MONTGOMERY, Ala. — The Department of Treasury and Small Business Administration (SBA) has released an interim final rule on the Paycheck Protection Program (PPP).
“Farmers and agribusinesses feed America and this program can provide some much-needed relief for our producers based on eligibility. I encourage them to get started on the application now," says Commissioner of Agriculture and Industries Rick Pate.
Financial institutions, including the Farm Credit system, will be responsible for processing loan applications and administering the loan. Loans are subject to SBA’s affiliation rules.
Agricultural producers are eligible to participate in the program and should reach out to their bankers and/or agricultural lenders to apply immediately. There are some administrative details SBA needs to confirm, but be aware that the loans will be provided on a first-come, first-served basis.
Eligible businesses include:
- Limited liability companies (LLC)
- S corporations
- sole proprietorships
- contractors
- non-profits with 500 or fewer employees
Loans are:
- capped at $10 million
- can include up to eight weeks of average monthly payroll costs from last year plus an additional 25% of non-payroll costs
- have an interest rate of 1%
- mature in two years with loan payments being deferred for the first six months
- loan amounts are calculated based on the payroll costs for all employees
- will be fully forgiven if at least 75% of the funds are used for payroll costs, and the remainder is used for interest on mortgages, rent, and utilities
- forgiveness is also based on the employer maintaining, or quickly rehiring, employees at the same salary level
The PPP will be available through June 30, 2020. For questions on the PPP contact Lender Relations at your local SBA Field Office.
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