The House voted to extend PPP for two months. Here’s what happens next

Customer Tamara Jenkins tries on a hat with Meeka Robinson Davis, owner of One-Of-A-Kind Hats, as Davis’ daughter Chrstiana Davis looks on, at the store in the Windsor Hills neighborhood of Los Angeles, California, November 24, 2020.

Patrick T. Fallon | AFP | Getty Images

Small businesses got some good news on Tuesday, when the House of Representatives voted to extend the Paycheck Protection Program for two months.

The bill, the PPP Extension Act of 2021, passed the House on a 415-3 vote. It would extend the program to May 31, instead of the current date of March 31, and give the Small Business Administration an additional 30 days to process loans.

Next, the bill goes to the Senate, where it is expected to be approved. Majority Leader Charles Schumer, D-N.Y., said that Democrats want to pass the measure as quickly as possible.

Last week, a companion to the House bill was introduced in the Senate by a bipartisan group including U.S. Senate Committee on Small Business & Entrepreneurship Chair Ben Cardin, D-Md.; Sen. Susan Collins, R-Maine; and Sen. Jeanne Shaheen, D-N.H.

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“It’s clear that the most vulnerable small businesses will need help beyond March 31, so we must pass this extension as quickly as possible,” said Sen. Cardin in a Thursday statement. “This common sense, bipartisan bill will meet the continued demand for PPP loans by giving small businesses two more months to apply and giving SBA an additional month to process the loan applications by June 30.”

Calls to move the PPP deadline have grown since the Biden administration in February announced changes to the program, including a 14-day priority application period for businesses with fewer than 20 employees, an updated loan calculation formula for sole proprietors and new eligibility rules.

The goal of the exclusive application window and new rules was to get more forgivable funding to the smallest businesses, which are majority women- and minority-owned.

Still, the timing of the changes brought confusion and frustration for many, especially sole proprietors who missed out on bigger loans by a few days. The SBA wasn’t ready to accept new applications from these businesses until March 5, giving them only a few weeks to take advantage of the change ahead of the March 31 deadline.

Source: CNBC