise still faces slumped demand, reduced spending, and regulatory burdens. This has put a strain on wages and forced many long-standing local businesses to close their doors.

In light of these economic conditions, Wells Fargo has transformed its stated commitment to promoting small business into reality. Donating $400 million in PPP transfer fees “back to nonprofits serving the small business community,” Wells Fargo has led the industry in supporting job creators and workers alike.

Open for Business Fund

“Community Development Financial institutions (CDFIs), nonprofit lenders and special purpose funds formed by CDFIs with an emphasis on serving racially and ethnically diverse-owned businesses are encouraged” by the bank to apply for said funds. This is an integral part of Wells Fargo’s commitment to stimulating growth for all Americans, especially those who have been disproportionately excluded from economic opportunity in the past.

As the United States and the rest of the world continues to weather the Coronavirus pandemic, the future is still unclear. But Wells Fargo has assured its customers that “[a]dditional grant cycles around technical assistance and long-term resiliency and recovery” will be open in the  future.

PPP impact

Already, the PPP has benefited thousands of American small businesses directly. And many of those who have received assistance are loyal customers to the stagecoach lender. In fact, 84% of PPP loan recipients through Wells Fargo have been businesses with 10 employees or fewer.

The bipartisan stimulus has provided aid through lending institutions to over , totaling $511 billion. Small businesses employ nearly half of all American workers, thus providing them with the extra liquidity necessary to bridge this recession is viewed as a primary objective of lawmakers in Washington.

More information on the details of the CARES Act’s PPP can be found .

A recovery for all

As corporations and citizens across the United States reconsider their strategies to eliminate racism and foster equal opportunity, Wells Fargo has made sure that in keeping industry afloat, the most vulnerable communities’ needs are at the forefront of the process. 

In its statement on diversity and inclusion, Wells Fargo says it is  “committed to advancing diversity and inclusion by helping ensure that all people across our workforce, our communities, and our supply chain feel valued and respected and have equal access to resources, services, products, and opportunities to succeed.”

The post Wells Fargo commits $400 million to small businesses appeared first on ���ϳԹ���.

Thanks to a bipartisan bill introduced in the U.S. Senate last week, Arizona’s smallest companies that receive loans through the federal Paycheck Protection Program (PPP) could see paperwork requirements simplified to make it easier to access funds needed to keep their businesses operational. 

Arizona U.S. Senator Kyrsten Sinema, a Democrat, and North Dakota Senator Kevin Cramer, a Republican, introduced the bill in the Senate Banking Committee.

Called the Paycheck Protection Small Business Forgiveness Act, it would make loans that are no greater than $150,000 fully forgivable by filling out a one-page form. 

“Fully forgiving Arizona small businesses’ PPP loans provides needed economic certainty to local employers, which have suffered losses through no fault of their own, while protecting Arizonans’ jobs and paychecks,” Sinema said in introducing the legislation. 

The loans would be forgiven in full as long as the borrower submits a one-page form that attests that the recipient complied with the requirements of the PPP program as described in the economic stimulus legislation passed earlier this year, known as the CARES Act.

Bill would relieve paperwork burden for 85 percent of loans

The co-sponsors of the bill including Bob Menendez, D-NJ, and Thom Tillis, R-NC, said the legislation would save small companies thousands of dollars and relieve their paperwork burdens. 

It also would provide avenues for enforcement action against those engaged in fraud, and allow the U.S. Small Business Administration (SBA) to focus its compliance resources on higher value loans.

The approximately 3.7 million PPP loans of $150,000 or less account for 85 percent of all PPP approved loans but only 26 percent of the funds delivered, the co-sponsors said.

The cost of applying for forgiveness for a PPP loan of this size is $2,000 for the small business and $500 for the lender. The bipartisan legislation could save small businesses $7.4 billion and banks nearly $2 billion, they said.

National banking groups support the bill 

The legislation is supported by state and national banking and agricultural groups including the Independent Community Bankers Association, Credit Union National Association and Farm Credit Council. 

