January 13, 2021

Dear friends,

Despite the upheaval in our nation’s capital, there is some good news from Washington. There’s a lot of detail, but hang with us for these important updates!

New PPP Funding - Apply through March 31, 2021

The Paycheck Protection Program (PPP) re-opened on January 11 for new borrowers. PPP is a federal loan that can be forgiven if used for payroll and other eligible expenses. Some existing PPP borrowers can also request to change their loan amount or apply for a second loan. 

Key PPP updates include:
  • Housing cooperatives with payroll expenses and small news organizations are now eligible;
  • Expanded forgivable expenses, including property damage, supplier costs, and worker protection (PPE);
  • Maximum loan is still 2.5 times average monthly payroll costs, up to $2 million. Food service and accommodations have a maximum forgivable loan of 3.5 times average monthly payroll costs;
  • Greater flexibility for seasonal employers; and
  • Covered period can be any length between 8 and 24 weeks to best meet your business needs.

You may be eligible for a Second Draw PPP Loan if you:
  • Already received a First Draw PPP Loan and will or have used the full amount only for authorized uses; and
  • Can show at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.

To get started, download the PPP First Draw Borrower Application Form or Second Draw Borrower Application Form. Please reach out to us if you need assistance with either application, or if you have questions about your co-op’s eligibility.

If your co-op already received a PPP loan, re-applying through the same lender will streamline your application process. If you did not receive a loan in the first round, feel free to contact us if you need help finding a lender. While we are not a PPP lender, we may be able to connect you with other co-op friendly providers. 

As part of our commitment to strengthen the BIPOC small business support ecosystem, CFNE is again sharing our financial know-how as part of the Equitable PPP Access Initiative. This coalition aims to improve forgivable loan access for businesses left behind by banks and policymakers.


Forgiveness and Tax Updates

Some changes in the Economic Aid Act will benefit current PPP borrowers, as well as new borrowers:
  • Any loan forgiveness under the PPP does not qualify as gross income. 
  • Forgiven expenses are deductible for tax purposes (overriding previous rulings).
  • EIDL advances will not reduce the amount of PPP forgiveness. (According to the SBA, there will be a way to "make whole" any borrowers who already applied for forgiveness and had the EIDL advance deducted.)
  • Employers can take advantage of both PPP and the Employee Retention Credit (ERC), as long as they are not both applied to wages for the same period.


Economic Injury Disaster Loan (EIDL) & Advance

The EIDL program was extended and the advance program fund was replenished. Businesses cannot receive a second EIDL. There will be a way for borrowers in low-income communities to receive the full $10,000 advance if they received less originally. The SBA plans to update its application portal by Jan. 17th, so stay tuned for details.


Hiring Deadline Extended

CFNE is excited to be adding a Communications Manager to our virtual, New England-based team. To attract a more diverse pool of applicants, we’ve extended our priority deadline to January 15, 2021. Please help us by sharing this opportunity widely. Full description and benefits on our website.

2021 is already full of surprises, but New England’s co-ops can count on CFNE’s continued support. We will be launching new opportunities for education, movement-building, and networking. As always, feel free to reach out if we can be of help.
In cooperation,
Micha Josephy
Executive Director
Cooperative Fund of New England www.coopfund.coop