Coronavirus Government Assistance Programs Information
The VBA has developed this page of resources to help keep Virginia banks informed.
SBA/PPP Information & Key PPP Updates
Link to PPP page on SBA website, which includes:
- Loan Details
- Loan Forgiveness
- Who Can Apply
- Lender Forms and Guidance
- Program Data
- Other Assistance
March 30, 2021 – SBA Outlines process for ppp lenders to clear h ld codes, error messages
Under the newly issued procedural notice, SBA clarified that the borrower must certify the information used to resolve the hold code or error message. Specifically, lenders may resolve certain hold codes and error messages “by obtaining a written borrower certification along with supporting documentation of the type identified for each Hold Code or Compliance Check Error Message in the First Revised Hold Code Notice.” Once obtained, “the Lender may execute the updated certification within the Platform,” SBA said. “The Lender must retain the borrower’s written certification and supporting documentation in its file and must provide them to SBA as indicated in the Lender Certification.” Once the process is complete, the PPP platform will “automatically move the loan guaranty application to the next stage of loan processing.”
With the window for PPP applications extended by Congress through May 31, SBA said it “has obtained a validated machine learning scoring model” that allows it to process automatically first-draw PPP loans with “minimal risk of noncompliance with eligibility requirements, fraud, or abuse.” Once deployed, SBA said the number of first-draw PPP hold codes would be “significantly reduced.” SBA added that lenders will know the model is deployed when the loan subject to a hold receives an SBA loan number.
Meanwhile, SBA said it would remove error messages indicating a disqualifying criminal history or delinquent or defaulted federal student loan, based on changes announced by the Biden administration to expand PPP loan access. ABA and the state bankers associations have been advocating for SBA to address the hold codes and error messages to ensure loans are processed before PPP funding lapses.
March 18, 2021 – SBA Issues Interim Final Rule Implementing PPP Changes
The Small Business Administration issued an interim final rule implementing changes to the Paycheck Protection Program that were included in the American Rescue Plan law enacted earlier this month. The IFR will take effect upon publication in the Federal Register.
Among other things, the IFR changes the interplay between the Shuttered Venue Operator Grant Program and the PPP. Under the IFR, borrowers who received a first- or second-draw PPP loan after Dec. 27, 2020, and have been subsequently approved for an SVO grant will have the SVO grant reduced by the amount of the PPP loan. If a PPP applicant is approved for an SVO grant before SBA issues a loan number for the PPP loan, the applicant is ineligible for the PPP loan and acceptance of any PPP loan proceeds will be considered an unauthorized use.
In addition, the IFR makes several clarifications and changes, including:
- The addition of businesses with an NAICS code beginning with 72 that employ no more than 500 employees per physical location to the list of entities eligible for first-draw PPP loans.
- A clarification that electric cooperatives and telephone cooperatives are eligible if they have no more than 300 employees per physical location.
- A clarification that electric cooperatives and telephone cooperatives are no longer permitted to use the employee-based SBA size standard for their industry or SBA’s alternative size standard to determine size.
- Additional detail on the types of payroll costs that are not eligible for loan forgiveness.
- Read the IFR.
SBA Adjusts PPP Payroll Calculation For Form 1040, Schedule C Filers
The IFR released on 3/3/2021 allows individuals who file an IRS Form 1040, Schedule C to calculate their maximum loan amount using gross income.
The IFR also stated that this calculation change will apply only to loans approved after the rule’s effective date. Borrowers that have already had their loans approved cannot increase their PPP loan amount based on the new maximum loan formula.
Additionally, businesses electing to use gross income to calculate their first-draw PPP Loan will only have a safe harbor presumption of making the necessary certification of economic necessity if they reported $150,000 or less in gross income on their Schedule C being used to apply for a first-draw PPP loan. Borrowers with reported gross income greater than $150,000 will be subject to additional SBA review.
Finally, the IFR removes a restriction on business at least 20% owned by an individual who was arrested for or convicted of a felony related to financial assistance fraud in the previous five years or any other felony within the previous year from obtaining PPP loans. It also removes a restriction on businesses at least 20% owned by an individual who is delinquent on student loan from receiving PPP loans.
- Read the IFR.
- Access the new first draw application form.
- Access the new second draw application form.
- Access the first draw Schedule C gross income form.
- Access the second draw Schedule C gross income form.
- Access the lender first draw form.
- Access the lender second draw form.
