Essintial Enterprise Solutions LLC v. SBA - PPP Loan Forgiveness

PRECEDENTIAL UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT ____________ No. 25 -1367 ____________ ESSINTIAL ENTERPRISE SOL UTIONS, LLC v. THE UNITED STATES SMALL BUSINESS ADMINISTRATION; ADMINISTRATOR UNITED STAT ES SMALL BUSINESS ADMINISTRATION; SECRETARY UNITED STATES DEPARTMENT OF TREASURY; THE UNITED STATES OF AM ERICA, Appellants. ____________ On Appeal from the United States District Court for the Middle District of Pennsylvania (No. 1:22- cv -01507) District Judge: Honorable Julia K. Mu nley ____________ Argued: December 3, 2025 Before: CHAGARES, Chief Judge, FREEMAN and BOVE, Circuit Judges. (Filed: February 3, 2026)

2 ____________ Adam C. Jed [ARGUED] United States Department of Justic e Civil Division 950 Pennsylvania Avenue NW Washington, DC 20530 Patrick J. Bannon Michael J. Butler Office of United States Attorney Middle District of Pennsylvania 235 North Washington Avenue P.O. Box 309, Suite 311 Scranton, Pennsylvania 18503 Counsel for Appellants Bret S. Wacker [ARGUED] J. Chris White Clark Hill 1400 Wewatta Street Suite 550 Denver, Colorado 80202 Danny P. Cerrone, Jr. Clark Hill 301 Grant Street Fourteenth Floor Pittsburgh, Pennsylvania 15219 Cynthia Filipovich Clark Hill 500 Woodward Avenue Suite 3500 Detroit, Michigan 48226 Counsel for Appellee

3 ____________ OPINION OF THE COURT ____________ BOVE, Circuit Judge. The Small Business Administration (SBA) appeals a finding that the agency violated the Administrative Procedure Act by declining to fully forgive a Paycheck Protection Program loan. The appeal turns on whether the borrower’s payments to independent contractors were “payroll costs” under the Program’s statutory definition of that term. The interpretive question is not a routine ground ball. The District Court said yes, ruling that payments to indepe ndent contractors were covered. As did ano ther district jud ge in the Western District of Louisiana. A district judge in the Eastern District of Michigan sided with the SBA and said no. So too did t wo Circuits. The Third will be t he third. So we will reverse. I. This case arose out of a $7 million loan issued to Essintial Enterprise Solutions, LLC through the Paycheck Protection Program (PPP). Essintial provides staffing and other services to customers in several industries. We get into the details below, but the gist is that Essintial sued the SBA when the SBA refused to forgive the entire loan. The District Court resolved the parties’ dueling interpret ations of the relevant statutory definition in Essintial’s favor. This a ppeal followed. A. Following the President’s March 13, 2020 emergency declaration relating to the COVID-19 pandemic, Congress

4 established the PPP in the Co rona virus Aid, Relief, and Economic Security (CARES) Act, Pub. L. No. 116-136, 134 Stat. 281 (2020). The CARES Act included the PPP, which “aimed to help small businesses keep workers employed during the crisis, by providing forgivable, low-interest, federally guaranteed loans to keep employees on the payroll.” Seville Indus., L.L.C. v. SBA, 144 F.4th 740, 742 (5th Cir. 2025). 1 Eligible applicants could borrow up to $1 0 million from a private lender, guaranteed by the SBA, based on a formula relating to “payroll costs.” See 15 U.S.C. § 636(a)(36)(E); see also id. § 636(a)(36)(A)(viii) (defining “payroll costs”). Borrowers were eligible for loan forgiveness to the extent loan proceeds were used for specified expenses, including “payroll costs.” Id. § 636m(b)(1). The President signed the CARES Act into law on March 27, 2020. The SBA was required to issue implementing regulations within a mere 15 days. See 15 U.S.C. § 9012. On April 2, 2020, the SBA published an Interim Final Rule on its website, no t effective until April 15, which differentiated between types of “payroll costs” for a traditional business with “employees” and “for an independent contractor or sole proprietor.” 85 Fed. Reg. at 20813. The Rule confirmed that independent contractors did not “count as employees” because contractors “ have the ability to apply for a PPP loan on their own . . ..” Id. On the same day that the SBA issued the Interim Final Rule, the lending bank advised Essintial’s principal that “1099 employees are allowed to be included i n payroll costs” for 1 Unless otherwise indicated, case quotations omit all internal citations, quotation marks, footnotes, alterations, and subsequent history.

