On Thursday, April 2, 2020, the Small Business Administration (SBA) released its interim final rules on the implementation of sections 1102 and 1106 of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. These sections address the Paycheck Protection Program (PPP), which was created when the CARES Act was signed into law on March 27. The PPP is a loan program that makes approximately $350 billion available to small businesses using the SBA’s existing 7(a) loan program.
The PPP has generated tremendous interest from companies including those in the hospitality industry. However, these new interim rules may prove more stringent—and in some cases, different—than what was set out originally in the CARES Act. Hotel and lodging companies should carefully review the provisions including eligibility, loan proceeds, and documentation requirements. Here is a summary of key points in the interim final rules that may be of interest to hospitality companies considering a PPP loan.