Paycheck Protection Program (PPP) loans were a critical lifeline that enabled small engineering firms to continue to pay their employees and provide services to their clients. However, a minor provision in the Federal Acquisition Regulation (FAR) known as the "credits clause” is being interpreted in a way that would force firms to give those funds back in the form of a refund or credit in billing rates in the amount of the forgiven PPP loan that are allocable to contract costs. In fact, some firms could actually lose more than the amount of their PPP loan, especially in the case of multi-year contracts that lock in the reduced billing rate. And the impact unfairly penalizes engineering firms - construction contractors and other businesses working for State DOTs are not subjected to this restriction and can keep the full amount of their forgiven PPP loans.
At the same time, firms are being asked to work under the historically low 2020 audited overhead rates resulting from the pandemic, while having to bear the ever increasing actual overhead costs of 2021 and beyond.
Find out how ACEC is working to mitigate these policies. Join ACEC National's Steve Hall and Georgia DOT's William Jones for a Q&A discussion about potential solutions at the Federal and State level.
William Jones, Audit Manager, GDOT
Steve Hall, Senior Vice President for Advocacy & External Affairs, ACEC