The Senate yesterday approved by unanimous consent the AHA-supported Paycheck Protection Program Flexibility Act of 2020 (H.R. 7010) to allow more leeway for small business loans during the COVID-19 crisis. The House passed the bill last week, and President Trump is expected to sign it.
The Paycheck Protection Program was established by the Coronavirus Aid, Relief, and Economic Security Act to provide loans to small businesses primarily to help keep their workers on the payroll. The legislation approved by the Senate yesterday extends the loan period to up to 24 weeks through Dec. 31, 2020, as well as the timeframe for repayment, if required. It also changes the parameters for potential loan forgiveness.
In addition, the legislation allows borrowers to use up to 40% of the loan on non-payroll expenses, and it provides different scenarios under which borrowers may be eligible for forgiveness, even if they are unable to retain or reinstate the same number of full-time equivalent employees. It also allows PPP loan borrowers who seek forgiveness of the loan to qualify for deferred payment of the employer’s portion of certain payroll taxes.
View the AHA Special Bulletin for highlights of the legislation.