Feds expected to tweak Paycheck Protection Program amid criticism
By Sun, May 17, 2020
WASHINGTON — Lawmakers and government officials are preparing to make significant changes to the Paycheck Protection Program, amid cooling demand for government-backed loans and criticism from business owners who say they can’t tap the funds.
The changes are likely to include giving businesses more flexibility to spend the money, according to lawmakers and others following the deliberations. Under the original terms, 75% of the funds were required to be spent on employee salaries for the loans to be forgiven.
The government also is expected to extend the time to spend the loan money beyond the two months it originally set. Both changes follow complaints from restaurants, hair salons and others who say they can’t hire back staff while they are closed during the coronavirus pandemic and need more money to cover their overhead costs.
“When we conceived the program, we thought businesses would be able to get up and running after eight weeks, but we know now that’s not the case,” Sen. Ben Cardin of Maryland, the top Democrat on the small business panel, said in a statement.
The steps being considered will mean a shift in the program’s focus—from one that was primarily aimed at keeping employees on the payroll, to also helping to keep small businesses from failing.
An expanded version of this report appears on WSJ.com:
Also popular on WSJ.com:
About the Author
Trade Stocks was specifically created as a resource that traders and investors can rely on for accurate and timely financial news and insights. Our team of industry experts brings you the into you need when you need it. That’s why hundreds of thousands of traders and investors trust us to provide them with the financial education, support, and resources that they can count on to help them move closer to their financial goals.
