FOOD & AGRICULTURE QUARTERLY | JUNE 2020
economic uncertainty made the PPP loan necessary to
support ongoing operations. SBA guidance has clarified
that borrowers, in making this determination, must take into
account “their current business activity and their ability to
access other sources of liquidity sufficient to support their
ongoing operations in a manner that is not significantly
detrimental to the business.” The SBA has declared that a
borrower whose loan, combined with its affiliates’ loans,
is under $2 million will be deemed to have made this
certification in good faith.
Considerations for Seasonal Employers
Significantly to agricultural businesses, the PPP is available
to seasonal employers. Any seasonal employer, such as a
farmer, who may have been dormant on Feb. 15, 2020 can
still be eligible if it was operating for any 8-week period
between:
∙ Feb. 15, 2019 and June 30, 2019; OR
∙ May 1, 2019 and Sept. 15, 2019.
Seasonal employers calculate their loan amount differently
than non-seasonal employers. Generally, the loan amount is
determined by multiplying monthly payroll costs by 2.5. For
non-seasonal employers, monthly payroll costs are usually
determined by dividing 2019 payroll or payroll from the
past year by 12. However, seasonal employers can choose
one of three time periods in calculating the amount of its
loan:
∙ Feb. 15, 2019 – May 10, 2019
∙ March 1, 2019 – June 30, 2019
∙ May 1, 2019 – Sept. 15, 2019
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