While Senator Collins Fails to Acknowledge Problems Cited by Maine Small Business Owners, House Democrats Pass Bill that Fixes the Flawed PPP
83% of Maine Small Businesses Have Not Received Assistance from PPP
The US House of Representatives has voted to pass the HEROES Act, which includes much-needed changes to the Paycheck Protection Program (PPP). As Mainers applaud House Democrats for their leadership in passing the bill, they look to Senator Susan Collins to take similar action to fix her flawed program that has left the majority of Maine small businesses behind, while providing large corporations access to millions in taxpayer-funded grants.
Changes to the PPP made in the HEROES Act include targeting the smallest businesses by reserving 25% of remaining PPP funds for businesses with 10 or fewer employees and increasing transparency and accountability by requiring the Small Business Administration (SBA) to report daily and weekly on PPP loans.
Willy Ritch, executive director of 16 Counties Coalition issued the following statement in response:
“Instead of padding the pockets of her special interest donors, Senator Collins needs to listen to the majority of Maine small business owners who have been shut out of the PPP. We need Senator Collins to step up and follow the House’s lead, and support changes in this new legislation that provide more oversight of the poorly-written program.”
Approximately 83 percent of Maine small businesses have not received assistance from the PPP. And Maine small business owners who have been able to secure loans are now concerned about poor guidance and restrictions on loan forgiveness included in the fine print of the PPP. Many worry these issues could force them to lay off workers or jeopardize their access to unemployment, and will saddle their already struggling businesses with additional debt and expenses.
Changes to the PPP passed in the HEROES Act:
- Targets the smallest businesses by reserving 25% of remaining PPP funds for businesses with 10 or fewer employees.
- Increases transparency and accountability by requiring SBA to report daily and weekly on PPP loans to provide transparency on who is getting loans, including by ethnicity and gender.
- Extends the covered period for payroll costs for forgiveness eligibility to 24 weeks (from 8 weeks), and the covered period through December 31, 2020 (from June 30);
- Eliminates the 75/25 requirement imposed by Treasury/SBA that limits the amount of non-payroll costs to be included in forgiveness amounts;
- Ensures small businesses are still eligible for loan forgiveness if they can certify that they are unable to rehire workers in the prescribed time frame;
- Allows non-profits of any size to be eligible for PPP loans (not subject to 500 employee limit);
- Makes 501(c)(6) organizations (like chambers of commerce) eligible for PPP;
- Clarifies that loan terms extend through the end of the covered period;
- Establishes a minimum maturity on PPP loans of 5 years to enable borrowers to amortize loans over a longer period of time, which lowers monthly payments; and
- Clarifies coordination between the Employee Retention Tax Credit and the PPP loans to ensure borrowers can take advantage of both types of assistance.
