Lawmakers outline plan to extend PPP deadline to May 31

UPDATE: March 17, 2021: The Chamber, by 415 votes to 3, passed a bill on Tuesday extension of time to May 31 for borrowers to apply for a Paycheck Protection Program (PPP) loan. The bill, which also gives the Small Business Administration (SBA) until June 30 to process requests, now go to the Senate.

This room Tuesday confirmed Isabel Guzman as administrator of the SBA, by 81 votes to 17. Guzman, under the Obama administration, was previously deputy chief of staff of the agency.

Dive brief:

  • House and Senate lawmakers have come together in a bipartisan effort to extend the deadline for the paycheck protection program by two months until May 31.

  • The proposal to expand the Small Business Assistance Program, which ends March 31, was presented on Thursday by Chamber of Small Business President Nydia Velázquez, D-NY, and Representative Blaine Luetkemeyer, R- MO. The President of the Senate for Small Business, Ben Cardin, D-MD, and the other members of the Sens committee. Susan Collins, R-ME, and Jeanne Shaheen, D-NH, accompanying law unveiled Thursday reflecting the House bill.

  • The House is expected to vote on the bill next week before members leave Washington, DC, through mid-April, according to Politico.

Dive overview:

“The demand for PPP loans right now is a testament to the effectiveness of the program and the lingering impacts of this pandemic. That is why we cannot suspend aid now and this short term extension is so important,” said Velázquez in a statement. “The bill will go a long way in helping small businesses support their employees and keep our economic recovery going. “

Under the PPP Extension Act, small businesses will have an additional two months to submit a PPP loan application, and the Small Business Administration (SBA) will have until June 30 to close pending applications.

Banking business groups lobbied for an extension of the program, which the Biden administration revised February 22 allow individual owners, independent contractors and the self-employed to use gross income rather than net profit to calculate how much P3 funding they should receive.

The SBA updated its systems to implement this change on March 5 The New York Times reported, which means the changes the White House outlined last month and codified March 3 were only taken into account for requests processed during the past week.

Calls to expand the PPP come as several of the country’s largest lenders have announced they are close their application acceptance window earlier meet the deadline of March 31.

Bank of America said in a declaration on its website that it stopped taking new applications Tuesday for first and second draw PPP loans from customers.

JPMorgan Chase set a deadline of March 19 for borrowers to apply for PPP loans, and Citi has stated that it will not accept PPP loan applications after March 20.

Efforts to extend the program deadline were expected, given the Biden administration’s implementation of a two-week break from February 24 to March 9, where only companies with fewer than 20 employees were allowed to submit. nominations.

This pause could reduce the number of loans issued under the program – and funding levels – by shortening the time period during which the rest of the eligible market must apply by the March 31 deadline, Michael Brauneis, Managing Director and U.S. leader in the financial services industry at global consulting firm Protiviti, says Banking Dive last month.

Since the start of the program, the ASB approved 7.6 million PPP loans totaling $ 687.3 billion on Sunday.

The $ 1.9 trillion stimulus package President Biden on Thursday signed includes $ 7.25 billion in additional PPP funding.

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