Colleges suffering from lost earnings during the pandemic may have a better chance now that clarification of the Paycheque Protection ProgramThe rules of (PPP) state that these institutions can exclude work-study students from their final employee counts, according to Bloomberg.
In doing so, many colleges will be able to claim to have fewer than 500 employees, thus making them eligible for the P3 Small Business Classification.
As the pandemic forced people not to spend overcrowded time in public spaces, colleges and universities have sent students home. Because of this, many institutions had to reimburse room and board costs, which forced them to face financial deficits.
The rules were changed after protests from several lawmakers, and Congress found itself agreeing that the PPP should benefit colleges.
The National Association of Independent Colleges and Universities said the move would not solve the problems for many schools because many colleges have students working on campus who are not funded by federal or government grants.
These students should be included in the number of employees and could jeopardize loan eligibility.
Georgia-based Covenant College will benefit from the program, according to President Derek Halvorson. The college had received a loan of $ 3.2 million but was not sure whether it was allowed to use it. The college has 129 students in a federal work-study program which can now be left out.
The PPP allocates loans that do not have to be repaid if the beneficiaries use most of the money for payroll and maintaining the business. The second round of financing, amounting to 320 billion dollars, was adopted in late April after the first round was wiped out within days.
Colleges and Universities do not know how they will work in the future. Everything from attending in-person classes to managing prices with the massive disruption is on hold.