DEADLINE JUNE 30th: Paycheck Protection Program Fix for Commercial Fishing Businesses
Updated: 3 days ago
NOTE: The U.S. Senate unanimously passed legislation to extend the Paycheck Protection Program to August 8, 2020. The small business loan program expired yesterday, on June 30. It now needs to pass the House in order for it to be sent to the President’s desk to be signed into law.
WASHINGTON, D.C. – U.S. Senators Lisa Murkowski and Dan Sullivan, and Congressman Don Young (all R-Alaska) today applauded a rule released by the Department of Treasury and Small Business Administration that will allow commercial fishing businesses to account for crew member payroll when applying for Paycheck Protection Program (PPP) loans. Over the past several weeks, the Alaska Congressional Delegation has pressed the Trump administration for the change – which included sending a letter to Treasury Secretary Mnuchin and Administrator Carranza, to request the solution published today.
“The Paycheck Protection Program has provided direct relief, truly a lifeline, to Alaskan businesses to help weather the storm during the COVID-19 pandemic. Unfortunately, many of our fisherman, the ultimate small businesses, were unintentionally left out of the mix due to the Treasury Department’s earlier interpretation of ‘eligible payroll costs,’” said Senator Murkowski. “I thank the Treasury Department for working with the delegation to ensure that fishermen have the same opportunity to fully take advantage of the Paycheck Protection Program that so many American businesses have already benefited from. Enabling fishermen to secure the resources they need through PPP is not only fair, it means that these businesses so critical to Alaska have a fighting chance to stay afloat.”
“Alaska is the super-power of seafood because of our hard working fishermen, who, along with so many other Alaskans, have been hurt as a result of the pandemic,” said Senator Sullivan. “This common-sense fix to the Paycheck Protection Program, has been too long in coming, but I’m grateful that the Treasury Department finally made it happen. I’m also grateful for the many fishermen in our state who have reached out to my office proposing solutions. Going forward, we will continue to work with the fishing industry to ensure that they can take full advantage of federal funds offered as a result of COVID-19 and on-going stabilization efforts.”
"Alaska's seafood sector is a central pillar of our state's economy, and this crucial industry has taken a tremendous hit from the COVID-19 pandemic. The CARES Act was critical for mitigating the economic impact of the pandemic,” said Congressman Young. “The Paycheck Protection Program created by this legislation continues to serve as a lifeline for many businesses. Unfortunately, federal bureaucracy has prevented our fishermen and processors from taking advantage of this resource. The fix announced today by Secretary Mnuchin and the Trump Administration is welcome news for the countless Alaskans who depend on our waters for their livelihoods. I am more optimistic than ever that our seafood industry will come out of this pandemic stronger than ever before. Our Delegation has been working very hard on behalf of our fishermen on this crucial matter, and I want to thank President Trump for his partnership on behalf of the families in our state."
NOTE: Fishermen have until June 30, 2020 to apply for PPP funds.
While commercial fishing businesses have been eligible for PPP loans, before today’s fix they were not fully able to take advantage of the PPP due to the Department of Treasury’s previous treatment of their employees. Fishing crew members are generally considered self-employed independent contractors by the Internal Revenue Service. Even though these crew members are functionally employees, the previous rules did not allow commercial fishing businesses to account for their employee’s wages when calculating payroll costs when applying for a PPP loan. This led to reduced loan amounts. Today’s rule allows these businesses to account for their crew member’s wages when applying for a PPP loan.