CBIZ, a full-service accounting firm and leader in apparel industry consulting & advisory, has been working diligently to provide accurate and up-to-the-minute information regarding government loan and grant opportunities. CBIZ has provided a brief overview of the most valuable opportunities:

All updates below as of 6.5.2020 

Economic Injury Disaster Loan (EIDL)

We have begun to see EIDL funds be distributed to companies who applied in March. At this point there does not seem to be any rhyme or reason as to who receives money, and how much they get. We suggest that you double check for any emails from the SBA, as well as the bank account you provided on your application. Do not panic if you have not received the EIDL- you might still see the money deposited into your account in the coming week(s).

The loan mentioned above is the actual EIDL, separate from the previous “EIDL Advance” of up to $10,000 that you might have already received.

CARES Act- Paycheck Protection Program (PPP)

Last week, Congress passed another bill with further updates to PPP loans and forgiveness. There are a few major changes that should be beneficial to everyone who received funding. You can read the bill here. See below for some important details:

• Only 60% of your loan amount has to be used for payroll costs (previously 75%), however in order to qualify for any forgiveness, you must meet or exceed 60%. If you do not use 60% of your loan amount for payroll costs you will receive zero forgiveness.
• The eligible forgiveness period has been extended from 8 weeks to 24 weeks, to allow companies to further stretch their loan money for as long as possible. At this time there is no discussion about a second round of funding.
  • Note: CBIZ is in the process of updating our Forgiveness Calculator to reflect all updates. We plan to have it available to you in the coming days.
• You have the option to start your PPP “timer” either on the date you were funded (original rule), or on the date of your first payroll after funding. This is called the Alternative Payroll Covered Period, and should allow you to further extend your forgiveness period by at least a few days.
• The loan repayment period has also been extended from 2 years to 5 years, at the same 1% rate.

In addition, the SBA previously announced that all loans under $2 Million would not be reviewed and assumed in good faith, but they have backtracked and slightly altered their language. The SBA may now audit any loan at their discretion. As long as you continue to use the PPP for its intended purpose (payroll costs) and keep diligent records, you should not have to worry about this update.

The SBA plans to alter their previously circulated ‘Loan Forgiveness Application’ as they continue to work through FAQs and various contradictions that still exist. Expect further clarity in the near future, and you can officially stop working on the outdated application.

* Please note that all information above is subject to change, and CBIZ New York is not liable for any loan applications that are submitted.*

The CBIZ Apparel Group is here to support the CFDA and its Members. If you have any questions or concerns about the EIDL, PPP, or specific re-opening plans, please reach out to Eric Seaman at eseaman@cbiz.com.