By SEMA Washington, D.C., Staff
The U.S. House of Representatives passed a bipartisan bill to provide companies more flexibility on the use of funds from the U.S. Small Business Administration’s (SBA) Paycheck Protection Program (PPP). The U.S. Senate will likely take up the measure during the first week of June. Highlights of the “Paycheck Protection Program Flexibility Act” include:
- Extend from 8 weeks to 24 weeks the period of time for PPP expenses to be forgiven and extend the rehiring deadline to December 31.
- Increase from 25% to 40% the amount of nonpayroll expenses (such as rent, utility payments and mortgage interest) eligible for loan forgiveness.
- Extend the expiration date of the program from June 30 to December 31.
- Extend the amount of time before loans payments begin from 6 months to 1 year.
- Extend loan terms from two to five years.
The SBA is still accepting PPP application for loans. As of Friday, May 23, the SBA had processed 4.4 million loans for a total of $511 billion of $660 billion of total program funding currently available. Under the current program, the two-year SBA loans offer a 1% annual interest rate are issued through banks and local lenders. The SBA will forgive that portion of the loan used to cover payroll, rent, mortgage interest, and utilities for eight weeks if a small business retains its employees and payroll levels. Visit SBA PPP Loans for more information.
For more information, contact Stuart Gosswein at stuartg@sema.org.