“The current forgiveness application is unnecessarily burdensome for many businesses, particularly the smallest of small businesses without the administrative support needed to complete the form. Small businesses and their employees are the backbone of our nation’s economy and communities,” said Consumer Bankers Association President and CEO Richard Hunt in a statement last week. “This bipartisan automatic forgiveness process will allow businesses to focus their time and resources on seeing customers and hiring employees instead of hiring consultants to fill out paperwork.”

Measures included in the Paycheck Protection Small Business Forgiveness Act:

-Provides forgiveness for PPP loans of $150,000 or less if the borrower submits a simple, one-page attestation form to the lender 

-Ensures the lender will be held harmless from any enforcement action if the borrower’s attestation contained falsehoods

-Eligible recipients of the loans may only be subject to an enforcement action or penalty  they commit fraud or expend loan proceeds on expenses that are not allowable the actTo read the fill text of the bill, go to: .

The post Bill would provide smallest companies easier access to PPP loans appeared first on ���ϳԹ���.

The Paycheck Protection Program Flexibility Act (PPPFA) was signed into law last week, giving greater flexibility to the program that provides COVID-19 relief aid to small businesses.  

The measure was a refreshing display of bipartisanship. The House on May 27  passed the PPPFA by 417-1, the Senate approved it by unanimous consent on June 3 and President Trump swiftly signed PPPFA on June 5. 

Although there was disagreement in the Senates about some of the House bill language, the Senate opted to approve the measure and then apply changes.  

Senator Ron Johnson, R-Wis., blocked an initial attempt at unanimous consent because he wanted clarification on the language regarding the extension of the program’s extension to December 31. Sen. Johnson opposed the extension of the program and received a letter clarifying that the PPP extension to December 31, 2020 only applies to rehiring employees and not the program’s application deadline. 

Senate Small Business and Entrepreneurship Chairman, Senator Marco Rubio, R-Fla., and Senator Susan Collins, R-Maine, are working on technical changes, particularly the language that creates a cliff for loan forgiveness linked to payroll spend. The current language disqualifies small businesses who spend less than 60% of their PPP loan from loan forgiveness altogether.  

There are several important changes that PPP loan recipients should be aware of:

1. Payroll spend requirement lowered to 60% 

The percent of funds that must be spent on payroll was lowered from 75% to 60%, to be eligible for at least some loan forgiveness. But there also is now a cliff; payroll spend below 60% prevents any loan forgiveness. In addition, the list of eligible expenses does not change (rent, mortgage, utilities, and interest on loans). 

2. Time period to use funds extended to 24 weeks

Recipients now have 24 weeks to spend funds from the time of origination, to be eligible for at least some loan forgiveness. This is up from the original eight weeks. What is more, small businesses do not have to wait for 24 weeks to apply for forgiveness, they can still do so 8 weeks after. 

3. Deadline to rehire workers extended to December 30, 2020

Originally, small businesses were required to rehire workers by June 30, 2020 in order for their salaries to qualify for forgiveness, but under PPPFA that deadline has been extended and their salaries will qualify if the new deadline is met.

4. Loosens hiring requirements

PPPFA states that a business can still receive forgiveness on payroll amounts if it meets any of the following criteria:Is unable to rehire an individual who was an employee of the eligible recipient on or before February 15, 2020;

1. Is able to demonstrate an inability to hire similarly qualified employees on or before December 31, 2020; or

2. Is able to demonstrate an inability to return to the same level of business activity as such business was operating at prior to February 15, 2020.

3. New guidance from the Small Business Administration (SBA) will be needed to elaborate on how to document these exceptions. 

5. Extends loan repayment from 2 to 5 years

A business now will have five years at 1% interest to repay the loan and the first payment will be deferred for six months after the SBA makes forgiveness determination. Currently, banks have 60 days to make a forgiveness determination and the SBA an additional 90 days, which means small businesses could have up until May of 2021 to make the first payment on their PPP loan.

6. Deferment of payroll taxes for social security 

PPPFA now allows borrowers to take advantage of the CARES Act provision allowing deferment of the employer’s payroll taxes for social security on the forgivable portion of the loan.  

