April 21, 2020: Senate Approves $484 Billion Amendment to the CARES Act, Increasing Funding, Including $370 Billion More for Business Loans
On April 21, the Senate approved another stimulus bill, which, if passed into law, will provide an additional $484 billion in economic aid to combat the novel coronavirus and related economic distress. It would replenish funds for business loans under the Paycheck Protection Program (“PPP”) and the emergency Economic Injury Disaster Loan Program (“EIDL”). The House is expected to pass the bill on Thursday, April 23, and the President has indicated that he will sign it into law.
Of the new funding, $310 billion will replenish the exhausted PPP. In response to concerns that larger banks and larger businesses crowded out smaller enterprises in the first round of PPP lending, $60 billion of the new PPP funding will be reserved for small lenders, including community banks, credit unions, and other smaller and community financial institutions that have less than $10 billion in assets.
The new bill will also inject $10 billion more into the EIDL grants and $50 billion more into EIDL loans. It specifically opens eligibility for EIDL to agricultural enterprises and increases funding for expanded COVID-19 testing, hospitals and healthcare providers, salaries and expenses of the Small Business Administration.
Even the increased funding that is expected to pass into law is unlikely to satisfy all the demand for loans to eligible businesses. Businesses that are interested in PPP or EIDL loans are encouraged to act without delay after the bill approving new funding is signed into law. The backlog of PPP and EIDL loan applications will be processed before any new applications are accepted. Assuming funds remain, new PPP loan applications will then be accepted through eligible financial institutions (see the list of lenders here) and new EIDL applications will likely be available at https://covid19relief.sba.gov/#/.
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FOR MORE INFORMATION
For more information about the Paycheck Protection Program or SBA emergency economic injury disaster loans, please contact your attorney at Gravel & Shea PC or any of the following attorneys at the firm:
Chip Mason (firstname.lastname@example.org), Cassandra LaRae-Perez(email@example.com), Oliver Goodenough (firstname.lastname@example.org), Keith Roberts (email@example.com), Pauline Law (firstname.lastname@example.org), or Catherine Burke (email@example.com).