Measures to Target PPP Loans to Smallest Firms Administration
Firms with Under 20 Employees to Have Exclusive Application Period Starting Wednesday, February 24th
The White House announced on Monday, February 22nd several measures to ensure the smallest firms have access to Paycheck Protection Program loans, including an exclusive application window for firms with fewer than 20 employees, a revised loan calculation and funding set-aside for sole proprietors and self-employed individuals and new eligibility for businesses owned by those with certain felony convictions. Five weeks after the PPP reopened, roughly $150 billion—more than half of the amount authorized for the 2021 round of PPP—remains available. The current round of funding expires on March 31st.
Specifically, the White House said that the Small Business Administration would:
- Provide an exclusive 14-day window, starting Wednesday, February 24th, when only businesses with fewer than 20 employees are eligible to apply.
- Set aside $1 billion for PPP loans for sole proprietors, independent contractors and self-employed individuals in low-to-moderate-income areas and revise the loan calculation formula for these applicants. (According to press reports, the revised formula would only be available to new applicants, not retroactive.)
- Eliminate a rule restricting businesses at least 20% owned by an individual who was arrested for or convicted of a felony related to financial assistance fraud in the previous five years or any other felony within the previous year; the restriction will only apply to businesses with applicants or owners who are incarcerated from receiving PPP loans.
- Eliminate a rule restricting businesses at least 20% owned by an individual who is delinquent on student debt from receiving PPP loans.
- Clarify that non-citizens may apply using individual taxpayer identification numbers.
Updated Borrower and Lender Guaranty Applications for Both First-draw and Second-draw PPP Loans
- SBA FAQs – March 15, 2021
- Read the guidance on first-draw loan calculations.
- Read the guidance on second-draw loan calculations.
- Download the borrower disclosure
- Top-line Overview of PPP First Draw Loans
- Top-line Overview of PPP Second Draw Loans
- Download the borrower application for first-draw loans
- Download the lender guaranty form for first-draw loans
- Download the borrower application for second-draw loans
- Download the lender guaranty form for second-draw loans
Other Key PPP updates, as of February 11, 2021:
- SBA Notice on PPP Loan Error Codes
- SBA Procedural Notice Addressing Second-Draw Loans:
- Read the PPP procedural notice.
- Read the 7(a) notice.
- Read the 504 fee notice.
- Read the borrower assistance notice.
- Read the information notice – update on the tax treatment of payments made to borrowers to cover principal, interest and fees on certain 7(a), 504 loans and microloans under Section 112 of the CARES Act.
- Lenders with $1 Billion* or Less in Assets Will be Able to
Submit First and Second Draw PPP Applications on January 15 –
Continuing Dedicated Access for Community-Based Lenders
*Please note that the $1B threshold is as of the 12/31/19 call report
- PPP borrowers can set their PPP loan’s covered period to be any length between 8 and 24 weeks to best meet their business needs;
- PPP loans will cover additional expenses, including operations expenditures, property damage costs, supplier costs, and worker protection expenditures;
- The Program’s eligibility is expanded to include 501(c)(6)s, housing cooperatives, direct marketing organizations, among other types of organizations;
- The PPP provides greater flexibility for seasonal employees;
- Certain existing PPP borrowers can request to modify their First Draw PPP Loan amount; and
- Certain existing PPP borrowers are now eligible to apply for a Second Draw PPP Loan.
PPP Forgiveness information
- Interim Final Rule on PPP Forgiveness – 1/20/2021
- Download Form 3508
- Download Form 3508EZ
- Download Form 3508S
EIDL Advance Reconciliation Payments Information
SBA will begin remitting reconciliation payments beginning Feb. 9 through Feb. 19 for any with an SBA forgiveness payment that was reduced by the amount of an Economic Injury Disaster Loan advance. The amount of the reconciliation payment will be equal to the previously-deducted EIDL advance amount, plus interest through the remittance date. SBA will use the interest accrual method currently identified in the Forgiveness Platform.
Lenders must notify borrowers of the reconciliation payment, and that they are responsible for re-amortizing the loan. Lenders must also notify the borrower of either the amount of the next payment due, or that the loan has been paid in full.
