A nearly $500 billion coronavirus aid package flew through the Senate on Tuesday after Congress and the White House reached a deal to replenish a small-business payroll fund and provided new money for hospitals and testing. (April 21)
WASHINGTON – The House is preparing to vote on changes to the government’s small business loan program next week that will offer more flexibility to companies affected by the coronavirus after widespread concerns by some businesses about strict mandates.
The changes to the Paycheck Protection Program (PPP), designed to help struggling businesses stay alive and keep paying their workers during the pandemic, is likely to garner bipartisan support in both the House and Senate as lawmakers on both sides of the aisle have voiced support for fixes to the landmark program. It’s likely to be one of the first measures the House will vote on by proxy to limit the number of lawmakers gathering in the U.S. Capitol, though exact timing on the vote hasn’t been released yet.
“We saw a quick fix on how we could make this work better,” House Speaker Nancy Pelosi, D-Calif., said Wednesday on the need to address changes with the PPP at her weekly press conference. “We couldn’t ignore that.”
The bill, from Reps. Dean Phillips, D-Minn. and Chip Roy, R-Texas, would extend the amount of time businesses have to have to rehire employees beyond the June 30 deadline while also extending the loan forgiveness period as some business are unable to reopen as quickly as others.
The legislation would also offer other flexibilities, such as on the mandate that in order for loans to be forgivable by the government, businesses must spend 75% of the funds on payroll. Phillips and Roy noted that payroll does not represent such a large amount of some businesses’ expenses and the 25% leftover might not leave enough for rent and other expenses.
“These common-sense solutions will provide the flexibility necessary to weather the storm and prepare for uncertain times ahead,” Phillips said in a statement announcing the bill last week.
The PPP was part of the $2.2 trillion emergency stimulus package approved in March. It provides business owners with 500 or fewer workers low-interest loans to stay afloat. Those loans would be forgiven by the government if at least 75% of the money goes to keeping employees on the payroll, which would basically amount to grants for these businesses.
The House passed a $3 trillion measure last week that addressed some of these changes to the PPP but the Senate is not planning to take up the bill, with many Republicans decrying the legislation as a Democratic wish list.
Many Senate Republicans have stressed they want to hit pause on passing more funds to address the pandemic in order to examine how the nearly $3 trillion already passed is working and whether more money will be needed as the country works to reopen.
But Republicans have shown an openness to addressing some changes to PPP. Sen. Marco Rubio, who helped craft the program as chairman of the Senate Small Business Committee, signaled that addressing some of these concerns could garner near-unanimous support in the Senate if the legislation focused solely on PPP and bipartisan fixes.
“We are hearing of course now from a lot of small businesses who got PPP loans but are saying to us, that they can’t spend all the money on payroll — 75 percent of the money on payroll — within 8 weeks. They need 12 weeks or 16 weeks because they are just starting to reopen now because there are different rules in different places,” he explained. “And what I have found is that up here, if we just had a straight up vote on whether or not we should extend or change the bill to say instead of 8 weeks you have 12 weeks or 16 weeks to spend money on payroll, it would probably get 99 or 98 votes.”
Rubio, R-Fla., told reporters that he hoped the fixes could be addressed soon by the Senate and did not expect it to be a controversial vote.
The paycheck protection program is supposed to provide billion of dollars in emergency loans to help small businesses keep workers on the job. But many small business owners say there’s a bottleneck that’s been slowing the process for weeks. (April 30)
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