The House and Senate have passed a $900 billion relief bill that will provide direct relief to newspapers and other local news media. The bill has been signed by President Trump.
Sen. Maria Cantwell (D-WA) was instrumental in securing the fix that increased newspapers' eligibility under the new package. Special thanks also goes to David Chavern, Danielle Coffey and the team at the News Media Alliance for their work in getting the components that were of critical importance to newspapers included in the bill.
“During this pandemic, local newspapers and broadcasters must continue to communicate vital COVID health data, including lifesaving information about public health guidance, the vaccines and vaccine distribution,” said Senator Cantwell.
“Local news is essential," she said. "It makes our communities — and our country — stronger by asking important questions, providing accurate facts, and countering misinformation and disinformation. This bill will make more newspapers, TV and radio stations, and public broadcasters eligible for the Paycheck Protection Program so local reporters can keep us informed.”
America's Newspapers President Alan Fisco, president of The Seattle Times Co., expressed his appreciation to legislators for their support, saying: "The expansion of small business loans to many newspapers that did not qualify initially will be a huge benefit to our industry while protecting ever-shrinking newsroom ranks. Special thanks go out to our legislative champions including, Senators Maria Cantwell, John Boozeman, Amy Klobuchar, Joni Ernst and Chuck Schumer. They along with Representatives David Cicilline and Jim Sensenbrenner introduced the initial bill, the Local News and Emergency Information Act, that led to this critical fix being included in the new stimulus bill. The bill also allows for a second loan for those who already qualified under certain conditions."
Steve Shelton, managing shareholder, Way, Ray, Shelton & Co., P.C. provided a summary of the bill’s impact on newspapers.
Tax Treatment of Paycheck Protection Program (PPP) Loans:
PPP Second Draw Loans:
PPP Loan Forgiveness:
Repeal of EIDL Advance Deduction:
Once the bill is enacted, the bill gives the SBA 10 days to issue regulations to carry out this Act.
Therefore, at this point, there are no regulations on the new PPP loans, and a loan application has not been created. For those who are interested in obtaining a PPP Second Draw loan, Shelton recommends that you review your quarterly revenue totals for all quarters of 2019 and 2020 to see if any quarter has a decrease of over 25%, as this is the main eligibility test for a PPP Second Draw Loan.