The restaurant industry scored a major legislative victory Wednesday when the U.S. Senate voted to triple the amount of time small businesses are allotted under the Paycheck Protection Program (PPP) to spend their relief loans and still have them forgiven.
In addition to extending the spending timeframe to 24 weeks, the bill allows restaurants and other borrowers to use up to 40% of the loaned money on rent and other operating costs unrelated to payroll. The law currently requires that 75% of the money be spent on wages and salaries if the borrower wants to have the loan forgiven.
The bill has already been approved by the House of Representatives. President Trump is expected to sign the measure into law today.
By Peter Romeo on Jun. 04, 2020
Source: Illinoisrestaurants.org
My thoughts
This is great news for the restaurant industry, especially those currently closed or running at 25% capacity. Now you can spread the loan over 24 months and use 40% for expenses other then payroll. The PPP money really never designed for the restaurant industry when you only had 8 weeks to spend it and had to use 75% on payroll… when you were not even open. Glade congress realized this and amended the bill
Tom Traina
Principal
EatZ & Associates