Dear Community Partners:
In recent days, the Illinois Department of Human Services (IDHS) has received many important questions about participation in the Paycheck Protection Program (PPP), such as who should apply, and whether certain organizations meet the PPP’s economic requirements.
First, any IDHS provider whose ability to provide services has been impacted, either in whole or in part, by the COVID-19 pandemic, is strongly encouraged (i) to apply for PPP funding and (ii) if successful in applying, to keep the federal PPP funds provided. If you need additional clarification on this, please reach out to your program division.
IDHS makes this recommendation to maximize funding for State providers and to ensure that limited State funding is stretched as far as possible, particularly in light of increasing economic uncertainty and diminishing State revenues due to the COVID-19 pandemic.
As noted previously, providers cannot seek and receive payments from both the State and the federal PPP program for the same cost (i.e. a provider cannot be paid twice for the same obligation). To do so, could result in criminal, civil, regulatory, and/or audit issues for the provider.
Providers whose ability to perform has not been impacted by the COVID-19 pandemic (i.e. providers who are able to fully perform and to be paid for that performance) are not encouraged by IDHS to apply, but must make their own, independent determination as to whether they should.
While providers will need to make their own, independent determinations, providers who are unable to perform, either in whole or in part, due to the COVID-19 pandemic should meet the PPP program “current economic uncertainty” requirements, making their “loan request necessary to support the ongoing operations of the applicant.” This letter can be used in support.
As providers know all-too-well, IDHS and its providers are living through significant economic uncertainty. While IDHS is trying to support providers with retention payments, federal support is necessary to ensure the long-term operations for many providers and to maximize IDHS’s and the State’s limited funding.
We do not know how long the COVID-19 pandemic will last, but we do know that without ongoing federal support, IDHS retention payments for services not performed will not be sustainable. With reduced State revenues, there is uncertainty as to IDHS’s funding capacity, cash flow, and when IDHS’s service delivery system will be able to return to something close to normal.
So, while IDHS is committed to maintaining retention payments, at a minimum, for FY2020, while the pandemic continues, “current economic uncertainty” supports federal funding for providers whose performance has been impacted, both to support providers and to maximize limited State funds.
IDHS is grateful to every provider making good faith efforts to secure and to retain federal funding. Both directly and indirectly, this helps the provider, IDHS, the State, and the social and human services system everyone is counting on to get Illinois through this unprecedented challenge.
Thank you,
Grace B. Hou
Secretary, IDHS