The Small Business Administration (“SBA”) closed the window for applications for its popular Paycheck Protection Program (“PPP”) on Monday, May 31, 2021, after approving nearly $800 billion in loans since the commencement of the program in April, 2020. Just over $10 billion(1) in loans have gone to Georgia businesses, and about 10% of the total PPP loan funds have gone to businesses in the “health care and social assistance” industry.  The SBA has not yet released a summary of data on loan forgiveness amounts for 2021, however it reports that about 54% of PPP funds that were issued under loans approved in 2020 have been forgiven, while forgiveness applications for roughly 15.6% of 2020 PPP loan funds remain under review.  The SBA has not received forgiveness applications for a little over 30% of 2020 PPP loan funds. 

What’s Next?

Businesses that have accepted PPP loan funds can apply for forgiveness as soon as the business as spent all PPP loan funds for which it plans to request forgiveness and must apply for forgiveness before the maturity date of the loan (either two years or five years after the date issued, depending on when the loan was issued). Businesses can get the correct forgiveness application from their PPP loan lender and should be prepared to submit documentation showing (i) payroll expenses during the covered period, and (ii) non-payroll expenses paid during the covered period (to prove that obligations existed prior to February 15, 2020). 

An Enforcement Wave is Coming – Keep Documentation Handy

Businesses that plan to submit or have already submitted forgiveness applications should keep all documentation on hand to show that the PPP loan funds were properly used for eligible expenses. As Chilivis Grubman previously reported, Attorney General Merrick B. Garland recently announced a new COVID-19 Task Force, which will collaborate with several different agencies, including the SBA. The COVID-19 Task Force is expected to focus on PPP loans, among other COVID-19 relief programs.  To date, many of the Department of Justice’s enforcement actions have involved particularly blatant cases of fraud (for example, see the DOJ’s February statement regarding an individual that pleaded guilty to fraudulently obtaining $3.9 million in PPP loans and using part of the funds to purchase a Lamborghini). However, with the new task force, businesses can expect to see increased coordination between agencies and enforcement actions in more nuanced scenarios. 

The attorneys at Chilivis Grubman represent clients of all types and sizes, including healthcare providers and small businesses that have accepted COVID-19 relief funds.  If you need assistance with enforcement activities related to COVID-19 relief funds, please contact us today.

  1. According to the SBA’s PPP Loan data, found here:; data is current through 05/23/2021