House to Vote on Standalone Small-Business Loan Program Fixes

The House will vote next week on bipartisan legislation changing terms of the so-called Paycheck Protection Program that have served as obstacles to some small businesses seeking relief under the forgivable loan program.

On Friday, after voting for the Democrats’ massive $3 trillion coronavirus relief bill, Rep. Dean Phillips, D-Minn., announced he’d secured a commitment for a vote on his stand-alone bill that would make changes to the small-business loan program sought by hotels, restaurants and other industries. The stand-alone bill would extend the 8-week period to use the funds and the time businesses have to rehire employees, while still qualifying for loan forgiveness under the program beyond the existing June 30 deadline. It would also extend the period for paying back portions of the loans that aren’t forgiven beyond two years. The law that created the program allowed the Small Business Administration to set loan terms up to 10 years, but the agency instead put a two-year due date on them. Extending the loan terms would allow businesses to make smaller payments on the amounts that aren’t forgiven under the program. The bill would also eliminate the “75-25 rule” implemented by the White House that says businesses have to spend at least 75 percent of the loan on payroll costs and no more than 25 percent on other expenses like rent and utilities.

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