A bipartisan group of senators on Thursday reached agreement on a bill that would ease restrictions on emergency small business loans that are designed to curb massive layoffs during the Covid-19 pandemic.
The government-backed loans can be forgiven if employers agree to maintain their payrolls. But businesses say the loan terms are too onerous, with much of the economy shut down for longer than lawmakers expected when they designed the so-called Paycheck Protection Program.
Legislation agreed to by Sens. Marco Rubio (R-Fla.), Ben Cardin (D-Md.), Susan Collins (R-Maine) and Jeanne Shaheen (D-N.H.) would give businesses 16 weeks instead of eight weeks to spend the money while still qualifying for forgiveness, according to a copy of the proposal obtained by POLITICO. It would also allow businesses to use loans to purchase personal protective equipment for employees and to pay for other “adaptive investments” needed to reopen safely, such as drive-thru window expansions and sneeze guards.
The Senate this afternoon began “hotlining” the bill — bypassing lengthy floor debate on the legislation — to see if any members objected to the proposal. It would need unanimous consent for expedited passage.
The proposal is different than one that the House plans to pass next week. The House legislation would give small business borrowers 24 weeks to spend the loan funds while also eliminating a requirement that they spend at least 75 percent of the money on payroll — a provision left out of the Senate compromise.
The Senate bill also includes new legal protections for banks that relied on borrower certifications and documentation when making the loans.