WASHINGTON — The U.S. House overwhelmingly passed legislation Thursday to ease rules on small-business owners who are participating in a loan program meant to mitigate the economic complications of the COVID-19 pandemic.
The new legislation was a bipartisan effort, spearheaded by two freshmen — including U.S. Rep. Chip Roy, R-Austin. The goal is to give business owners and operates more flexibility in the rules small businesses must follow in order to have their loans forgiven. The bill now moves to the Senate, where Roy has said he expects it will pass. (Update: The U.S. Senate unanimously passed the bill on June 3, and it will head to the President Trump’s desk for signature.)
“We want to make sure that money is being targeted and focused in ways that’s best for those businesses in order to stay alive,” Roy said in an interview last week as he was shepherding the bill through the chamber. “That’s the concern, that businesses are unable to get through this and stay alive.”
The legislation made significant changes to the Paycheck Protection Program, a fund aimed at keeping afloat small businesses devastated by the coronavirus pandemic. In this program, small-business owners secured loans that will ultimately be forgiven if they play by the law’s rules. Roy’s bill loosened those rules for small business owners by:
- Allowing recipients to defer payroll taxes.
- Extending the time in which business owners can use the loans from June 30 until Dec. 31.
- Reducing the ratio of loan funding that must be allocated to payroll from 75% to 60%.
- Extending the period in which small-business owners who are not eligible for forgiveness can pay back the loans to five years.
The bill passed with some Democratic members voting on behalf of colleagues in a newly implemented — albeit controversial — vote-by-proxy process brought on by the COVID-19 pandemic.
The article was published at As House approves bill spearheaded by U.S. Rep. Chip Roy to ease restrictions on small-business loan program.