AGC Enters into Negotiations with SBA; Hoping for Settlement of PPP Lawsuit
AGC Member Wins Forgiveness of PPP Loan Over $2 Million
AGC and the U.S. Small Business Administration (SBA) have agreed to formal discussions of a potential settlement of the lawsuit that AGC has brought against the Loan Necessity Questionnaire still burdening all applicants for forgiveness Paycheck Protection Program (PPP) loans of over $2 million. AGC has not, however, relinquished any of its rights to litigate the matter if negotiations do not bear fruit. In the meantime, AGC recently learned that a construction contractor among the association’s members has won forgiveness of a PPP a loan over $2 million. AGC is pleased by the news and hopes that it means SBA is preparing to quickly approve many of the applications for the forgiveness of such loans, after months of prolonged delay. If you have applied for forgiveness of a PPP loan of over $2 million, please take a moment to let AGC know of any action that SBA has taken on your application by emailing Mike.Kennedy@agc.org, as that information could help all construction firms.
Regarding the litigation, AGC’s objective is to ensure that SBA fairly evaluates applications for the forgiveness of PPP loans, based on the certifications that borrowers actually made—at the time they applied for their loans. Instead of serving that purpose, the questionnaire seems intended to create new requirements for forgiveness. Instead of asking borrowers about the economic uncertainty they were facing as they applied for their loans, the questionnaire asks borrowers to demonstrate that the pandemic played out the way they expected, to report any decisions they “voluntarily” made to cease, reduce or alter their operations, to report their cash balances, and to report whether they paid any employees more than a sum plucked from thin air. AGC explained all of this to the agency on March 5, when the association submitted its second set of extensive comments on the questionnaire, found here.