As of May 4, 2021, the Small Business Administration (SBA) announced that the most recent round of Paycheck Protection Program (PPP) funding is essentially exhausted, meaning that most lenders cannot enter new loan applications into the PPP portal.
There is also about $8 billion in PPP funding that was Congressionally mandated for use by community financial institutions, defined as Community Development Financial Institutions (CDFIs) and Minority-owned Depository Institutions (MDIs). These designated lenders may continue submitting PPP applications.
The SBA also clarified the status of loans that were in progress. If a bank submitted a loan application in the PPP portal, but the SBA did not issue a loan number, that loan will not be approved. The SBA suggested that banks in this situation consider referring these applicants to a CDFI or an MDI.
Banks did a fantastic job of getting PPP money to qualifying small businesses. According to the ABA, banks originated 74% of the 10.8 billion PPP loans, and bank loans accounted for 91% of the $780 billion in total PPP lending. The PPP provided an important lifeline to small businesses throughout Minnesota, and the program would not have been successful without the efforts of the Minnesota banks!
Citizens Bank Minnesota will process all unfunded SBA applications if the government allocates more funds to future Paycheck Protection Programs.
Let us know if you have any questions - we are here for you!
Citizens Bank Minnesota Lending Team
Questions? Please give us a call at 800-549-0194.
Restaurant Revitalization Fund (RRF)
The American Rescue Plan Act established the Restaurant Revitalization Fund (RRF) to provide funding to help restaurants and other eligible businesses keep their doors open. This program will provide restaurants with funding equal to their pandemic-related revenue loss up to $10 million per business and no more than $5 million per physical location. Recipients are not required to repay the funding as long as funds are used for eligible uses no later than March 11, 2023. Thus making this a grant program.
Eligible entities who have experienced pandemic-related revenue loss include:
- Food stands, food trucks, food carts
- Bars, saloons, lounges, taverns
- Snack and nonalcoholic beverage bars
- Bakeries (onsite sales to the public comprise at least 33% of gross receipts)
- Brewpubs, tasting rooms, taprooms (onsite sales to the public comprise at least 33% of gross receipts)
- Breweries and/or microbreweries (onsite sales to the public comprise at least 33% of gross receipts)
- Wineries and distilleries (onsite sales to the public comprise at least 33% of gross receipts)
- Inns (onsite sales of food and beverage to the public comprise at least 33% of gross receipts)
- Licensed facilities or premises of a beverage alcohol producer where the public may taste, sample, or purchase products
**You will apply directly: https://restaurants.sba.gov
Complete SBA Form 3172 (Online application). A current paper sample is available to view on the SBA website.
- Verification for Tax Information: IRS Form 4506-T, completed and signed by Applicant. Completion of this form digitally on the SBA platform will satisfy this requirement.
- Gross Receipts Documentation: Any of the following documents demonstrating gross receipts and, if applicable, eligible expenses
- Business tax returns (IRS Form 1120 or IRS 1120-S)
- IRS Forms 1040 Schedule C; IRS Forms 1040 Schedule F
- For a partnership: partnership’s IRS Form 1065 (including K-1s)
- Bank statements
- Externally or internally prepared financial statements such as Income Statements or Profit and Loss Statements
- Point of sale report(s), including IRS Form 1099-K
Determination of Funding:
Calculation 1: for applicants in operation prior to or on January 1, 2019:
- 2019 gross receipts minus 2020 gross receipts minus PPP loan amounts
Ex. Your restaurant’s gross receipts $1,200,000 in 2019 - $650,000 in 2020 - $190,000 PPP received first and second draws = $360,000 in RRF grant funds !
Calculation 2: for applicants that began operations partially through 2019:
- (Average 2019 monthly gross receipts x 12) minus 2020 gross receipts minus PPP loan amounts
- Business payroll costs (including sick leave)
- Payments on any business mortgage obligation
- Business rent payments (note: this does not include prepayment of rent)
- Business debt service (both principal and interest; note: this does not include any prepayment of principal or interest)
- Business utility payments
- Business maintenance expenses
- Construction of outdoor seating
- Business supplies (including protective equipment and cleaning materials)
- Business food and beverage expenses (including raw materials)
- Covered supplier costs
- Business operating expenses
Applications open on Monday, May 3rd at 11:00 AM.
Priority for the first 21 days of program for small business owners that are 51% or greater owned: women , veterans, or minorities.
Program open to all starting on day 22 until the fund is exhausted.
The SBA Hotline for this program is 1-844-279-8898.