This is a critical week for businesses looking to stay afloat amid the pandemic. We are stretching your dollar with a deadline approaching that could impact which businesses survive the turbulent economy.
It’s the last week of May and as we approach June, we’re also coming up on an important deadline – the end of the eight-week window that businesses were given after accepting money through the payroll protection program, or PPP.
“As businesses have gotten the PPP, they are unable in some cases to be able to use it in the way that it’s structured,” David Lewis, CEO of Operations Inc. says
Operations Inc. is a human resource outsourcing and consulting firm. He says businesses have been struggling to spend the money effectively under current guidelines to avoid having to pay it back. But Congress is considering an amendment that could not only give them more time to spend it but also spend it more freely on business-related expenses.
“So that level of flexibility will help businesses do two things… more effectively use the PPP dollars they were able to secure and give them a chance to not have to pay back that low-interest loan.”
Businesses were granted the money in early April to survive the pandemic, but then many, like restaurants and salons, were forced to close and they let some workers go.
Guidance recently released by the small business association has helped clear a few hurdles..
“Now the guidance from the SBA is if you can show and document that you offered re-employment to those individuals you laid off or furloughed and they refused to come back, we won’t cap against you.”
But in many cases, it’s still not enough. More time and flexibility are badly needed as the window to start paying it back gets closer. Lewis says an amendment to the PPP is not likely before Friday but he is expecting something at the end of the week.