In the last hour, the Small Business Administration (SBA) issued updated guidance regarding the Paycheck Protection Program (PPP), specifically on the safe harbor date. This date is the final day to return PPP loans considering new guidance that the government will consider a business’s “ability to access other sources of liquidity”. This was not clearly defined, which NLBMDA felt was unacceptable for dealers.
Originally set at May 7
, NLBMDA has been lobbying SBA and the Department of the Treasury to move the safe harbor date, and called for new guidance. We are pleased to report that SBA’s
granted both requests. The relevant section is below:
FAQ #31 reminded borrowers to review carefully the required certification on the Borrower Application Form that “[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.” SBA guidance and regulations provide that any borrower who applied for a PPP loan prior to April 24, 2020 and repays the loan in full by May 7, 2020 will be deemed by SBA to have made the required certification in good faith. Is it possible for a borrower to obtain an extension of the May 7, 2020 repayment date?
: SBA is extending the repayment date for this safe harbor to May 14, 2020. Borrowers do not need to apply for this extension. This extension will be promptly implemented through a revision to the SBA’s interim final rule providing the safe harbor. SBA intends to provide additional guidance on how it will review the certification prior to May 14, 2020.
NLBMDA thanks all members for their grassroots efforts over the past 12 hours and will communicate further as soon as the additional guidance mentioned in SBA's response is released.
For questions, please contact NLBMDA Director of Government Affairs, Kevin McKenney at