A Republican lawmaker said Wednesday that negotiators agreed to adjust a key quota in a program to relieve small businesses from the COVID-19 pandemic, increasing the proportion of credit that must be used on payroll from the current 75 percent to 60 Lower percent and give borrowers more time to use loans.
Rep. Chip Roy, R-Texas, the sponsor of a bill slated for a House vote Thursday, told CQ Roll Call that he expects House and Senate leaders to reach an agreement on how small Corporations can leverage a $ 660 billion lifeline provided in two previous economic aid laws through the Small Business Administration-administered Paycheck Protection Program.
“We believe that we can move forward and do it well,” said Roy. Roy introduced the bill to Minnesota Democratic MP Dean Phillips, who issued a press release Wednesday announcing support for 45 corporate groups.
The bill would reduce an administrative requirement that 75 percent of PPP loan funds be used for payroll. Roy said lawmakers agreed to require 60 percent of that loan to be used for payroll, a compromise between the original draft that would have eliminated it and Treasury Secretary Steven Mnuchin’s position last week that it stay at 75 percent should.
The bill would give borrowers up to 24 weeks (up from the current eight) to use the funds and extend the deadline for worker reinstatement to June 30th. The bill would also allow companies to repay any undrawn amounts over five years instead of two years, which would help companies stay solvent by reducing the size of each payment.