Levenfeld Pearlstein LLC Law Provides Updated Guidance on SBA’s PPP Economic Necessity Certification, plus Manufactured Housing Investing, Stock Updates

The markets have largely been sliding for three days. As stunning as it may have sounded a mere 60 to 90 days ago, there are those who think that the markets are overpriced.

But the focus tonight is more on the small businesses that are found on Main Street than on Wall Street.

Tonight’s featured focus is the Small Business Administration’s Paycheck Protection Program (PPP) loans.

Levenfeld Pearlstein LLC has told MHProNews today that certain new guidance today should set millions of SBA PPP loan recipients at ease.

However, CNN reports that there are other hoops that SBA PPP loan recipients need to keep in mind if they want the loan to be ‘forgiven.’

Those items will be our featured focus. They are found beyond our signature left-right media headlines, standard business nightly thought-provoking fare, and our standard market snapshots. Note to our growing numbers of new readers: manufactured housing industry connected equities are found beyond the related reports.

 

Quotes That Shed Light…

 

 

Headlines from left-of-center CNN Business

• Sinking sales, big bonuses
• A JC Penney store in midtown Manhattan, May 6, 2020.
• JCPenney gives executives hefty payouts ahead of deadline for possible bankruptcy filing
• Dow closes down, posting its worst day this month
• Millions more jobless claims expected tomorrow
• Goldman Sachs issues warning about US unemployment
• Why Gen Z will be hit the hardest by the financial fallout from coronavirus
• This is the most expensive time to buy stocks in 20 years
• Cloud ETFs are all the rage as more people work from home
• America is trailing in the clean energy race
• Elizabeth Warren: 10 worker protections that should be in the US government’s next aid package
• After years without turning a profit, Tesla is now poised to be a powerhouse
• Consumers are having a tougher time getting credit — and keeping it
• French parliament passes law requiring social media companies delete certain content within an hour
• WASHINGTON DC, USA – MARCH 9: Elon Musk, Founder and Chief Engineer of SpaceX, speaks during the Satellite 2020 Conference in Washington, DC, United States on March 9, 2020.
• Analysis: What happened to Elon Musk?
• Kurt Huffman owns the restaurant group ChefStable in Oregon.
• These small business owners got PPP loans, but they’re afraid to use them
• WASHINGTON, DC – APRIL 28: A man shops in the meat section at a grocery store, April 28, 2020 Washington, DC. Meat industry experts say that beef, chicken and pork could become scarce in the United States because many meat processing plants have been temporarily closed down due to the coronavirus pandemic. Tyson Foods took out a full page advertisement over the weekend in several major American newspapers, warning that the food supply chain is on the cusp of breaking.
• Grocery prices soar. Here’s what’s getting more expensive
• MARKETS
• ECONOMY
• A traditional farm in the beautiful landscape of South Dakota.
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• Some companies are thriving. The rest are in trouble
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• Consumer prices are tumbling at an alarming rate
• Opinion: Consumers might be too optimistic — there may be a ‘Lehman moment’ coming
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• He lost his life savings in a hack. How you can try to protect yourself
• Security flaw puts millions of computers at risk
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• How your passwords can end up for sale on the dark web
• A badly-coded computer virus changed the world 20 years ago

 