5 purposes of a PPP loan. A 45. On April 4, 2020, Essintial applied for a PPP loan in the amount of $7,219,862. Essintial reported that it had 359 “employees” and calculated the loan amount based on an “Average Monthly Payroll” of $2,88 7,945. Like the Interim Final Rule, the instructi ons on the application form differentiated between payroll costs for a traditional business and “for an independent contractor or sole proprietor.” A 64. On April 20, 2020, the bank loaned Essintial $7,028,800, on a two-year term at 1% interest. When Essintial sought forgiveness of the loan in Ja nuary 2021, the company indicated that it had only 276 “employees” at the time of the loan application. In the forgiveness application, Essintial acknowledged that the SBA “may request additional information for the purposes of evaluatin g the Borrower’s eligibility for the PPP loan and for loan forgiveness.” A 75. The bank agreed to forgive the entire loan, but the SBA opened a review of that determinati on later in January 2021. In June 2021, the SBA notified Essintial that “ [t]he loan documentation does not fully support the disbursed loan amount” because “ineligible payroll expenses were included in the calculation of the loan amount: 1099 Contractor costs.” A 81. After some number crunching, the SBA forgave $3, 703,011.60 of t he loan. The SBA’s Offic e of Hearings and Appeals affirmed the SBA’s determinati on in May 2022. B. In September 2022, Essintial sued the SBA and related government actors in an effort to recover the unforgiven aspects of the PPP loan. Essintial contended that the SBA’s forgiveness decision violated the Administ rative Procedure

6 Act and argued that the SBA had relied on an improper retroactive application of the I nterim Final Rule. The District Court granted summary judgment to Essintial and held that the SBA’s decision was arbitrary and capricious. See Essintial Enter. Sols., LLC v. SBA, 2024 WL 5248242 (M.D. Pa. 2024). The court ruled that the SBA did not retroactively apply the Interim Final Rule, but that the SBA erred by interpreting the definition of “payroll costs” in the CARES Act to exclude Essintial’s payments to independent contractors. See id. at *4-9. The SBA timely ap pealed. II. The District Court had jurisdiction under 28 U. S.C. § 1331. We have jurisdiction unde r 28 U.S.C. § 1291. The Administrative Pr ocedure Act directs courts to set aside final agency actions that are arbitrary, ca pricious, or contrary to law. See 5 U.S.C. § 706(2)(A). We conduct de novo review of statutory interpretations in support of § 706(2) analysis and legal conclusions in summary judgment decisions. See Axalta Coating Sys. LLC v. FAA, 144 F.4th 467, 472 (3d Cir. 2025); see also Jor ja ni v. N.J. Inst. of Tech., 151 F.4th 135, 140 n.5 (3d Cir. 2025). III. We hold that t he SBA’s interpretation of “payroll costs” under the CARES Act did no t violate the Administrative Procedure Act. Reasonable minds could differ on this on e, and some already have. Compare Veltor Underground, LLC v. SBA, 143 F.4th 727 (6th Cir. 20 25), and Sevi lle Indus., 144 F.4th at 742, with Essintial, 2024 WL 5248242, and Seville Indus. LLC v.

