WASHINGTON (CN) — The House of Representatives approved changes Thursday that give the federal small business lending program greater flexibility to help pandemic-rattled businesses.
Small businesses that receive loans under the Paycheck Protection Program would be entitled through the changes to spend the money over a longer period of time, and on a wider range of expenses, while still taking advantage of the loan forgiveness that is at the heart of the program.
The measure passed the House on an overwhelming 417-1 vote, with Kentucky Representative Thomas Massie the lone lawmaker to vote against the package. The bill now heads to the Senate, and President Donald Trump is expected to sign it after it clears the Republican-controlled chamber.
The Paycheck Protection Program was a key piece of the $2.2 trillion Cares Act that passed Congress at the end of March. Under the initiative, small businesses can take out loans that can be forgiven if the companies use the money to cover payroll, rent and certain other expenses.
While the original legislation included eight weeks to spend the money, the changes the House passed Thursday ups that timeframe to 24 weeks. The bill also prevents the Small Businesses Administration from limiting how much of a loan that is spent on expenses other than payroll can be forgiven.
The original legislation gave businesses until June 30 to rehire employees and still be eligible for loan forgiveness, but the changes passed Thursday would extend that deadline to the end of the year.
Representative Dean Phillips, a Democrat from Minnesota who sponsored the legislation, touted the flexibility that the new changes encompass.
He said they are critical for restaurants and other companies that face strict constraints on how they can operate due to state-mandated closures and regulations.
“This bill will help people in the ways that they need and we have not a moment to lose,” Phillips said on the House floor Thursday.
Representative Chip Roy, a Texas Republican who co-sponsored the tweaks, said the Paycheck Protection Program has been successful but that the changing circumstances of the pandemic require additional action to help struggling businesses stay afloat.
“They’re a part of the culture of our lives, the fabric of what we do every day when we visit with our families and communities,” Roy said. “We need to save these great institutions.”
Kevin Kuhlman, the vice president of government relations for the National Federation of Independent Businesses, said Thursday the legislation will help companies keep to the terms of the Payroll Protection Program while they navigate the reopening process.
“Small business owners are working hard to safely and swiftly reopen and rehire,” Kuhlman said in a statement. “They are doing all that they can to support their employees and ensure that they are in full compliance with the provisions of the Paycheck Protection Program loan terms.”