Academy Bank has been honored to participate in the Paycheck Protection Program, through which we have successfully helped more than 1,300 clients receive loans crucial to assisting small businesses. As applications are currently closed, we will now turn our attention to the Loan Forgiveness portion of the program. We will provide as much information possible to our clients to help them in full forgiveness on their loans.
 

Update - July 29, 2020

On July 24, 2020, the SBA issued a new procedural notice containing the procedures for PPP lenders to submit processed forgiveness decisions to the SBA through a third-party website. Per the SBA notice, the target date for the SBA to start accepting forgiveness decisions is August 10, 2020. However, the aforementioned date may be delayed if any additional legislation is passed that impacts the PPP forgiveness process. At Academy Bank, we have been working and will continue to work to convert the SBA 3508 Forgiveness Application, the 3508 EZ Application, and the newly issued forgiveness procedures into an easy to use online platform.  We will only accept applications originated through our online platform. Our goal is to open the Academy Bank online forgiveness process for our clients approximately the same time the SBA starts accepting forgiveness applications (mid-August). To start the forgiveness process, all of Academy Bank’s PPP borrowers will receive an email with a personalized link to the online forgiveness platform.
 

The Paycheck Protection Small Business Forgiveness Act is a new law being considered by Congress. If passed, PPP loans of $150,000 and less can be fully forgiven by completing and submitting a one-page certification to the lender. The form will certify that the borrower complied with requirements under section 7(a)(36) of the Small Business Act. If the Act becomes law, the SBA will have up to 7 days to develop and issue this new certification. If passed, Academy Bank will incorporate this new certification into its online forgiveness platform and the email you will receive inviting you to apply for forgiveness. If you do not qualify for the automatic forgiveness, you will be able to access the full forgiveness application.
 

We recommend you start preparing now for the upcoming forgiveness process. For up-to-date rules, the SBA Form 3508 Forgiveness Application, and the SBA Form 3508 EZ, please visit the SBA website. The instructions for the forgiveness applications include guidance as to which borrowers qualify for the EZ form and what documentation you are required to collect and submit. If you do not qualify for the 3508 EZ, we recommend you complete the 3508 Schedule A worksheet prior to completing the online application process. Several third parties have developed online tools to help with the overall forgiveness application process, such as PPP.Bank.
 

If you have any questions, please contact us at pppforgiveness@academybank.com.
 

July 8, 2020

We continue to incorporate the latest SBA guidance and expect additional guidance to be forthcoming. We expect to start accepting online PPP Forgiveness applications in August. 

On June 16, the SBA released an updated PPP Forgiveness application and a new EZ application.  These applications can be reached by following the US Treasury or SBA links below.

Per current guidance, there is no requirement for PPP borrowers to immediately submit a forgiveness application at the end of their 8 or 24 week covered period.

Payments are generally deferred until 10 months after your 8-week or 24-week Covered Period ends.

  • If you apply for Forgiveness in the deferral period, you won’t have to start making payments on unforgiven amounts until the SBA provides a decision on your request or remits funds.
  • If you do not apply for Forgiveness within the deferral period, you must begin making payments after your deferral period.
  • Accrued interest on the approved forgiven amount of the PPP loan is paid by the SBA through the date payment is issued.

Please continue to check our website for updates. 

June 9, 2020

The Paycheck Protection Flexibility Act was signed into law on June 5. On June 10, the SBA published an Interim Final Rule to implement significant changes contained within this act that are beneficial for a majority of PPP borrowers. The PPP forgiveness application that was issued by the SBA on May 15, the May 22 Interim Final Rules related to Loan Forgiveness and Lender Responsibilities, and previously issued FAQs will all need to be updated to reflect these changes. The SBA has not yet released instructions or final guidance to lenders on how loan forgiveness will work going forward, but we will continue to keep our website updated as we receive information. Please continue to monitor the U.S. Treasury, SBA and Academy Bank websites for additional information related to the forgiveness process. 

