WASHINGTON–Today is the last day for companies to apply for loans as part of the Paycheck Protection Program. According to the SBA, although the second round of available funds was expected to be depleted as quickly as the first, there is approximately $100 billion still available.
Separately, the GAO has released a report offering suggestions to improve the PPP, but the SBA says most of the recommendations are already in place.
What to do with the remaining funds is now the source of new debate, with recommendations including returning the funds to Treasury and saving the money, to making a second round of funds available for certain types of business, to expanding outreach to ensure funds have gone to minority-owned businesses.
Others are calling for the funds to be reserved should the ongoing wave of coronavirus infections continue to grow.
Trade Group Offers Ideas
In all, Congress allocated $659 billion in funds for the PPP. The initial round, approved as part of the CARES Act, set aside $349 billion in the loans, which are to be forgiven if certain criteria are met. That $349 billion was quickly exhausted, and Congress approved an additional $310 billion in subsequent funds.
NAFCU noted it has been advocating to extend the June 30th deadline for small business to receive a loan. Additionally, NAFCU has asked for:
- Additional PPP funds specifically for underserved communities
- Automatic loan forgiveness for borrowers with under $150K in loans
- Allowing small businesses to take out a second PPP if they need, among other items
Where to Get More Information
As CUToday.info earlier reported here, the Trump Administration has reversed itself and now says it will release the names of borrowers who received Paycheck Protection Program loans of $150,000 or more. Those borrowers account for about 75% of funds lent through the program, according to the Treasury Department.
American Action Forum has created a tracker of where the funds have gone, average size of loans, etc., here.
GAO Offers SBA Ways to Improve PPP
Separately, the GAO has released a report opportunities it sees to improve government response and relief efforts to the coronavirus pandemic, including the SBA’s Paycheck Protection Program (PPP), but the SBA said it already has many of the recommendations in place.
In the report, which is required by the CARES Act to be delivered to Congress, the GAO recommends the SBA develop and implement plans to identify and respond to risks in the PPP to “ensure program integrity, achieve program effectiveness, and address potential fraud.”
But in its response, which is included in the report, the SBA said the GAO did not account for the safeguards the agency has put into place in the interim final rules issued on loan review and forgiveness.
The GAO also recommends Congress provide the Treasury Department with access to the Social Security Administration’s full set of death records and further require Treasury to consistently use it as a tool to help reduce improper payments, specifically for economic impact stimulus payments.
The SBA and Treasury have also updated their FAQs to support changes made by the Paycheck Protection Program Flexibility Act (H.R. 7010) to the loan maturity date.