7 SBA, 2024 WL 697592 (W.D. La. 2024). But in our view, the CARES Act included two alternative definitions of “payroll costs. ” 15 U.S.C. § 636(a)(36)(A)(viii) (I). The term “means” one of tw o things depending on the type of borrower. Id. The two options are set forth in subsections (aa) and (bb) of the definition. Subsection (aa) defines payroll costs for a traditional business that has “employees.” Subsection (bb) defines pay roll costs for “a sole proprietor or independent contractor, ” and it does not cover Essintial’s payments to such a contractor. While this interpretation of § 636(a)(36)(A)(viii) (I) is no t the on ly option, it is the sin gle, best meaning based on the statutory text and structure. A. “ [S]tatutes, no matter how impenetrable, do — in fact, must —have a single, best meaning.” Loper Bright Enters. v. Raimondo, 603 U.S. 369, 400 (2024). “The words on the page, not the intent of any legislator, go through bicameralism and presentment and become law.” United States v. Safehouse, 985 F.3d 225, 239 (3d Cir. 2021). Statutes resulting from this process “ are the law.” Travers v. Fed. Express Corp., 8 F.4th 198, 202 n.9 (3d Cir. 2021). Thus, “every statute’s meaning is fixed at the time of en actment . . ..” Wis. Cent. Ltd v. United States, 585 U.S. 274, 284 (2018). Experience teaches that a statute’s fixed meani ng is not obvious in every instance. For example, questions can pop up about the meaning of st atutory text when “new applications. . . arise in light of changes in the world.” Wis. Cent., 585 U.S. at 284. When that happens, “ even if a word can bear more than one meaning, it is t he best ordinary reading of a statute we seek.” United States v. Johnman, 948 F.3d 612, 618 n.6 (3d Cir. 2020). That is, we look to the “ordinary, contemporary, common” public meaning of the

8 words at issue at the time the law was passed. Perrin v. Unit ed States, 444 U.S. 37, 42 (1979); see also Lopez v. AG, 49 F.4th 231, 234 n.4 (3d Cir. 2022). Identifying a disputed term’s single, best meaning in the context of a justiciable controversy is one of our main jobs. The District Court deviated from that task in modest but noteworthy ways that contributed to an erroneous conclusion. Despite acknowledging that Lo per Bright overruled Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), the District Court fixated at times on “whether or not [the] statute is ambiguous, ” including based on “ case law interpreting the first step of Chevron.” Essintial, 2024 WL 5248242, at *5 n.7. Loper Bright laid to rest the “Snark hunt” for ambiguity. 603 U.S. at 437 (Gorsuch, J., con curring); see also id. at 407- 08 (explaining that the “defining feature” of Chevron was “the identification of statutory ambiguity . . . [b]ut the concept of ambiguity has always evaded meaningful definit ion”). The District Co urt also operated under the related misimpression that, in the absence of a specified ambiguity in the statutory definition, the court “need not refer ” to “various statutory sections” cited by the SBA ou tside of the statutory definition. Essintial, 2024 WL 5248242, at *9. The sc ope and application of “payroll costs” was plainly subject to a reasonable dispute between the parties here. And “ interpretation of a phrase of uncertain reach is not confined to a single sentence when the text of the whole statute gives instruction as to its me aning.” Star Athletica, L.L.C. v. Varsity Brands, Inc., 580 U.S. 405, 41 4 (2017). Consequently, it was error to confine the SBA’s arguments about other relevant features of the CARES Act to a footnote without analysis. See Essintial, 2024 WL 5248242, at *9 n.9. In fact, those

9 arguments are among the contentions that convince us that the SBA is correct about the definiti on of “payroll cost s.” B. Turning to that definition, Congress used two subsections to create alternative meanings of “payroll costs.” 15 U.S.C. § 636(a)(36)(A)(viii)(I). Su bsection (aa) addresses types of compensation provided by a business like Essintial to “employees,” and subsection (bb) addresses compensation provided by — not paid to —a “sole proprietor or independent contractor.” Id. The best reading of the definition is that neither subsection covers Essintial’s payments to independent contractors. For ease of reference, the definitio n looks like this: (viii) the term “payroll costs” — (I) means — (aa) the sum of payments of any compensation with respect to employees that is a — (AA) salary, wage, commission, or similar compensation; (BB) payment of cash tip or equiv alent; (CC) payment for vacation, parental, family, medical, or sick leave; (DD) allowance for dismissal or s eparation;

