Quantcast

Photo via Google Maps

Members of the New York Congressional Delegation are seeking clarification on Payroll Protection Program (PPP) loan eligibility for residential housing cooperatives in a letter sent Tuesday to the Trump Administration. 

Congress members Nydia Velazquez, chairwoman of the House Small Business Committee, Grace Meng, Eliot Engel, and Senate Minority Leader Chuck Schumer and other members of the delegation sent a letter to Treasury Secretary Steven Mnuchin and Small Business Administration Administrator Jovita Carranza. 

The lawmakers are pressing the agencies to issue guidance clarifying the eligibility of housing co-ops for the PPP. 

“In New York City alone, there are nearly 100,000 cooperative housing units, providing affordable middle-class housing to thousands of New York City, Long Island and Westchester residents,” the lawmakers said. “Lost or deferred cooperatives fees from its member-owners, coupled with increases in utilities due to the stay at home orders, have made it increasingly difficult for these cooperatives to maintain their employees.”

According to the lawmakers, housing co-ops rely on a steady stream of revenue to pay maintenance and building staff, conduct repairs and maintain facilities. During the COVID-19 pandemic, financial hardship has been compounded by confusion surrounding whether housing co-ops are eligible to apply for PPP loans, which are forgivable if a borrower meets certain criteria. 

Congress enacted the Coronavirus Aid, Relief, and Economic Security (CARES) Act to provide economic relief to small businesses and eligible nonprofits during the pandemic, with the intent to keep their employees on staff. 

However, the lawmakers said, On April 2, the SBA issued an interim final rule that states residential cooperatives were ineligible for PPP loans. 

“Yet, the Department of Treasury’s Frequently Asked Questions (FAQ) number 35 states that, ‘As long as other PPP eligibility requirements are met, small agricultural cooperatives and other cooperatives may receive PPP loans,’” the lawmakers said. 

The SBA subsequently issued an interim final rule on May 14 to specify that nonprofit 501(c)(12) electrical cooperatives are eligible for PPP loans. 

The lawmakers are requesting that the conflicting information is clarified by expounding on the response to FAQ #35, and clearly state that housing cooperatives are eligible for PPP loans and any related benefits.

“The PPP loans would enable these entities to continue to pay their valued employees during these uncertain times,” the lawmakers said. 

Comments:

Join The Discussion





Skip to toolbar