From the moment the Paycheck Protection Program began operating in early April, critics have charged that it could end up hurting the small businesses it is supposed to help.
Most notably, the requirement that small business owners spend all of the money they receive within eight weeks while dedicating at least 75% of the funds to labor costs in order for the loans to become grants has made participation in the program difficult if not impossible for some potential aid recipients. Many small businesses with sizable overhead costs but low labor costs, such as independently owned restaurants, are worried that they won’t be able to satisfy those conditions, leaving them with loans that have to be paid back, despite being closed for months.
In response to those complaints, lawmakers in the House are working an overhaul of the PPP, which has received about $670 billion in funding from Congress so far. The legislation will reportedly give small businesses up to 24 weeks to spend the money and eliminate the requirement that most of the funds be used for labor costs.
The bill appears to have bipartisan backing and could be voted on next week. The Small Business Administration said Saturday that more than 4 million loans worth $513 billion have been approved since April 3, leaving more than $100 billion available for additional lending.