On March 27, 2020, the Coronavirus, Aid, Relief, and Economic Security Act (CARES) was enacted into law, providing emergency assistance for small businesses and eligible nonprofits affected by the Coronavirus pandemic (COVID-19).
The CARES Act established the Paycheck Protection Program (PPP), a new guaranteed loan program at the Small Business Administration (SBA) to help small businesses cover payroll and other expenses during the crisis, with 100 percent of the amount eligible for forgiveness if employers retain employees.
The CARES Act also created a new $10 billion grant program, leveraging SBA’s Office of Disaster Assistance to provide small businesses with much-needed capital in a timely manner. Congress intended that these programs would provide immediate financial support to secure the survival of the small business community.
While recognizing the implementation of these new programs is a tall order for any agency, critical problems have emerged with the rollout of the Paycheck Protection Program that threaten the survival of small businesses across the country.
That is why House Democrats proposed critical changes to the program to strengthen the PPP and EIDL programs, ensuring small businesses in desperate need of funding can stay afloat. The Paycheck Protection Program and Health Care Enhancement Act shore up funding for the depleted loan and grant programs, injecting much-needed capital into our small businesses.
In addition to making sure small farmers can access the EIDL loan and grant programs, House Democrats fought for and won a set aside for community based lenders to reach our underserved communities.
Top Line Summary
Strengthen the Paycheck Protection Program
The Paycheck Protection Program and Health Care Enhancement Act strengthens the PPP by prioritizing America’s smallest businesses, including minority, women, veteran, and rural businesses by:
Expand Economic Injury Disaster Program
The Paycheck Protection Program and Health Care Enhancement Act expands the economic injury disaster loan program to increase assistance to small businesses by:
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