Congress has moved swiftly to pass legislation to allow small businesses more time to apply for forgivable federal Paycheck Protection Program loans, which are aimed at helping small employers weather the economic hit from the coronavirus pandemic.
The bill gained final congressional approval on July 1 when the House approved it. The Senate had passed the measure less than 24 hours earlier. It next goes to the White House for President Trump's signature.
The legislation would permit companies to apply for new PPP loans through Aug. 8. The initial deadline for applications was midnight on June 30.
PPP was created in the Coronavirus Aid, Relief and Economic Security, or CARES Act, which Trump signed on March 27. The law provided $349 billion for loans.
Demand was so strong that all of those funds were gone in just 13 days. That prompted Congress to add $310 billion in follow-up legislation.
But interest in the second round of loan dollars has diminished. As of 5 p.m. on June 27, $138.4 billion was still available, according to the Small Business Administration, which, along with the Treasury Dept., oversees the PPP.
Sen. Ben Cardin (D-Md.), a leader in pushing for the extension bill, said in a statement, "When Congress passed the CARES Act in March, we thought that small businesses would be operational by the end of June, but it is now clear that our nation's small businesses will still need support in the weeks and months to come."
Senate Democrats said bipartisan negotiations also were continuing on yet another PPP bill. This one would, among other things, allow small companies that have received a PPP loan and exhausted the proceeds to apply for a new PPP loan. Those applicants must have had a revenue loss of at least 50% because of the pandemic.
Under the CARES Act and subsequent legislation, PPP loan recipients can have the loan forgiven if they spend the proceeds on certain basic operating expenses. They also must spend at least 60% of the loan dollars on payroll alone.