WASHINGTON—U.S. Senator John Boozman (R-AR) supported adding flexibility to the Paycheck Protection Program (PPP) to make it more accessible for Arkansas small businesses in need of assistance during the COVID-19 pandemic.
The Senate-passed Paycheck Protection Program Flexibility Act updates the PPP, a program that provides low-interest loans to small businesses to use for payroll, mortgage interest, rent and utilities, with a portion of the loan eligible for forgiveness.
The Small Business Administration (SBA) administers the PPP. According to the SBA, it has approved more 40,591 loans worth more than $3.2 billion to Arkansas small businesses.
“The Paycheck Protection Program has been critical to helping Arkansas small businesses weather this pandemic. This legislation builds on its success and strengthens the PPP, so we can support the changing needs of small businesses as they continue to face challenges through the phases of reopening. Providing flexibility is a commonsense step to ensuring small businesses can utilize these loans to stay afloat and keep their workers employed,” Boozman said.
The Paycheck Protection Program Flexibility Act:
- Increases the covered period of a loan from eight weeks to 24 weeks and extends the rehiring deadline;
- Increases the current limitation on nonpayroll expenses for loan forgiveness from 25 percent to 40 percent;
- Extends the deadline to apply for a PPP loan to December 31, 2020;
- Extends loan terms from two to five years; and
- Ensures full access to payroll tax deferment for businesses that accept PPP loans.
The House of Representatives passed this legislation last week. It’s headed to the president’s desk to be signed into law.
At the end of May, the SBA reported approximately $140 billion remained available for PPP loans. Small business owners can find local SBA-approved lenders here.