In the past month, 26 million Americans — or about 16 percent of all workers — lost their jobs due to the pandemic and government-ordered business closures.
President Trump just signed a $484 billion bill – the fourth large coronavirus deal. This revives the Small Business Administration’s Paycheck Protection Program, which ran out of funds in it’s first go-around. Last time around, the initial $350 billion allocation for the PPP program (as part of a more than $2 trillion stimulus bill) ran out in two weeks.
Created under the roughly $2.2 trillion stimulus bill Congress passed last month, the PPP program is aimed at helping small companies cover payroll and other essential expenses for roughly two months. Loans can be forgiven if businesses maintain payroll – certain guidelines must be met.
The new package passed the House 388-5 on Thursday after passing the Senate unanimously on Tuesday, and was signed into law by the President on Friday, April 24th. The bill replenishes money for small-business loans to prevent layoffs.
The PPP program receives an additional $310 billion in the new bill. To address concerns that the loans were initially snatched up by businesses with well-established ties to their banks, $60 billion of the new funds will be set aside for medium, small and community lenders – including smaller banks and credit unions.
This new bill also has $75 billion for hospitals and $25 billion for COVID-19 testing.
Another $50 billion goes to the SBA’s Economic Injury Disaster Loan program and $10 billion to the SBA’s Emergency Economic Injury Grant program. Based on recent guidance, this ‘forgivable loan advance’ will not have to be repaid to the SBA. More information is available on the SBA website.
Please note that this information is subject to change at any time, so please check the SBA website at regular intervals.
Companies have scrambled for federal assistance during the global economic downturn, and the SBA is processing applications as fast as they can.
The SBA website states “Applicants who have already submitted their applications will continue to be processed on a first-come, first-served basis.”
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