April 3, 2020

As part of the CARES Act signed into law last week, the Small Business Administration (SBA) established the $350 billion Payroll Protection Program (PPP) to provide loans to small businesses with less than 500 employees impacted by the COVID-19 crisis. The intent of the PPP is to provide a direct incentive for small businesses to keep workers on their payroll for at least eight weeks. The 1% interest loans have a maturity of 2 years. Payments will be deferred for six months although interest will accrue during the deferral period. Amounts used for payroll, rent, mortgage interest, or utilities for the eight weeks following the loan origination will be forgiven subject to certain limitations.

Who is Eligible?

Eligible organizations, including nonprofit organizations or 501(c)(19) veterans’ organizations with less than 500 employees, small businesses and sole proprietorships. Loans are on a first come first served basis.


The goal was for banks to start processing PPP loan applications beginning today. However, guidance to lenders and potential lenders was issued yesterday and there are still many unanswered questions. GRF is aware of two lenders (Bank of America and Chase) that opened online portals for application submission, along with other local banks that began accepting applications by email. The processing times are still unclear as the banks await final guidance from the SBA.

Before You Apply

All of these factors have led to a lot of angst for those applying for or considering PPP loans.

  • Contact your bank to inquire if it is, or will participate as a lender. If not, find a participating bank
  • Let the lender know you want to be “in the queue” for the PPP loan process
  • Review the lender’s application and related information
  • Compile information required, especially average monthly payroll to determine your potential loan amount
  • Consider whether the organization’s by-laws require a board resolution for this borrowing


For questions or more information regarding the PPP, visit our COVID-19 Resources page or contact GRF’s tax team.

Richard J. Locastro, CPA, JD

Walter H. Deyhle, CPA/ABV/CFF, MAFF, CexP, CEPA