SBA Points of Contact
Payment Protection Program:
- PPP Hotline: (833) 572-0502 for:
- PPP questions and procedures
- Live assistance regarding SBA Paycheck Protection Platform access and support
- Capital Access Financial System (CAFS) and SBA’s Electronic Transmission (E-Tran) systems support
- SBA Paycheck Protection Platform
- SBA Paycheck Protection Platform Inbox (accessed within the
- Loan-specific inquiries
- General PPP support
- General Platform functionality
- Platform access
- Policies and procedures
- Loan review
- Payment reconciliation
- General correspondence
- If unable to access the SBA Paycheck Protection Platform inbox:
- E-Tran and CAFS – questions and technical support: email@example.com or 833-572-0502 or SBA Paycheck Protection Platform inbox
Regular SBA Business Loan Programs:
- 7(a) Loan Program: Contact your SBA District Office; or 7aQuestions@sba.gov
- 504 Loan Program: Contact your SBA District Office; or 504Questions@sba.gov
- Microloan Program: Contact your SBA District Office; or Microloans@sba.gov
SBA Lenders & Public:
- Questions on PPP, 7(a), Microloans, or 504 Loan Programs: Contact your SBA District Office
- PPP Public Documents & Guidance:
PPP Information – Treasury and
PPP Information – SBA
- Office of Disaster Assistance (Disaster/EIDL):
- Comments on PPP interim final rules: https://www.regulations.gov or, only if including confidential business information: firstname.lastname@example.org
- General questions: DisasterCustomerService@sba.gov or 800-659-2955
- For subordination of collateral with EIDL: PDC.AccountsCollateralReview@sba.gov
Recently Released SBA/PPP Guidance & SAM.gov Information
- SBA Guidance on PPP Processing Fees
- PPP FAQs – as of 1/29/2021
- Shuttered Venue Operators Grants FAQs – as of 1/29/2021
- Guidance on maximum loan size calculations
- Notice on forgiveness
- Notice on excess loan errors
- SBA FAQs on Revenue Reduction, Max Loan Amount Calculations for Second-Draw PPP Loans - as of 1/19/2021
- PPP Guidance from SBA Administrator Carranza on Accessing Capital for Minority, Underserved, Veteran, and Women-Owned Business Concerns
- Interim Final Rule on Paycheck Protection Program as Amended by Economic Aid Act
- Interim Final Rule on Second Draw PPP Loans
- View the recording from recent VBA Update with ABA’s James Ballentine and Dan Martini
SAM.gov Information & Key Updates
According to SBA, lenders that were previously making PPP loans do not need to re-register with SBA to make first-draw or second-draw loans in this round of funding, although all participating lenders must register on SAM.gov. This requirement comes directly from IFR#1, which provides, in part:
“2. Do lenders have to register in SAM.gov to make PPP loans?
Yes. Given the exigent circumstances in which small businesses and lenders currently find themselves due to the COVID-19 pandemic, PPP lenders will have thirty (30) days from the date of the first PPP loan disbursement made by them after December 27, 2020 to complete SAM registration and provide SBA with the lender’s unique entity identifier.”
Footnote  further provides “This subsection adds a new requirement that all PPP lenders must register in SAM.gov. See 2 CFR 25.110(c)(2)(iii).” The regulations at 2 CFR 25.110(c)(2)(iii)further provide:
“(iii) For an applicant, if the Federal awarding agency makes a determination that there are exigent circumstances that prohibit the applicant from receiving a unique entity identifier and completing SAM registration prior to receiving a Federal award. In these instances, Federal awarding agencies must require the recipient to obtain a unique entity identifier and complete SAM registration within 30 days of the Federal award date.”
- Read the procedural notice on lender registration.
- View the platform user guide.
- View the API technical information.
It is noted that the registrations in SAM.gov does require someone at the lender register as a user so they may add the lender to SAM.gov, and also make changes as necessary after registration of the lender in SAM.gov. Usually, this is done at an corporate office level and usually not done by the small business lending or commercial credit staff of the lender. There is no charge to register or become a registered user in SAM.gov.
Second, SBA SOP 50 10 6 requires the SBA Lender to consult the SAM.gov Exclusions to determine if any Agents involved in the loan process, or Associates of the small business Applicant have been suspended, debarred, revoked, or otherwise excluded by SBA or another Federal agency, and document the loan file with “screen shots” from their search results. (see SOP 50 10 6 Part 2, Section A, Ch. 5, Para. B., beginning on page 170). This verifications is done for every SBA loan. SAM.gov does not require anyone to register in order to perform a search of the SAM Exclusions listing. This search is also done at no charge to the user.
