The top House Republican taxwriter is backing efforts to expand the Paycheck Protection Program (PPP) as efforts to fast-track the measure in the Senate failed.
Ways and Means Committee ranking member Kevin Brady, R-Texas, told reporters May 21 that he supports a bill to extend the PPP's eight-week loan forgiveness period. The House is expected to vote on the Paycheck Protection Program Flexibility Act of 2020 (H.R. 6886) the week of May 25.
The bill, introduced by Reps. Chip Roy, R-Texas, and Dean Phillips, D-Minn., would allow businesses that take loans under the program to defer payroll taxes and would eliminate the 25 percent cap on non-payroll expenses for the purpose of calculating forgiveness.
Although Brady lauded the small business loan program created by the Coronavirus Aid, Relief, and Economic Security (CARES) Act (P.L. 116-136), he said problems have emerged over the last two months that need attention. “It isn’t working as a one-size-fits-all,” Brady said, adding that businesses need more than two years to pay off the non-payroll portion of the loan as dictated in the bill.
In a May 21 letter to House Speaker Nancy Pelosi, D-Calif., and House Minority Leader Kevin McCarthy, R-Calif., a group of trade associations asked Congress to swiftly approve the measure.
The letter, led by the American Hospitality and Lodging Association, said the provisions in the bill would “empower small businesses to have the autonomy to make their own decisions about how to best meet their obligations” to stay in their physical locations and keep workers employed.
Brady also said he would like to see PPP loans extended to 501(c)(6) nonprofits, which weren't included in the program.
By the time the House votes on the measure it could be altered and adopt some provisions suggested in the Senate, which sought to pass its own version by unanimous consent May 21. An attempt by Cory Gardner, R-Colo., to force a vote on extending the PPP ultimately failed to get all lawmakers on board.
The Senate’s version is the Paycheck Protection Program Extension Act, introduced by Marco Rubio, R-Fla.; Susan M. Collins, R-Maine; Jeanne Shaheen, D-N.H.; and Finance Committee member Benjamin L. Cardin, D-Md. It would extend the forgiveness period to only 16 weeks rather than 24 weeks as proposed in the House bill.
The Senate bill would also allow borrowers to use loan funds to purchase personal protective equipment for employees and extend the deadline to apply for a loan to the end of the year.
The Senate is expected to take up the legislation when members return from recess June 1.