SBA runs out of money! Stops taking loan applications.

[ATSMAN]

https://www.journalofaccountancy.com/news/2020/apr/sba-stops-ppp-loan-applications-coronavirus-funding-runs-out.html?utm_source=mnl:alerts&utm_medium=email&utm_campaign=16Apr2020&utm_content=button

The U.S. Small Business Administration stopped accepting applications for the Paycheck Protection Program after exhausting the initial $349 billion in funding provided by Congress to fund forgivable loans to small businesses impacted by the COVID-19 pandemic.

The SBA, which is administrating the program with Treasury, posted a statement on its website saying that it is currently unable to accept new PPP applications based on available appropriations funding. The SBA also said it is unable to enroll new PPP lenders at this time.

[Lion]

And, Congress is arguing about issuing another 250B.

[kathyc2]

This program is a total boondoggle. No requirement of having to show business was effected by COVID. Some back of envelope calculations: 2017 IRS stats show wages for returns with AGI less than 200K is 5.5 Trillion dollars. SBA says 43% of wages is from employers with less than 500 employees. So, there is a potential of 2.7 trillion of "loan" applications.

[ATSMAN]

They urgently need to get the funding reinstated otherwise you can kiss goodbye to a large portion of small business and taxpayers will be on unemployment line for a very long time. Some of my business clients who are waiting for funding to resume can't hold on much longer!

[kathyc2]

Correction on my calculation. The 2.7T would be for a full year payroll, but since it's 2.5 months, more like 560 billion.

Atsman: if they would have structured it better, I would have less of an issue with it. As it is, I have business clients that have had very minimal consequences of COVID getting 200-400K "loans".

Since April 1, the federal public debt has increased 800 billion.

[ATSMAN]

Correction on my calculation. The 2.7T would be for a full year payroll, but since it's 2.5 months, more like 560 billion.

Atsman: if they would have structured it better, I would have less of an issue with it. As it is, I have business clients that have had very minimal consequences of COVID getting 200-400K "loans".

Since April 1, the federal public debt has increased 800 billion.

Agree with that part but you also have to understand this was a very quick decision without a lot of thinking because of the urgency. There was tremendous political pressure to get the money out the door to save businesses. If they had taken their time to think this trough the delay would have got such negative media coverage that no administration was going to risk that. My mother used to say haste makes waste! I tell that to my children all the time.

[Uncle Sam]

When the government gives you something - they don't tell you the whole story and when the facts change they don't disclose it.
The EIDL loan program - when it was first announced - oh boy - it sounded like every qualified business was entitled to a flat $ 10,000 loan - so you had to go online to apply. THEN - the law was changed and clarified so it's $ 1,000 PER EMPLOYEE - big difference. WHAT WAS NOT TOLD - was that when that rule was changed, the APPLICATION CHANGED, but never announced if you had applied and got a confirmation online with the first digit being 2, your application was then declared invalid and wasn't being considered and started a new series that started with the first digit being a 3 - THOSE ARE being considered and acted upon - just have to wait your turn in line to have it considered and determined.

[ATSMAN]

I think we can all agree there was too much confusion in the beginning and people were just scrambling to submit an application to get in line!