Last night the SBA issued a clarification of a very important issue affecting the hospitality industry.
The SBA is accepting the hotel management agreement, that provides for the owner to reimburse the hotel management company for all payroll costs, as akin to a PEO arrangement. Therefore, the gross payroll should be included in the average payroll calculation for purposes of the PPP loan.
Real estate clients using property management companies where the owner reimburses the property management company for the cost of maintenance and onsite management personnel should include the payroll of the maintenance and onsite personnel in their average payroll calculation.
See Question 10 on page 4 of the attachment. This is a SIGNIFICANT interpretation in favor of our real estate and hospitality clients. Revise your calculations accordingly.
Please call your BKMSH team member or Jim Ramsey at Visorie if you need further clarification.