Headlines from right-of-center Fox Business

• POLITICS
• Trump ‘totally’ disagrees with Fauci on school reopenings
• The debate comes as states are investigating an unknown illness appearing in children that may be linked to COVID-19.
• List of Obama administration officials who sought to ‘unmask’ Michael Flynn released
• Oil prices slide even as stockpiles shrink for first time in 16 weeks
• CHINA
• American researchers hunting for coronavirus cure hit with cyberattack from China: FBI, CSIA
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• MARKETS
• Stocks tank as coronavirus crisis looks far from over and Trump clashes with China
• Cisco profits jump on coronavirus-prompted work-from-home apps
• POLITICS
• To ease coronavirus-affected NY, Cuomo believes SALT cap repeal is ‘single best’ action
• OPINION
• 3 essential money tips financial advisers are giving their clients right now
• SOCIAL IN-SECURITY
• PERSONAL FINANCE
• Retirement benefits could be severely slashed sooner than you may think
• ‘HONEST DAY’S WORK’
• TESLA
• Tesla worker responds after Elon Musk reopens factory despite lock down
• TAX TIP
• MONEY
• IRS says employers can allow mid-year changes to dependent-care accounts
• THE PRICE IS WRONG
• AMAZON
• Huge surge in price-gouging in America leads Amazon to demand new law
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• MCDONALD’S
• McDonald’s unveils coronavirus reopening plan
• ROCKERS KICKED
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• First live concert in Arkansas in weeks served cease and desist
• ‘MAJOR LIFE CHANGE’ FOR ALL
• HEALTH
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• TOO GOOD TO BE TRUE
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• What is a money mule scheme?
• NEW STADIUM, NEW LOOK
• NFL
• LA Rams unveil new uniforms with modern twist ahead of SoFi move
• AVOID UNINTENTIONAL FRAUD
• PERSONAL FINANCE
• Coronavirus PPP loan recipient deadline fast approaching
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• Florida welcomes all public sports to play as state loosens restrictions
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• BRISK BUSINESS
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• States reopening despite coronavirus see sales increase, survey finds
• CASH BACK NOW!
• AIRPLANES
• Airlines would give cash refunds for coronavirus cancellations under bill
• SHUT DOWN CITIES
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• Cities with highest unemployment rates
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• Haven CEO steps down, new coronavirus focus for the exec
• LIFESTYLE
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• NASCAR’s return from coronavirus pause will be ‘wild,’ driver Aric Almirola says
• SPORTS
• NASCAR’s return from coronavirus pause will be ‘wild,’ driver Aric Almirola says
• PERSONAL FINANCE
• Coronavirus and PPP fraud: Who the government is watching
• INDUSTRIALS
• Airbus examining restructuring including job cuts -sources
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• GOLDMAN SACHS
• Goldman Sachs CFO says bank’s lending to energy, hotel, airline sectors isn’t ‘material risk’
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• COLLEGE
• How many college students say they’re comfortable returning to campus in fall

 

10 Market Indicator Closing Summaries – Yahoo Finance Closing Tickers on MHProNews…

Featured Focus – Where Business, Politics and Investing Can Meet

CNN Business today said the following.

• These small business owners got PPP loans, but they’re afraid to use them
• Many small business ownerswho received loans from the federal Paycheck Protection Program say the program’s rules are forcing them to make a difficult decision: Either take on more debt or spend money in ways that don’t actually benefit their business.
• “It’s a catch-22,” said Rick Schmutzler, founder of GYM Sportsbar, with locations in New York, Los Angeles and Fort Lauderdale.
• At issue is a key rule that says in order for a PPP loan to be forgiven, a small business owner must spend at least 75% of it on payroll expenses in the first eight weeks of the loan. The remaining 25% may be spent on mortgage interest, rent, utilities and interest on other business-related debt obligations.
• That means for businesses that had to shutter and let employees go, they must rehire their workers — many of whom just started receiving unemployment benefits — and pay them for eight weeks even though there is no work for them to do. Then one of two things will happen: the business won’t be allowed to reopen yet and its employees will have to go back on unemployment; or the business may reopen, but have a hard time paying employees because it’s unlikely to turn a profit quickly.
• If the business doesn’t spend the money according to the rules, they must pay back whatever portion of the loan isn’t forgiven at a 1% interest rate over two years.

 

That’s just one set of issues for already stressed small business owners to ponder. On the bright side, another prior concern may have just had a ray of sunshine.

