Last Wednesday the US Senate approved the Paycheck Protection Flexibility Act extension. The act passed through Congress with flying colors and is now awaiting approval from the President.
This extension will:
-Extend the expense forgiveness period from eight weeks to 24 weeks, but that 24-week period cannot extend beyond Dec. 31, 2020.
-Reduce the payroll ratio requirement from 75% to 60%, allowing businesses to use up to 40% of funding for non-payroll expenses like rent or utilities.
-Increasing the loan repayment period from two to five years on new loans. For those who do not achieve forgiveness, the interest rate remains at 1%.
-Allowing payroll tax deferment for PPP recipients.
-Extending the deadline for rehiring workers from June 30 to Dec. 31. The bill also allows exemptions from forgiveness requirements if employers can document in good faith their inability to rehire certain workers who were employed as of Feb. 15, or similarly qualified workers before Dec. 31.
While our country appears divided on multiple fronts, the restaurant industry is remaining united and supported by all parties.
The Independent Restaurant Coalition is still developing and fighting for long-term solutions for the restaurant industry. The Flexibility Act does provide some extra assistance and leeway, but more needs to be done.
In other news, the industry as a whole has recovered 50% since nationwide revenues bottomed out at -66.3% in late March.
Times (and sales) are looking up. Hang in there and keep fighting.
We are here for you.