Show an ad over header. AMP

Small business Paycheck Protection Program to restart next week

08 January 2021
Dan Ackermann

The next round of Paycheck Protection Program loans will open on Monday, albeit not for everyone.

Why it matters: As evidenced by this morning's bleak jobs report, many businesses continue to be battered by the surging pandemic.

Timing: The loan application window will open Monday primarily for first-draw borrowers working with a group of smaller lenders defined as community financial institutions. On Wednesday it will be expanded to second-draw applications from those same lenders, which comprise around 10% of PPP's approved lender universe.

  • No official word yet on when it opens up to the broader universe, save for a senior administration official saying it will be "shortly thereafter."
  • A different official added that, unlike last spring, "We don't anticipate the money to run out."

One big change: SBA won't instantaneously provide loan numbers to applicants. Instead, it will use an automated system to vet some of the provided information (ID verification checks, etc.), which will run on top of the E-Tran platform that was used last year.

  • The software change means many lenders will need to enter information manually, including for second-draw loans.
  • The verification process means there is likely to be an overnight lag between application and approval.

Other changes, as previously reported, includes new payroll limits (300 vs 500) and a requirement that applicants can demonstrate at least a 25% reduction in gross receipts between comparable quarters between 2019 and 2020.

One big question is how many lending institutions will participate this time around.

  • Over 5,400 participated by the end of the initial PPP, but many bankers grumbled about it being more trouble than it was worth — and the manual inputs this time could exacerbate those sentiments.
  • There's even become a secondary market for PPP loan portfolios. Chicago-based ACAP, for example, has bought up around 34,000 loans from nearly 40 banks valued at around $4.7 billion. CEO Luke LaHaie tells Axios that he expects to help originate second-draw loans for many of those clients, as their initial lenders don't plan to directly participate in 2021.

The big picture: Almost every issue of the Axios Pro Rata newsletter now includes a VC, private equity and/or M&A blurb for a company that received PPP.

The bottom line: Better late, and a little bit slower, than never.

Transcripts show George Floyd told police "I can't breathe" over 20 times

Section2

Newly released transcripts of bodycam footage from the Minneapolis Police Department show that George Floyd told officers he could not breathe more than 20 times in the moments leading up to his death.

Why it matters: Floyd's killing sparked a national wave of Black Lives Matter protests and an ongoing reckoning over systemic racism in the United States. The transcripts "offer one the most thorough and dramatic accounts" before Floyd's death, The New York Times writes.

The state of play: The transcripts were released as former officer Thomas Lane seeks to have the charges that he aided in Floyd's death thrown out in court, per the Times. He is one of four officers who have been charged.

  • The filings also include a 60-page transcript of an interview with Lane. He said he "felt maybe that something was going on" when asked if he believed that Floyd was having a medical emergency at the time.

What the transcripts say:

  • Floyd told the officers he was claustrophobic as they tried to get him into the squad car.
  • The transcripts also show Floyd saying, "Momma, I love you. Tell my kids I love them. I'm dead."
  • Former officer Derek Chauvin, who had his knee on Floyd's neck for over eight minutes, told Floyd, "Then stop talking, stop yelling, it takes a heck of a lot of oxygen to talk."

Read the transcripts via DocumentCloud.