10 (EE) payment required for the provisions of group health care or group life, disability, vision, or dental insurance benefits, including insurance premiums; (FF) payment of any retirement benefit; or (GG) payment of State or local tax assessed on the compensation of empl oyees; and (bb) t he sum of payments of a ny compensation to or income of a sole proprietor or independent contractor that is a wage, commission, income, net earnings from self-employment, or similar compensation and that is in an amount that is not more than $100,000 on an annualized basis, as prorated for the period during which the payments are made or the obligation to make the payments is incurred Id. Section 636(a)(36)(A) (viii)(I) tells us what “payroll costs” “means.” Words preceding the em-dash that follows “means” distribute to subsections (aa) “ and ” (bb). See Sevill e Indus., 144 F.4th at 746 (citing U nited States v. Palomares, 52 F.4th 640, 650 (5th Cir. 2022) (Oldham, J., concurring)); see also United States v. P ace, 48 F.4th 741, 754 (7th Cir. 2022); Johnman, 948 F.3d at 618 (“[W]ords are to be given the meaning that proper grammar an d usage woul d assign them.”). Payroll costs “means” one thing for a business with “employees.” 15 U.S.C. § 636(a)(36)(A)(viii)(I) (aa). And another thing for “a sole proprietor or indepe ndent contractor.” Id. § 636(a)(36)(A)(viii)(I)(bb). The phrase “the sum of

11 payments” introduces each subsection and required the borrower to add up the different types of compensation covered by the applicable subsection. Id. § 636(a)(36)(A)(viii)(I)(aa), (bb). Congres s could have ca lled for the addition of pa yments arguably covered by both subsections by, for ex ample, inserting “t he sum of” between “means” and the em -dash. See Seville Indus., 144 F.4th at 749. But Congre ss did not do that. Thus, “ [t] he payment universes do not overlap.” Veltor Underground, 143 F.4th at 733. Close examination of subsec tion (bb) further demonstrates that this part of the “payroll costs” definition cannot be invoked by Essintial. The payroll costs that Congress specified in subsection (bb) —“a wage, commission, income, net earnings from se lf- employment”— are types of compensation that “sole proprietors and independent contractors obtain from (or reinvest into) their businesses.” Veltor Underground, 143 F.4th at 731; see also Seville Indus., 144 F.4th at 746 (“Subsection (bb) therefore defines payroll costs as the money earned by independent contractors or sole proprietors, not as the money paid to them by businesses.”). This is “clea r enough” with respect to “i ncome” and “net earnings from self- employment.” Veltor Underground, 143 F.4th at 732. “Only what one gets can be described as ‘income’ or ‘net earnings from self - employment,’ not what one gives.” Id. Things are admittedly murkier with respect to the “wage” and “commission” examples, which also appear in subsection (aa). We m ake sense of the overlap by refere nce to neighboring terms. See Veltor Underground, 143 F.4th at 734- 35. When situated next to “income” and “net earnings from self - employment,” as in subsection (bb), we interpret the words “wage” and “commission” to refer to additional types of

12 payments made by “a sole proprietor or ind ependent contractor.” See id. at 733 (“A business no more pays its contractors a wage or a commission when it purchases services than a business’s customers pay the business’s employees a salary when they purchase goo ds.”). In subsection (aa) on the other han d, “wage” and “commission” have a different neighbor, “salary, ” which is no t included in subsection (bb). “The difference must have significance.” Levins v. Healthcare Revenue Recovery Grp. LLC, 902 F.3d 274, 283 (3d Cir. 2018). Businesses pay salaries to employees. The same is true of the other examples in the remainder of the list that accompanies subsection (aa), such as tips, paid leave, severance, and insurance and retirement benefits. See 15 U.S.C. § 636(a)(36)(A)(viii)(I) (aa) (BB)-(GG). These are add itional types of em ployee compensation. The salient point here is that subsections (aa) and (bb) are best read as having a parallel structure with alternative definitions based on outlays of “payments and compensation” by the type of bo rrower at issue. S ubsection (bb) “adopt[s] the perspective of a sole proprietor or independent contractor and ask[s] how much he pays himself.” Veltor Underground, 143 F.4th at 733. It does not cover Essintial’s payments to i ndependent contractors. The re is more support for this interpretation in the express exclusions from the “payroll costs” definition. See 15 U.S.C. § 636(a)(36)(A) (v i ii)(II). As relevant here, “any compensation of an employee whose pr incipal place of residence is ou tside of the United States” cann ot be included in a borrower’s payroll costs. Id. § 636(a)(36)(A) (v iii)(II)(cc). This exclusion applies to subsection (aa) by virtue of the reference to an “employee,” but there is no corresponding reference to the “sole proprietor or independent contractor”

