SBA Terms for New Round of Paycheck Protection Program Funding

The Small Business Administration released Interim Final Rules outlining the terms for the new round of funding for the Paycheck Protection Program (PPP).  The application window for PPP loans is expected to open the week of January 11th and remain open until March 31, 2021, or when funding is exhausted.  This round of funding will include new borrowers (First Draw PPP) that did not receive a PPP loan in 2020 and provide an opportunity for existing borrowers to reapply (Second Draw PPP).  

Eligibility Requirements

First Draw PPP eligibility requirements are similar to those used to determine eligibility for prior rounds of PPP funding.  Please note that some industries that were ineligible to receive earlier round PPP loans are now eligible.  If you applied for and received a PPP loan in 2020, you are not able to apply for the First Draw PPP loan but may be able to apply for a Second Draw PPP. 

A borrower is generally eligible for a Second Draw PPP loan if the borrower meets the following criteria:

  • Previously received a First Draw PPP and has used or will use the full amount of the loan prior to receipt of funding from a Second Draw PPP; and
  • Has no more than 300 employees; and
  • Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.

SBA may provide additional guidance on eligibility in the coming weeks.  Below are the most current links to the SBA documents explaining terms of the new round of funding:

Top-Line Overview of First Draw PPP Loans – CLICK HERE

  • Full Interim Final Rule for First Draw PPP Loans – CLICK HERE

Top-Line Overview of Second Draw PPP Loans – CLICK HERE

  • Full Interim Final Rule for Second Draw PPP Loans – CLICK HERE

Calculating Your Loan

Instructions for calculating your loan amount are provided in the terms linked above as well as the PPP applications.  Generally speaking, the calculations are similar for First Draw and Second Draw PPP.

  • 2.5 times your average monthly payroll
  • Maximum loan amount of $2,000,000
  • Average monthly payroll is calculated by using 2019 or 2020 total payroll expenses divided by 12
  • When calculating payroll costs, any amount in excess of $100,000 paid to any employee must be deducted from total payroll expenses
  • If the borrower has a NAICS code beginning with 72 (hospitality, restaurants, etc.), the calculation is 3.5 times the average monthly payroll cost
  • Schedule F borrowers will use gross income (Line 9) limited to $100,000 divided by 12 and multiplied by 2.5

Applications and Instructions

Please use the following links to the most current applications for First Draw PPP or Second Draw PPP loans and instructions for submitting applications and supporting documentation to Availa Bank. 

  • Availa Bank submission instructions – CLICK HERE
  • First Draw PPP Application Form 2483 – CLICK HERE
  • Second Draw PPP Application Form 2483-SD – CLICK HERE


Loan forgiveness will be similar to the first round with 60% or more of your loan amount needing to be spent on payroll expenses.  SBA has been directed to provide a simplified process for applying for forgiveness.  We anticipate new forms and instructions to be provided in the coming week and will provide links to those resources when received.

Availa Bank is proud to help small businesses across Iowa during the coronavirus crisis. In the 1st round of PPP, we issued 871 loans to help businesses keep workers on the payroll through the Paycheck Protection Program. More than 30% of these loans have been for less than $10,000 and are critical to the small businesses in our communities.

Thank you to our branch employees who made this possible.