Archive for June, 2020
Department of Treasury Announces Paycheck Protection Program Fix for Commercial Fishing Businesses, Deadline Approaches Fast
Friday, June 26th, 2020
Sen. Bert Stedman, (R-Sitka), applauded a rule today that fixed an issue for commercial fishermen who were unable to receive adequate funding under the Paycheck Protection Program. The US Department of Treasury and Small Business Administration announced a rule yesterday that will allow commercial fishing businesses to account for crew member payroll, something that was not formerly available.
However, businesses currently only have until June 30, 2020 to apply for PPP funds.
“I’m happy that our Alaskan fishermen will finally be able to receive equal opportunities for aid under the PPP program in the same way that other businesses have been able to do,” Stedman said. “Southeast Alaska relies on fishing as a huge part of our economy and food supply, and this program will help alleviate some of the stress from the major loss in revenue due to circumstances from the COVID-19 pandemic.”
The structure of commercial fishing businesses using self-employed independent contractors meant crew member payroll was unintentionally ineligible for compensation under this program originally.
Stedman urged those fishing businesses who can to apply by the June 30 deadline. However, he said his office will continue working with lenders and leaders to extend the deadline for those businesses who recently became eligible under this rule.
“Many folks are currently out on the fishing grounds and will not be able to apply for this relief,” Stedman said. “My office will work with the congressional delegation to seek an extension.”
This fix came after U.S. Senators Lisa Murkowski and Dan Sullivan (R-Alaska) and U.S. Representative Don Young (R-Alaska) sent letters to the Trump administration requesting the change.
BACKGROUND:
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.
See the full press release from Alaska’s congressional delegation here.
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