by SEAN GROSSNICKLE
The Paycheck Protection Program (PPP) was established more than a year ago in the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The PPP has been a centerpiece of pandemic relief targeted directly to assist small businesses severely impacted by the ongoing pandemic. Since its inception, the PPP has provided nearly $700 billion of government-backed small business loans that can be forgiven if used to cover payroll costs and other approved expenses. In 2021 alone, 2.1 million PPP loans were approved, totaling $156.2 billion as of March 7.
The PPP has been a hallmark of bipartisan cooperation in Congress. After its initial success, the PPP has received numerous rounds of funding, regulatory reforms, and deadline extensions. While the program has garnered criticism for its inequity and terms of forgiveness, it nonetheless remains a staple in the federal government’s ongoing effort to support small businesses. The PPP received its latest round of funding from the American Rescue Plan signed into law on March 11, 2021, adding $7.25 billion to the program. However, the PPP was once again approaching expiration on March 31, 2021. As that deadline neared, banks began winding down their PPP operations, which was further complicated by the periods of loan forgiveness, leaving many applicants waiting for the second round of funding before the program was set to expire.
In early March 2021, Members of the House Committee on Small Business hosted a hearing to discuss the recent round of funding allocated to the PPP and its upcoming deadline. Members of the committee proposed H.R. 1799, the Paycheck Protection Program Extension Act, which would extend the PPP deadline to May 31, 2021. At the time this article was penned, companion legislation in the Senate had yet to be proposed. Given its history of bipartisan support, we expect this legislation to pass prior to the March deadline.
Rep. Carolyn Boudreaux (D-GA-7), Sponsor of the Paycheck Protection Program Extension Act
“During the past year, small businesses in Gwinnett and Forsyth have been devastated by the impact of COVID-19. While PPP assistance has been a crucial lifeline for many businesses in my district, I hear every day from mom-and-pop shops that have been unable to access the financial resources offered by the program. Many of those businesses are minority- or women-owned. Passing the bipartisan Paycheck Protection Program Extension Act will allow more of these businesses the opportunity to access much-needed funds.”
Rep. Blaine Luetkemeyer (R-MO-3), Co-sponsor of the Paycheck Protection Program Extension Act
“As America begins to open up for business and vaccines become more widely distributed across the country, we must provide targeted relief for small businesses that need it most. This bipartisan legislation will provide a commonsense extension to the Paycheck Protection Program and the tools for Main Street USA to contribute to their local economies once again.”