The U.S. Senate has passed an extension of the Paycheck Protection Program (PPP) on Tuesday night just a few hours before the close of the program. The extension allows for 5 additional weeks, until August 8th 2020 to apply for the SBA funding.
Before the extension can take effect it still needs to pass the House and be signed by President Donald Trump. It is expected that the House of Representatives will pass the measure this week.
The legislation is intended to provide more time for businesses to apply for the estimated $130 billion in funding still remaining.
This move came less than a month after both Houses of Congress passed with unanimous consent the Paycheck Protection Program Flexibility Act (PPPFA) in an attempt to address many concerns expressed by the small business community around the Paycheck Protection Program (PPP) aimed at providing COVID-19 relief. The act included provisions to reduce the amount borrowers need to spend on wages and allowed for more time to use those funds.
To help keep small businesses afloat, the CARES Act provides that businesses with fewer than 500 employees, including sole proprietors and nonprofits, will have access to nearly $350 billion in loans through the Small Business Act during the “covered period,” which ran from February 15, 2020 through June 30, 2020. The loans, which are referred to as “paycheck protection loans” and are fully guaranteed by the federal government through December 31, 2020.