City of Milpitas – Office of Economic Development
Paycheck Protection Program Flexibility Act of 2020
Dear Business Representatives,

Last week, we informed you that there was more than $120 billion in Paycheck Protection Program (PPP) aid still available to business owners. On Friday, June 5, President Trump signed into law H.R. 7010 - the Paycheck Protection Program Flexibility Act (PPPFA). The PPPFA changes improve several provisions in the original PPP loan program enacted as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Overall, the PPPFA provides flexibility to borrowers attempting to maximize the benefits provided by the PPP, especially small businesses who need more assistance and flexibility.

The PPPFA provides the following key changes to the PPP loan program:

- Extends the time to spend PPP loan proceeds from 8 to 24 weeks or December
31, 2020, whichever is earlier. 

- Reduces the percentage of the PPP loan proceeds that must be spent on payroll
costs from 75 percent to 60 percent.

- Extends the time to rehire employees and restore wages from June 30 to
December 31, 2020. 

- Provides up to 10 months after the PPP loan period ends to apply for loan

- Continues availability of payroll tax deferral regardless of loan forgiveness.

- Extends the repayment term on new PPP loans originated on or after June 5 from
2 years to 5 years. 

- Extends the deadline for applying for a PPP loan from June 30 to December 31,
2020, subject to the availability of PPP loan funds. 

PPP loans can still be used only for the following four categories of expenses:

- Payroll costs, including benefits;

- Interest on mortgage obligations, incurred before February 15, 2020;

- Rent, under lease agreements in force before February 15, 2020; and 

- Utilities, for which service began before February 15, 2020. 

If you have any questions or need business assistance during COVID-19, please do not hesitate to contact the Office of Economic Development team by sending a message anytime to

In community spirit,

Alex Andrade
Economic Development Director
Phone: (408) 586-3046  Email:
455 E. Calaveras Blvd., Milpitas CA 95035