13 language from subsection (bb). Under our interpretation, “[t]hat makes sense.” Veltor Under ground, 143 F.4th at 733. It would be “freakish” for t he CARES Act “t o exclude foreign resident employees but include foreign resident independent contractors” for purposes of a traditional business calculating payroll costs. Seville Indus., 144 F.4th at 748. Zooming out, “[t]he statute as a whole confirms our interpretation. ” Star Athletica, 580 U.S. at 415. The CARES Act established “[i]ncreased eligibility” for loans. 15 U.S.C. § 636(a)(36)(D). In defining the sc ope of the increase, Congress used different subsections to differentiate between a potential borrower that “employ s... employees, ” and “individuals who operate under a sole proprietorship or as an independent contractor.” Compare id. § 63 6(a)(36)(D)(i), with id. § 636(a)(36)(D)(ii). Th e distinction and its subsection structure tracks our interpretation of the alte rnative definitions of “payroll cost s ” in subsection s (aa) and (b b). There is also a telling clue in the CARES Act provisions relating to loan forgiveness. Congress limited the grace available to borrowers who reduced the “number of employees, ” or cut those employees’ “salary or wages” by more than 25%. See Seville Indus., 144 F. 4th at 748 (citing 15 U.S.C. §§ 636m(d)(2), 636m(d)(3)(A)); Veltor Underground, 143 F.4th at 734; see also 15 U.S.C. § 636(a)(37)(J)(iv) (similar forgiveness provisions relating to second -draw PPP loans). Congress did not want the SBA for giving loans issued to borrowers who cut employees because employee retention was the stated objective of the PPP. T here is “no corresponding limitation for cuts to independent contractors.” Seville Indus., 144 F.4th at 748. We draw the same inference as the other Circuits to have reached the question. Because “[s]ubsection (bb) covers only what a sole proprietor or

14 independent contractor pays hi mself,” “Congress had little need to worry that he would get a loan and then diminish his own wages.” Veltor Underground, 143 F. 4th at 734. Finally, our interpretation of “payroll costs” prevents the absur d scenario where a business and the independent contractor that the business paid both get PPP loans based on the same payments. That happened in this case for some of the payments at issue. The certification required with PPP applications was not enough to prevent this double dipping because Essintial was only required to disclose exist ing “duplicative” loans obtained by t he company, not loans issued to third parties such as Essintial’s independent contractors. See 15 U.S.C. § 636(a)(36)(G)(i)(IV); see also Veltor Underground, 143 F.4th at 737 (explaining that the certification “ does not require the recipient to ensure that no one else has applied for funds that might cover the same expenses”). “There is no principled reason to think Congress meant to double count money spent on independent contractors, especially in a statute that is otherwise rigorous about avoiding duplication.” Seville Indus., 144 F.4th at 750. We agree with the Fifth and Sixth Circuits that Congress did not embrace duplicative draws on the public fisc in the CARES Act. This is another reason that, on balance, the SBA has it right in this case. C. In the District Court and this appeal, Essintial presented forceful arguments in support of the company’s position. W e acknowledge the strength of those contentions but decline to adopt Essintial’s interpretation of “payroll costs” because it places too much emphasis on a “hyper -literalist reading[] of the word and ” separating subsections (aa) and (bb). Palomares, 52 F.4th at 649 (Ol dham, J., concurring).

