SBA issues initial guidance
The SBA released some initial guidance, the most significant is the clarification that seasonal NAICS 72- businesses can use the “any 12 week” base period for 3.5x loan amount calculation. This means camps that qualify will see a huge increase in their loans.
A couple other important details:
If you are using the same base period as you used for PPP #1, you don’t need to submit your payroll documentation again. (And if you are using the same lender as PPP#1).
You can show either a 25% drop in gross receipts from any quarter in 2020 to the corresponding quarter in 2019; or simply annual 2020 receipts compared to 2019, for which you can simply submit your tax returns. If tax returns are not available, the borrower may submit financial statements.
For loans less than $150,000, you do not need to submit documentation of a 25% reduction with your application, but will be required to show it when you apply for forgiveness.
For increases to PPP#1 loans:
SBA announced details on who can apply for an increase, including seasonal businesses who would have been eligible for a higher loan amount.
SBA said they still need to come up with an application process for increases, stay tuned…
SBA did not address if businesses can change their designation from non-seasonal to seasonal.
Critically, all PPP#1 funds must be used before a PPP#2 loan can be approved. So only apply for the amount of funds you can get forgiven, even if the increase would make you eligible for significantly more.