Please do not submit a Loan Forgiveness Application at this time. We will have a formal and electronic process in place at a later date.  You will receive an email from us with a link to your Loan Forgiveness Application when the SBA allows us to begin accepting applications for forgiveness. As we wait for further guidance, you should gather the documentation verifying eligible expenses, including the number of full-time equivalent employees on your payroll and their pay rates for the time frame used to verify you met the staffing and pay requirements.  A helpful guide developed by AICPA can be found here.1

Please continue to check Academy Bank’s website for updated information that we will include on the site as it becomes available. For specific questions about loan forgiveness, contact pppforgiveness@academybank.com.

You may also download the U.S. Chamber of Commerce's checklist and guide1 to learn more about requirements and eligibility. And, here you'll find a list of frequently asked questions.

1As of June 9, the guides from AICPA and U.S. Chamber of Commerce had not been updated to reflect the Paycheck Protection Flexibility Act.

Loan Forgiveness

The borrower may apply to the lender for loan forgiveness subject to specific conditions:

  1. The employer maintaining or quickly rehiring employees and maintaining salary levels.
  2. Sixty percent (60%) of the forgiven amount must have been used for payroll costs. Current PPP borrowers can choose to extend the eight-week period to 24 weeks, or they can keep the original eight-week period. New PPP borrowers will have a 24-week covered period, but the covered period can’t extend beyond Dec. 31, 2020.
  3. Paycheck Protection Program loan proceeds must have been used for these types of costs, and payments made, between February 15, 2020 and December 31, 2020.
  4. Payroll costs, excluding the prorated portion of any compensation above $100,000 per year for any person.
  5. Group healthcare benefit costs and insurance premiums.
  6. Mortgage interest (but not prepayments or principal payments) and rent payments on leases in existence before February 15, 2020.
  7. Certain utilities, including electricity, gas, water, transportation, and telephone and Internet access for service that began before February 15, 2020.
  8. Additional wages paid to tipped employees.

The loan amount forgiven is reduced if the average number of full-time employees is reduced or any employee compensation is reduced by more than 25% as a result of COVID-19. Borrowers can use the 24-week period to restore their workforce levels and wages to the pre-pandemic levels required for full forgiveness. This must be done by Dec. 31, a change from the previous deadline of June 30. The Paycheck Protection Flexibility Act includes two new exceptions allowing borrowers to achieve full PPP loan forgiveness even if they don’t fully restore their workforce. Previous guidance already allowed borrowers to exclude from those calculations employees who turned down good faith offers to be rehired at the same hours and wages as before the pandemic. The new bill allows borrowers to adjust because they could not find qualified employees or were unable to restore business operations to Feb. 15, 2020, levels due to COVID-19 related operating restrictions.

Once the SBA allows us to begin accepting Loan Forgiveness Applications, we will process them and submit a recommendation within 60 days of receipt of the application. We will notify you of our recommendation to the SBA. The SBA then has 90 days to process your application and determine your forgiveness eligibility. The SBA has the right to review any loan at any time. We will notify you within 5 days if the SBA reviews your loan and requests additional information. Otherwise, we will notify you when we receive the SBA’s final determination of forgiveness.

Disclosures:
 
It is your sole legal responsibility to comply with all laws and regulations applicable to borrowers under the PPP.  Academy Bank recommends that you closely review the latest laws, regulations and guidelines issued by the SBA with respect to the PPP (“Guidelines”). The Guidelines can be located on the SBA and Department of the Treasury websites: www.sba.gov and www.treasury.gov. Academy Bank cautions that the Guidelines are evolving and subject to change, clarification and/or periodic updates by the SBA.
Academy Bank is not providing legal, tax or accounting advice with this application or any other correspondence related to PPP or otherwise. Individual facts and circumstances may vary from borrower to borrower which could impact answers regarding interpretations of Guidelines or other questions. You should consult with your legal, tax and accounting advisors to obtain advice regarding your specific situation. Our materials and communications should be considered in conjunction with, and not as a replacement or substitute for, your close review of the Guidelines.