PPPFA addresses many of the concerns raised by the small business community. Once important technical changes are applied by Sen. Rubio and Sen. Collins, PPPFA will go a long way to ensuring small businesses have greater flexibility to use their PPP loan and maximize their loan forgiveness. With funding still available through PPP, these changes could instill confidence and encourage more small businesses to apply for the program.

Laura Ciscomani serves as the Development Director for the Arizona ���ϳԹ��� Foundation and the Arizona ���ϳԹ��� of Commerce and Industry.

The post Paycheck Protection Program Flexibility Act Passes with Bipartisan Support appeared first on ���ϳԹ���.

In less than six weeks, Arizona banks have succeeded in processing billions of dollars in forgivable loans for small businesses through the new federal Paycheck Protection Program (PPP). The program is designed to help businesses retain employees by keeping them on the payroll during the pandemic or recalling them from furlough. 

The most recent figures show that almost $8.9 billion in loans have been approved in Arizona in the first two rounds so far, according to the U.S. Small Business Administration (SBA). The second round is still open and accepting. 

Banks in Arizona of all sizes have had the daunting task of fielding the crush of applications and processing hundreds of millions of dollars in loans. 

Among the largest banks in the push to get these loans processed are Bank of America and JP Morgan Chase. In round two that started April 27, these two banking giants have secured over $1 billion in loans for small businesses in Arizona. 

With the second round still in , and a possible third round on the way, they’re not stopping. 

“We continue to receive and process new applications. We are happy to see the SBA has been processing submissions at a faster rate, and hopefully there is sufficient funding for everyone in need,” said Dean Athanasia, head of Consumer and Small Business at Bank of America.

Bank of America top lending bank for PPP second round

Bank of America has been the country’s number 1 lending bank in the second round of the PPP program, company officials said. During round two, the bank has approved loan applications for more than 265,500 small businesses, representing $24.9 billion in needed relief.

In Arizona, the bank has accepted more than 9,200 applications from businesses worth more than $684 million, with an average loan amount of $85,300. About $450 million in loans have been secured for more than 6,800 businesses. 

Over 7,300 of these applications are from Phoenix-area businesses, and 5,420 have been funded with an average loan amount of $67,600, according to the bank.

Almost all applications — 98 percent — came from companies with 100 or fewer employees. Nearly a fourth came from low-to-moderate income neighborhoods.

JP Morgan Chase loans support 3 million employees nationwide 

During round two, Chase received approval for 211,000 loans, totaling about $15 billion for its small business customers across the U.S. In total, the firm expects to fund about $29 billion in the grants to over 239,000 businesses from the first two rounds, helping to support 3 million employees. 

In Arizona, Chase has secured $1.2 billion for 10,500 businesses since the inception of the PPP. The average loan size has been $116,000.  

About 50 percent of the loans went to companies with fewer than five employees. Over 75 percent of the loans were for under $100,000.

It’s been an intense several weeks, said Chairman and CEO Jamie Dimon.

“Thousands of dedicated JPMorgan Chase technologists, bankers and others worked tirelessly  to support the federal government in one of the largest and most ambitious emergency lending facilities in history,” Dimon stated. 

Smaller Arizona Federal Credit Union secures $44 million for companies 

Smaller banks have been working tirelessly as well.

Arizona Federal Credit Union’s small business loan department, received more than 500 requests in 72 hours when the loan program first kicked off in early April, said COO Jason Paprocki.

As of Tuesday, the credit , which has 130,000 member-owners, has funded 435 PPP loans for $43.8 million, with about another 80 applications being processed. It expects the total loan amount to exceed $45 million. 

One of the drivers was their acquisition of Scottsdale-based Pinnacle Bank that was already an SBA approved lender and Arizona Federal was able to jump in and help navigate the process quickly, Paprocki said. 

In the end, the loans were able to keep 168 businesses, and countless employees receiving paychecks, he said. 

