Courtney Helps Pass Bipartisan Bill to Improve the Paycheck Protection Program for Small Businesses

WASHINGTON, DC – Today, Congressman Joe Courtney (CT-02) voted to help pass the bipartisan Paycheck Protection Program Flexibility Act (H.R. 7010), a new bill that will improve the federal Paycheck Protection Program (PPP) for small business by providing broader access to the program, and more flexibility in how employers can utilize funding. H.R. 7010 passed the House of Representatives in overwhelming bipartisan fashion by a vote of 417-1.

"Small businesses employ nearly half of our nation's entire workforce, and it's clear that more needs to done to help them so that they can continue to keep the lights on in our economy," said Congressman Courtney. "I've spoken to countless small business owners and to Chambers of Commerce across our region who are dealing with this economic crisis firsthand, and the current limitations of Paycheck Protection Program are simply making it too restrictive to get them the sort of help they need. The bipartisan CARES Act was negotiated to get help out the door fast, and now that PPP loans have been law for several months it's clear where we need to improve. Small businesses aren't a one-size-fits-all formula, and from our independent restaurants, to retailers, to local manufacturers, employers need more flexibility so that PPP loans can be the widely applicable funding source they were intended to be—not an unwieldly and potentially costly loan for small employers. The PPP Flexibility Act will help make the program more relevant to small employers in eastern Connecticut, and the House came together today to pass the bill by a vote of 417-1. The Senate should follow our lead, and pass this bipartisan legislation."

The Paycheck Protection Program was created by Congress through the bipartisan CARES Act. Under current program rules promulgated by the SBA, the PPP loan eventually turns into a grant as long as the small business uses the loan in line with SBA requirements, including (among other requirements) – utilizing the funds by June 30 and spending at least 75% of the loan proceeds on payroll, with no more than 25% going towards rent, mortgage interest, and utilities. Rep. Courtney has remained in constant contact with eastern Connecticut small businesses, employers, and Chambers of Commerce, who have reported that, with these restrictions, the loans do not meet their needs. Many small businesses have not applied for PPP assistance because they do not believe they can meet the requirements to make the loan forgivable, and other employers who have received PPP funding report that they are reluctant to use the money because of the inflexible, one-size-fits-all rules.

The bipartisan Paycheck Protection Program Flexibility Act will increase flexibility and access to PPP loans by:

• Allowing forgiveness for expenses beyond the 8-week covered period to 24 weeks and extending the rehiring deadline;
• Increasing the current limitation on nonpayroll expenses (such as rent, utility payments and mortgage interest) for loan forgiveness from 25 to 40 percent;
• Extending the program from June 30 to December 31;
• Ensuring full access to payroll tax deferment for businesses that take PPP loans

H.R. 7010 now awaits further consideration in the Senate.

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