On April 23, Congress voted in another piece of legislation authorizing $484 billion of coranavirus relief and on the morning of the 24th, the President signed the Paycheck Protection Program and Healthcare Enhancement Act. The Act expands on some programs that were initiated by the CARES Act, including further funding for small business loans under the Paycheck Protection Program, and authorizes new emergency funding for hospitals and research and testing to combat coronavirus. This brings total federal funding of coronavirus stimulus and relief efforts up to $2.8 trillion in seven weeks.
The centerpiece of the new legislation is an extension of the Paycheck Protection Program (PPP) loans for small businesses guaranteed by the SBA and administered by banks and other qualified lenders. The Act strikes out the original $349 billion, which was consumed in a matter of 13 days, and now authorizes $659 billion in PPP loans. Some experts expect this $310 billion allotment to be depleted even faster than the original loans were. Many banks have been preparing to submit loan applications on this "round" of funding for several days.
With an eye on underserved communities and borrowers, the Act sets aside $30 billion in SBA guaranteed PPP loans for lenders and credit unions with assets between $10 billion and $50 billion in assets. An additional $30 billion is set aside for community financial institutions, small insured depository institutions, and credit unions with assets of less than $10 billion.
The Act also authorizes an additional $10 billion for Emergency Economic Injury Disaster Loans (EIDL) and grants. These resources are available to small businesses impacted by the pandemic and are administered directly by the SBA. The Act also makes agricultural enterprises with under 500 employees eligible for the EIDL loans and emergency grants.
If you're a small business owner and have questions about how this new law affects you, give us a call at 253.858.5434. We're here to help.