Third, Lenders are also are required to verify all employees of the lender (including agents of the lender, including LSPs)) are not in the SAM.gov Exclusion listing as well, and that check is usually done at the hiring or onboarding of the of the employee or Agent, and the documentation kept in the lenders records for review at anytime by SBA. This is a one-time verification of the Lender’s employees (including Agents and LSPs) involved in any way with the SBA loan process (from generation, closing, servicing, and liquidation. Again, SAM.gov does not require anyone to register in order to perform a search of the SAM Exclusions listing. This search is also done at no charge to the user.
Economic Impact Payment Information
To help bankers prepare for this third round of payments and to complement the IRS FAQs, ABA has updated its backgrounder on EIPs, as well as a set of talking points they can reference when fielding questions from customers and the media.
- Read the IRS announcement – March 12, 2021.
- Read the IRS FAQs – March 12, 2021.
- Access Get My Payment.
Last month, Governor Ralph Northam allocated an additional $20 million in federal CARES Act funding to the Rebuild VA economic recovery fund to meet demand for the program and fulfill pending grant applications. This new funding will bring the program total to $120 million and will enable more than 300 small business and nonprofit organizations that applied before the last round of funding was exhausted in early December to receive grants. In December, Governor Northam announced that Rebuild VA had fully committed the $100 million in federal funds previously allocated to the program, which provided grants to 2,500 small businesses and nonprofits whose normal operations were disrupted by the COVID-19 pandemic. To date, Rebuild VA has received nearly 20,000 applications and the average grant award was $35,636. You can read the full release here.
VBA Partner Resources
Abrigo has begun supporting community financial institutions participating in the latest round of PPP through its Sageworks SBA Lending solution. Customers leveraging the solution can simplify and automate the underwriting processes of PPP so you can quickly get money into the hands of small business owners. Learn how you can get implemented and begin automating PPP loans within 48 hours.
- January 11th Webinar Recording – What’s Changed with PPP in 2021
- PPP Live Demo – Abrigo will be adding additional times/dates frequently
- Blog post – Lender guidance for borrowers wanting a second loan
Compliance Alliance has put together new tools and resources as you prepare for PPP re-opening. You can find all of these resources here. Resources include:
- C/A Summary of IFR Paycheck Protection Program as Amended by Economic Aid Act
- C/A Summary of SBA Procedural Notice: Modifications to SBA Forms 3506, 3507 and 750 CA (PPP)—
- C/A Summary of SBA Procedural Notice: Repeal of EIDL Advance Deduction Requirement for SBA Loan Forgiveness Remittances to PPP Lenders—
- Paycheck Protection Program Tracker
- C/A Summary on SBA FAQ: How to Calculate Maximum Loan Amounts for First Draw PPP Loans
- C/A Summary of SBA Procedural Notice: Resubmissions of Loan Forgiveness Applications, Lender Notice Responsibilities, and Offset of Remittances
- C/A Summary of SBA Procedural Notice: Excess Loan Amount Errors
- Link to SBA Loan Forgiveness Application—Form 3508S (1.19.2021)
- Link to SBA Loan Forgiveness Instructions—Form 3508S (1.19.2021)
- Link to SBA Loan Forgiveness Application—Form 3508EZ (1.19.2021)
- Link to SBA Loan Forgiveness Instructions—Form 3508EZ (1.19.2021)
- Link to SBA Loan Forgiveness Application—Form 3508 (1.19.2021)
- Link to SBA Loan Forgiveness Instructions—Form 3508 (1.19.2021)
- Link to SBA Form “Borrower’s Disclosure of Certain Controlling Interests” 3508D
Compliance Alliance Huddles & Recordings
The following Huddle recordings can be found here.
- January PPP Huddle 2021 (recording)
- PPP Compliance Huddle 01/20/21 (recording)
VBA Media Relations & Resources
- VBA Newsroom – read recent VBA press releases and articles
- VBA In the News – read recent mentions of VBA and VBA member banks in the news
VBA MEMBER BANKS TWITTER LIST
The VBA has put together a list of our member banks on Twitter. This is a finely-curated feed of all our member banks’ Twitter profiles, which displays only the tweets from those organizations. This is a great resource for viewing what other banks are doing and sharing at this truly unique time. Please be sure to pass this tool along to your marketing team. Don’t see your bank’s Twitter handle on the list? Email Chandler Owdom to be added to the list.