15 Essintial correctly notes the presu mption in our caselaw that “and” is used in the conjunctive. See Reese Bros. v. Un ited States, 447 F.3d 229, 23 5-36 (3d Cir. 2006). This applies to the “and” separating subsections (aa) and (bb). The question remains: “conjunctive of what?” Veltor Underground, 143 F.4th at 736. “ [T]he fact that the definition includes both (aa) and (bb) does not tell us whether (bb) refers [1] to payments a business makes to sole proprietors and independent contractors or [2] to payments that sole pr oprietors and independent contractors make to themselves.” Id. Essintial ’s push for the first option is based on an “arithmetical” reading of the statute, where “payroll costs” means “ the sum of ” the payments described in subsections (aa) “and” (bb). Seville Indus., 144 F.4th at 748. As noted above, Co ngress used that phrase to introduce each subsection —both start with “ the sum of payments of any compensation”— but not the entire definition. 15 U.S.C. § 636(a)(36)(A)(viii)(I) (emphasis adde d). We lack authority to insert those words wh ere Essintial would prefer them, and the placement chosen by Congress does not help Essintial. In an effort to put a favorable gloss on the meaning of “and,” Essintial draws our attention to several other features of the CARES Act. The company’s arguments have merit, but they do not carry the day. Fo cusing on subsection (bb), Essintial relies on a truncated quotation to argue that “payroll costs” include “compensation to. . . [an] independent contractor . . . . ” 15 U.S.C. § 636(a)(36)(A)(viii) (I) (bb). While this isolated language could be interpreted to include the payments that the SBA rejected, that is not the best reading of this phrase. Su bsection (bb) is confined to specific types of “compensation”; compensation “ that is a wage, commission, income, net earnings from self- employment,” and other “similar payments.” Id. (emphasis added). Essi ntial’s

16 payments to independent contractors do not fit within the ordinary meaning of the words Congress used to restrict the ordinary meaning of “compensa tion” in subsection (bb). In rejecting Essintial’s argument, we also find significance in the singular form that Congress assigned to “independent contractor” in subsection (bb). See Seville Indus., 144 F.4th 747; Veltor Underground, 143 F.4th at 73 3. In subsection (aa), the relevant recipients of the compensation in question are “employees,” plural. In subsection (bb), however, Congress made a “deliberate” choice to use the singular form of “independent contractor” because the entire definition is written from the standpoint of a single potential borrower with “payroll costs” to be accounted for in the loan and forgiveness applicati ons. Seville Indus., 144 F.4th at 747. Essintial also points us to the statutory exclusions from “payroll costs, ” but we have al ready found one aspect of those exclusions to support the SBA. See 15 U.S.C. § 636 (a)(36)(A)(viii)(II). The company pushes forward citing caselaw applying the expressio unius canon. Essintial contends that Congress’s failure to explicitly exclude a business’s payments to independent contractors means that such payments are impliedly covered by subsection (bb). Expressio un ius, which is “not absolute,” may serve as an interpretive aid where “Congress includes parti cular language in one section of a statute but omi ts it in another section of the same Act.” Bartenwerfer v. Buckley, 598 U.S. 69, 78 (2023). Essintial’s argument is too much of a stretch because it is based on two omissions rather than on e. The omission of payments to independent contractors from the exclusions is con sistent with the fact that Congress omitted words of sufficient clarity in subsection (bb) to cover such payments. There was nothing to exclude. At least nothing Essintial cares about in this appeal.

17 The better inference, already noted, is that Congress would have excluded payments to foreign contractors, as it did for foreign employees, if subsectio n (bb) otherwise covered a traditional business’s payments to indepe ndent contractors. See 15 U.S.C. § 636 (a)(36)(A)(viii)(II)(cc). Moving beyond the definition, Essintial relies on one of the loan -el igibility provisions of the CARES Act, which required lenders to consider wh ether a potential borrower had paid “employees” or “independent contractors, as reported on a Form 1099- MISC.” 15 U.S.C. § 636(a)(36)(F)(ii)(II)(bb). Essintial contends that borrower eligibilit y co nsiderations referencing payments to independent co ntractors would be “meaningless surplusage” if such payments were not also part of the “ payroll costs ” that are relevant to the ca lculation of the loan amount and forgiveness. Appellee ’s Br. 30. This is another argument that has some pu rcha se. See Veltor Underground, 143 F.4th at 738-39 (White, J., concurring). Yet ultimately it fails to persuade. Here, again, the si ngular-plural distinction undercuts Essintial ’s position. Similar to the “payroll costs” definition, the eligibility provision is written from the van tage point of payments by a single potential “borrower”—to “employees,” which also app ears in the definition’s subsection (aa), and “independent contractors,” which does not appear in subsection (bb). Id. § 636(a)(36)(F)(ii)(II). This parallel structure is consistent with our interpretation that subsection (bb) only covers payments received by — not payments made to — a single independent contractor seeking to participate in the PPP. Essintial’s argument is also weakened by the fact that these provisions serve different ends. The eligibility provision “simply does not address ho w payroll costs are determined.”

