As the country continues to grapple with the health and financial effects of the coronavirus, the summer season is upon us, and with it comes an effort by Congress to put together one more large coronavirus relief bill.
PIA National spent much of the spring encouraging Congress to provide immediate financial assistance to small businesses dealing with the financial effects of the government-ordered shutdowns due to the coronavirus. PIA National supported the creation of and improvements to the Paycheck Protection Program (PPP), which was created by the CARES Act. The PPP provides qualified businesses with low-interest loans, which, under certain circumstances, can be partially or fully forgiven. PPP funds are intended to keep employees on the payroll and save small businesses hurt by mandated shutdowns prompted by the coronavirus pandemic.
We have sought improvements to the PPP to provide participating businessowners with more flexibility. As a result, a PPP improvement law allows recipients to spend a smaller percentage of the money (60 percent instead of the original 75 percent) on payroll and still maintain forgiveness eligibility. In addition, businesses now have more time to use the funds—24 weeks instead of eight—and more time to rehire workers, from June 30 to the end of this year. The payroll provision did not help as much as PIA National and a coalition of business groups had hoped. If Congress provides additional time for eligible businesses to apply for the remaining PPP funds in the next coronavirus package (currently, the PPP is set to stop accepting applications on June 30), we will continue to encourage maximum program flexibility, so that recipient businesses can use the funds as they deem appropriate to maintain solvency.
PIA National also seeks the creation of a Recovery Fund that would provide businesses with liquidity and fewer restrictions on the use of the funds. Another, similar option would involve the reallocation of leftover PPP funds into a different, less restrictive vehicle for small-business loans or grants. Whether via the Recovery Fund, a revitalized and reformed PPP, or a combination, PIA National will urge Congress to provide more relief for small businesses in the coming coronavirus package.