As of Wednesday night, SBA reported that 4.5 million businesses had received approvals for loans totaling $510.6 billion. About $130 billion remains from the second round of $320 billion that Congress approved for PPP. The initial round of $349 billion was tapped in just 13 days.
In the auto industry, the program has brought important aid to dealerships and smaller parts manufacturers.
Small business advocates hailed passage of the bill as providing needed flexibility to firms still struggling to emerge from COVID-related closings, even as lenders and other groups are still seeking other program changes they hope Congress can make in the coming weeks.
Sean Kennedy, executive vice president of the National Restaurant Association representing thousands of owners and chains including McDonald’s Corp., said in a statement the passage is “a win for restaurants and small businesses across the country.”
The U.S. Chamber of Commerce said a new survey it released Wednesday with MetLife showed that while 8 of 10 small businesses are in the process of reopening, 55 percent think it will take more than six months to be fully operational – up from 50 percent in an April poll and 46 percent in March.
“Congress deserves credit for removing barriers that could slow recovery further,” the chamber said in a statement. “We urge the president to sign the legislation quickly and for SBA and Treasury to immediately provide guidance to small businesses on how they qualify for loan forgiveness under the new law.”
A National Federation of Independent Business survey of its members last week showed that a majority have their loan-forgiveness period ending in the next couple of weeks. The group said in a statement it is pleased the Senate passed “much-needed flexibility for small business owners” and “we look forward to continuing to work with members in the chamber on improving” the program.
Lenders are seeking to simplify the process of applying to have loans forgiven by allowing borrowers with loans of a certain amount to simply certify they followed the rules, rather than having to make complicated calculations with rules that keep changing.
“Much more needs to be done on this bill,” said Paul Merski of the Independent Community Bankers of America. “This is largely a Senate punt on fixing the issues with the PPP program.”
There was broad support during a Senate Small Business Committee hearing Wednesday for extending the eight-week loan forgiveness period and changing the rule that 75 percent of proceeds must be spent on payroll.
Republican Sen. Joni Ernst of Iowa highlighted a sportswear business in her state that kept 27 workers employed with a PPP loan despite a 96 percent decline in revenue. But with ballparks and other venues where the apparel is sold still closed — and the firm’s eight-week period expiring this week – the workers will be furloughed, she said.
Michael Strain, director of economic policy studies at the American Enterprise Institute, called the 75 percent payroll rule — set by SBA and Treasury — “a mistake” because it limits the program’s ability to help companies such as those in high-rent cities that need to spend more money on expenses.
“A business that cannot pay its rent also cannot continue paying its workers,” Strain told the committee.