18 Veltor Underground, 143 F.4th at 737. Congress required private lenders to evaluate eligibility considerations wh en deciding whether to issue a PPP loan at all. The threshold question of eligibility had no bearing on how much should be loaned or forgiven, which are both a function of an eligible borrower’s “payroll costs” and governed by distinct provisions. Compare 15 U.S.C. § 636(a)(36)(F)(ii)(I I) (eligibility), with id. § 636(a)(36)(E) (maximum loan amount), and id. § 636m(b) (loan forgiveness). The eligibility considerations reflect anti-fraud concerns not apparent on the face of the definition of “payroll costs.” The eligibility-relat ed text indicat es that Congress sought to ensure that PPP loans were not given to new businesses that were established for the sole pu rpose of taking advantage of the Program and its expanded eligibility. See, e.g., 15 U.S.C. § 636 (a)(36)(D) (“Increased eligibilit y for certain small businesses and organizations”). We infer this purpose from the fact that, for purposes of eligibility, Congress twice ref erenced payments that could be verified with ta x records; “payroll taxes” for employees and “Form 1099 - MISC” for independent contractors. Id. § 636(a)(36)(F)(ii)(II)(bb). These ob jective considerations helped “sort the wh eat (real businesses, in need of support) from the c haff (fake businesses, established solely to capitalize on the program).” Veltor Underground, 143 F.4th at 737. Thus, while on e might wonder why Congress would care about a business’s payments to independent contrac tors for purposes of eligibility but not loan amount, the statute as a whole provides enough of an answer that any unresolved aspects of the question do not move the nee dle to Essintial’s side.

19 D. We are sympathetic to the challenges that the COVID - 19 pandemi c cre ated for Essintial and other businesses, but we do not agree with Essintial that the company was the victim of a “bait -and- switch” by the governme nt. Appellee ’s Br. 17. As a matter of law, Essintial’s argument does no t address the statutory text and therefore has limited relevance to our analysis. Essintial did no t bring an equ itable estoppel claim in the District Court, and the company has not relied on equitable estoppel here. Ty pically, equitable estoppel “will not lie against the Government as it lies against private litigants,” and “claims for estoppel cannot be entertained where public money is at stake.” OPM v. Richmond, 496 U.S. 414, 419, 427 (1990); see also Monongahela Valley Hosp., Inc. v. Sullivan, 945 F.2d 576, 588 -89 (3d Cir. 1991); Seville Indus., 144 F.4th at 750. A ny superficial app eal to the “bait and switch” claim loses traction upon examination of the record. On April 2, 2020, the lender sent Essintial an email stating that “1099 employees are allowed to be included in payroll costs.” A 45. On the same day as the email, the SBA posted contrary guidance on its website in the Interim Final Rule. See 85 Fed. Reg. at 20814. Essintial submitted the loan application two days after the conflicting guidance from the lender and the SBA. Consistent with the Rule, the app lica tion instructions stated that “payroll costs consist of compensation to employees” as well as a list of other items consistent with subsection (aa), “and for an independent contractor or sole proprietor” a list of items consistent with subparagraph (bb). A 64. Essintial represented that it had 359 “employees” in it s PPP application, and the company did not break out independent contractors in res ponse to that question.

20 We recognize that the Interim Final Rule was not effective un til April 15, 2020, an d that the Rule was not retroactive. The SBA is not asking for retroactive application or deference to its interpretation, and we afford the Rule neither of those things. Nevertheless, Essintial cannot successfully invoke equity after having received a clear indication of the government’s position prior to the issuance of the loan. Once these details are brought to the fore, the SBA’s response to Essintial’s subsequent for giveness application in 2021 was not as harsh as Essintial suggests. Certainly not enough to drive a different interpretation of the stat ute. IV. The text and structure of the CARES Act persuade us that Essintial’s payments to independent contractors were not “payroll costs” for purposes of a PPP loan. That is the best interpretation of the statute. Therefore, the SBA did no t violate the Administrative Procedure Act. Accordingly, we will reverse and remand for further proceedings consistent with this opinion.