“One of our members who owns a construction company called to thank us and let us know they were down to their last $3,500 until the PPP funds hit and they were able to keep 60 employees paid and at work,” says Paprocki. “That sort of story just reminds us that these are not just numbers on paper, but people’s livelihood at stake and we are just thankful to have the opportunity to help.”

Keeping workers connected with employers is the goal 

The PPP loan program was made possible through the CARES Act that was passed by Congress in response to the pandemic to provide fast and direct economic assistance for American workers and families and small businesses and preserve jobs for American industries.

Congress approved a total $659 billion dollars for the first two rounds of the PPP program. 

The loans are intended to act as an incentive for small businesses to keep their workers on the payroll. As long as companies follow the guidelines required, the loans are treated like grants. 

Under the rules, at least 75 percent of the money must be used for payroll. The rest is to be used for operating costs like utilities and rent. 

Who’s eligible? 

Small businesses with 500 or fewer employees that have been impacted by the pandemic are eligible. That includes sole proprietorships, independent contractors, self-employed persons, private non-profit organizations, and nonprofit veterans organizations that were in operation before Feb. 15, 2020.

Businesses in certain industries may qualify even if they have more than 500 employees if they meet the for those industries. Small businesses in the hospitality and food industry with more than one location could also be eligible if their individual locations employ less than 500 workers.

���ϳԹ���s of commerce across the state are offering their assistance and resources to affected businesses wanting to apply.

The Arizona ���ϳԹ��� of Commerce & Industry also has joined forces with the Arizona Small Business Association (ASBA) to launch the CARES Act Readiness Program for Small Businesses, a free online training to help any small business access the capital they need.

More information is available at , or in Spanish atl. Further guidance and information on SBA programs for COVID-19 relief can be found at .

The post Arizona banks process billions of dollars in forgivable loans during pandemic appeared first on ���ϳԹ���.

As Gov. Doug Ducey continues to deliver new guidance for the reopening of the Arizona economy and as Arizona prepares to return stronger, new data from the Small Business Administration indicates the state’s small businesses are accessing an important economic lifeline.

According to the SBA, nearly 44,000 Arizona small businesses have been approved for $3.7 billion in loans in the latest round of the Paycheck Protection Program, placing the state within the top 15 for both number of businesses and funds approved.

Combined with the first round of funding, that means more than 63,000 small businesses in Arizona have been approved for over $8.5 billion in PPP loans.

PPP funds are designed to help businesses keep employees on the payroll, to make rent payments and pay utilities. Most loans are forgivable, meaning the program acts more like a grant than a loan.

If your business has not yet been approved or if you have not yet applied, it is estimated that $135 billion in funds still remain, so qualified businesses are urged to apply as soon as possible.

The Arizona ���ϳԹ��� of Commerce & Industry is here to help. We have joined forces with the Arizona Small Business Association (ASBA) to launch the CARES Act Readiness Program for Small Businesses, a free online training to help small businesses access the capital they need. We’re also proud to count the SBA Arizona District Office and Arizona Commerce Authority as partners.

And better yet, the training program is completely free, and is designed to help both novice and experienced borrowers successfully access relief funds. The overall goal of the program is to increase access to relief funds throughout Arizona by providing the training in both English and Spanish.

In this same vein of access, a partnership was formed with Acronis #CyberFit Financing and Lendio to help those small businesses with limited lending options. Lendio is a free online marketplace that streamlines the SBA application process for eligible small businesses to access relief funds and provides other lending options through its network of over 75 lenders offering multiple loan products for small businesses.

Options like Lendio have proved essential to small businesses participating in the CARES Act Readiness Program, especially those from underbanked communities in Arizona.

Participants are already reporting positive results through our program, and we’re looking forward to many more Arizona small businesses getting the information and training they need not only to keep their doors open, but to continue to thrive.

More information is available at, or in Spanish at. To partner with us to amplify this program in your network, please contact Laura Ciscomani at lciscomani@azchamber.com.

Laura Ciscomani is the Director of Development for the Arizona ���ϳԹ��� of Commerce & Industry

The post CARES Act Readiness Program helping Arizona small businesses access economic lifeline appeared first on ���ϳԹ���.