 

On May 13, 2020, Levenfeld Pearlstein law-firm told MHProNews via a media release the following. Quoting:

• The SBA issued new FAQ#46 this morning, which clarified that PPP loans under $2 million will automatically be deemed to meet the economic necessity certification. For loans over $2 million, if during the course of the SBAs audit of that loan they determine that a borrower does not have an adequate basis for the economic necessity certification, if the borrower repays the loan, the SBA will not pursue administrative enforcement with respect to the economic necessity certification.
• The full text of FAQ#46 is reproduced below (emphasis added) and a link to the FAQ page is here.

 

“FAQ#46 – Question: How will SBA review borrowers’ required good-faith certification concerning the necessity of their loan request?

Answer: When submitting a PPP application, all borrowers must certify in good faith that “[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.” SBA, in consultation with the Department of the Treasury, has determined that the following safe harbor will apply to SBA’s review of PPP loans with respect to this issue: Any borrower that, together with its affiliates, received PPP loans with an original principal amount of less than $2 million will be deemed to have made the required certification concerning the necessity of the loan request in good faith. SBA has determined that this safe harbor is appropriate because borrowers with loans below this threshold are generally less likely to have had access to adequate sources of liquidity in the current economic environment than borrowers that obtained larger loans. This safe harbor will also promote economic certainty as PPP borrowers with more limited resources endeavor to retain and rehire employees. In addition, given the large volume of PPP loans, this approach will enable SBA to conserve its finite audit resources and focus its reviews on larger loans, where the compliance effort may yield higher returns. Importantly, borrowers with loans greater than $2 million that do not satisfy this safe harbor may still have an adequate basis for making the required good-faith certification, based on their individual circumstances in light of the language of the certification and SBA guidance. SBA has previously stated that all PPP loans in excess of $2 million, and other PPP loans as appropriate, will be subject to review by SBA for compliance with program requirements set forth in the PPP Interim Final Rules and in the Borrower Application Form. If SBA determines in the course of its review that a borrower lacked an adequate basis for the required certification concerning the necessity of the loan request, SBA will seek repayment of the outstanding PPP loan balance and will inform the lender that the borrower is not eligible for loan forgiveness. If the borrower repays the loan after receiving notification from SBA, SBA will not pursue administrative enforcement or referrals to other agencies based on its determination with respect to the certification concerning necessity of the loan request. SBA’s determination concerning the certification regarding the necessity of the loan request will not affect SBA’s loan guarantee.”

 

Prior reports on the SBA PPP, small business issues and related are linked below.

Related Reports:

NFIB Small Business April Data Mix of Dark, Bright Spots, plus Manufactured Home Stock, Investing Updates

Manufactured Housing Industry Investments Connected Closing Equities Tickers
Some of these firms invest in manufactured housing, or are otherwise connected, but may do other forms of investing or business activities too.

• • • • • • • NOTE: The chart below includes the Canadian stock, ECN, which purchased Triad Financial Services, a manufactured home industry lender
            • NOTE: Drew changed its name and trading symbol at the end of 2016 to Lippert (LCII).

Spring 2020…
Berkshire Hathaway is the parent company to Clayton Homes, 21^st Mortgage, Vanderbilt Mortgage and other factory built housing industry suppliers.
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That’s a wrap on this installment of “News Through the Lens of Manufactured Homes and Factory-Built Housing” © where “We Provide, You Decide.” © (Affordable housing, manufactured homes, stock, investing, data, metrics, reports, fact-checks, analysis, and commentary. Third-party images or content are provided under fair use guidelines for media.) (See Related Reports, further below. Text/image boxes often are hot-linked to other reports that can be access by clicking on them.)

By L.A. “Tony” Kovach – for MHLivingNews.com.
Tony earned a journalism scholarship and earned numerous awards in history and in manufactured housing. For example, he earned the prestigious Lottinville Award in history from the University of Oklahoma, where he studied history and business management. He’s a managing member and co-founder of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com. This article reflects the LLC’s and/or the writer’s position, and may or may not reflect the views of sponsors or supporters.
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