The U.S. House of Representatives is expected to approve legislation today authorizing $484 billion in relief funds to mitigate the economic impact of the coronavirus pandemic. If it passes today's roll-call vote, it will go to the president for his signature. The Paycheck Protection Program and Health Care Enhancement Act, which passed the Senate on Tuesday, replenishes funding for two Small Business Administration loan programs after initial funds were quickly depleted. PPAI iheld a webinar this afternoon offering a deeper dive on the bill and what it entails.

The new legislation amends the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was signed into law on March 27. The signature features of this bill are that it amends the Paycheck Protection Program (PPP), the Economic Injury Disaster Loans and emergency grants, all of which are being administered by the Small Business Administration (SBA).

The Paycheck Protection Program and Health Care Enhancement Act appropriates an additional $321 billion in funding for the Paycheck Protection Program. This federal initiative, which falls under the SBA’s section 7(a) loan program, offers low‐interest loans to help small businesses, certain nonprofit organizations and individuals impacted by the coronavirus pandemic. The loan availability is retroactive to February 15 and remains effective until June 30. These loans would be available during the covered period for any business with 500 or fewer employees, including independent contractors and sole proprietors.

Qualified borrowers may receive PPP loans up to $10 million, and the loan amount may qualify to be forgiven if the funds are used for approved purposes, including payroll costs, rent and utilities. Part of the appropriation for the additional Paycheck Protection Program funding includes $60 billion for smaller financial institutions. This provision sets aside $30 billion in PPP loans for banks and credit unions that have between $10 billion and $50 billion in assets, and $30 billion in PPP loans for community banks and credit unions with less than $10 billion in assets. This is the Senate’s attempt to ensure that some of the PPP loan funding is directed to small businesses. The CARES Act also expanded the eligibility criteria for SBA section 7(a) loans with respect to this program. This expansion was not affected by the Enhancement Act. Those who may be interested in the PPP loans, including independent contractors and sole proprietors, should contact their bank.

The Paycheck Protection Program and Health Care Enhancement Act adds $50 billion to the congressional authorization for the Economic Injury Disaster Loan (EIDL) program, and an additional $10 billion for EIDL emergency grants. The emergency grants can be used to cover businesses’ operating costs. The CARES Act authorized the SBA to expedite the grants so businesses may receive a portion of the EIDL funding within three days of applying. These loans are forgivable if a borrower provides sufficient documentation to the lender to substantiate qualified uses of the funds for forgiveness purposes. The covered period for these loans is retroactive, from February 15 until June 30. Small businesses and nonprofits with 500 or fewer employees are eligible to apply for this program. The CARES Act also expanded the eligibility criteria for this loan program, and the Enhancement Act does not affect the expansion. Under the Enhancement Act, sole proprietors and independent contractors should remain eligible for this funding. Anyone who is interested in an Economic Injury Disaster Loan may apply through the SBA application process here.

The Paycheck Protection Program and Health Care Enhancement Act makes several amendments to the CARES Act, which was passed to help businesses mitigate their coronavirus‐related losses. Like the CARES Act, the new legislation, if enacted, will authorize federal funding for states, companies, Individuals and other entities adversely affected by the coronavirus pandemic.

PPAI iheld a webinar, “Paycheck Protection Program and Healthcare Enhancement Act” today to further explain the legislation. A recording of the session will be available, with up-to-date information and answers to industry members' questions.

Find more reports on the industry’s COVID-19 response, provisions of the CARES Act, links to related webinars and further information on PPAI’s coronavirus information page here.