U.S. House To Vote On Improvements To Paycheck Protection Program (PPP) Next Week
Next week, the U.S. House is expected to approve bipartisan legislation to make several improvements to the Paycheck Protection Program.
H.R. 6886, the Paycheck Protection Flexibility Act, cosponsored by Reps. Dean Phillips (D-MN) and Chip Roy (R-TX), would allow businesses receiving forgivable PPP loans additional flexibility in using their loan proceeds which would:
— Allow forgiveness for expenses beyond the eight-week covered period;
— Eliminate restrictions limiting non-payroll expenses to 25 percent of loan proceeds;
— Eliminate restrictions that limits loan terms to two years;
— Ensure full access to payroll tax deferment for businesses that take PPP loans; and
— Provide a rehiring safe harbor for businesses unable to rehire employees due to the effects of enhanced Unemployment Insurance
Given that U.S. Senate Republicans are generally supportive of these changes to the PPP, it’s likely that the PPP will be revised soon.
PMAA also signed onto a letter this week along with the Chamber of Commerce and dozens of business associations requesting emergency legislative and administrative action to repeal the PPP’s 75-25 percent rule, extending the eight-week period for purposes of calculating loan forgiveness, and extending the June 30 safe harbor date for rehiring and restoration of pay.
These steps would conform the PPP with the reality of the gradual reopening now occurring across the United States and would help ensure that more small businesses remain in operation.