Businesses struggling to stay afloat amid the coronavirus pandemic but shut out of stimulus programs could see renewed relief as Speaker Nancy Pelosi (D-Calif.) and the House move to rework the Paycheck Protection Program (PPP).
The strict conditions of the forgivable PPP loans ended up excluding some of the neediest small businesses, prompting leaders across both party lines to find a solution. Many small and medium-sized businesses (SMB) said they couldn’t meet terms like rehiring all laid-off employees and using all of the money within eight weeks.
“In this case, we were hearing the exact same thing from all of the small businesses in our districts,” Rep. Dean Phillips (D-Minn.) told Politico regarding the bill draft being worked on with Rep. Chip Roy (R-Texas). “We were perfectly aligned and we both recognized that to move legislation under these circumstances there has to be bipartisan genesis.”
House leaders are hoping to vote next week on bipartisan legislation that would open the loan program to more businesses trying to survive the unprecedented shutdown and stay-home mandates.
“These provisions are not political,” said Roy, who worked on the changes with Phillips. “These provisions are generally well-accepted, generally bipartisan, generally desired by small businesses across the entire country.”
Last week the House passed a new $3 trillion relief package — dubbed the Heroes Act — to assist businesses, households, local governments, the U.S. postal service and frontline workers. It also includes money to help people pay rent, mortgages and utilities. Most Republicans and some Democrats are against the bill, and it’s not likely to pass the Senate.
Regardless of the new funding proposed, House and Senate leaders across party lines agreed that the problems with the SMB loan program had to be addressed. Restaurants, among the hardest-hit industry sectors, have said they couldn’t apply for the loans due to the strict requirements for forgiveness.
A PYMNTS study last month of more than 1,200 SMBs indicated that the loans are viewed not just as “must-have” protection needed to navigate the current challenges, but also as tools that can be used strategically, to position SMBs in a post-pandemic world.