Congress delivers reforms to the Paycheck Protection Program

Common Ground profiles members of opposing parties who are working together to advance issues important to hoteliers.
by Sean Grossnickle
THE ISSUE
The Paycheck Protection Program (PPP), which was created under the Coronavirus Aid, Relief, and Economic Security Act, has provided billions of dollars in forgivable loans to small businesses impacted by the COVID-19 pandemic. Since launching in early April, the PPP has lent over $500 billion to more than 4.5 million American businesses. However, the original terms and conditions of the PPP loans were inflexible and did not accommodate the difficult and lengthy recovery process many businesses face.
For small businesses that received PPP loans at the start of the program, the rigid eight-week forgiveness deadline threatened the future of their business even as states across the country started to reopen. Businesses in the hospitality industry, which were just beginning to resume operations, lacked sufficient time to distribute pay and comply with other restrictive stipulations under the original PPP guidelines.
COMMON GROUND
On May 26, Representatives Dean Phillips (D-MN) and Chip Roy (R-TX) introduced H.R. 7010, the Paycheck Protection Program Flexibility Act of 2020, to modify the PPP and provide borrowers much-needed flexibility to achieve maximum forgiveness of their PPP loans. This bill passed the House with a vote of 417-1, and then it cleared the Senate by unanimous consent. On June 5, President Trump signed this bipartisan bill into law. The PPP Flexibility Act grants borrowers more time to spend the funds received from the program and broadens the expense categories that qualify for loan forgiveness. ?
Rep. Dean Phillips (D-MN), Co-author of H.R. 7010
First Elected: 2018
“We must redesign the Paycheck Protection Program (PPP) to make it accessible to everyone, from food trucks to four-star restaurants to your favorite music venue. While the PPP has helped millions of small businesses keep their lights on, millions more remain on the outside looking in. It won’t matter how much money we appropriate if the system by which it’s distributed is inaccessible to those who need it the most. As an entrepreneur and small business owner myself, I understand the challenges facing businesses struggling to survive this crisis. These common-sense solutions will provide the flexibility necessary to weather the storm and prepare for uncertain times ahead. I am pleased to work with Congressman Roy on a bipartisan solution supporting small businesses – the backbone of the U.S. economy.”
Rep. Chip Roy (R-TX), Co-author of H.R. 7010
First Elected: 2018
“The Paycheck Protection Program (PPP) is providing essential capital to millions of small businesses across the country. Unfortunately, for many of these business owners, particularly local restaurants, hotels, and those in the hospitality industry, the terms are too inflexible to provide the help they need to weather the economic storm. PPP cannot protect jobs if workers have no job to return to after state and local lockdowns are lifted. …Many businesses are already four weeks into the loan and need this flexibility immediately before the forgiveness timeline runs out. I look forward to continue working with my colleagues on both sides of the aisle to enact these simple but critical reforms in order to save small businesses.”