Farm Bureau: Farmers should try to use SBA Paycheck Protection Program loans
The American Farm Bureau Federation said late Friday that farmers should be eligible for the Paycheck Protection Program loans that Congress set up in the third coronavirus aid bill.
Early Thursday, Farm Bureau’s Market Intel service published an article noting that the Small Business Administration has industry-specific revenue thresholds that might exclude thousands of agricultural producers from getting Paycheck Protection Program loans.
But Veronica Nigh, the Farm Bureau economist who wrote the earlier article, noted that late Thursday SBA released the Paycheck Protection Program interim final rule (IFR).
“Based on our analysis of the IFR, we are pleased to confirm that the IFR removes the industry-specific revenue thresholds. Agriculture enterprises that employ 500 or less people whose principal place of residence is in the United States are eligible, regardless of revenue levels.”
Nigh noted that “the portion of the loan that covers eligible expenses within an eight-week period from Feb. 15, 2020 — June 30, 2020, is forgivable, as long as the company maintains staff and payroll. Any loan proceeds in excess of this amount are subject to repayment at a rate of 1%. The maximum duration of the PPP loans is two years.”
But she also noted that “the IFR does seem to confirm that wages paid to H-2A workers do not count toward a farm’s payroll cost. The IFR also confirmed that independent contractors neither count toward payroll costs, nor toward the number of the business’s employees. The logic here is that independent contractors are eligible to apply for their own PPP loan.”