There could be good news out of Washington, D.C., this week for small businesses.
According to reports, Democratic Congressional leaders have reached a deal with officials from the Trump Administration on terms for another stimulus package to prop up the Small Business Administration’s aid program.
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This latest stimulus package, which could total as much $500 billion, would include roughly $310 billion for the Payroll Protection Program (PPP), plus another $50 billion to $60 billion for the SBA’s Economic Injury Disaster Loan program. Many independents shoe retailers told FN last week they are relying on both those programs to stay operational.
Last Thursday, the SBA announced that it had run out of money to fund the PPP. The U.S. government had allotted an initial $349 billion in emergency loans for small businesses battered by the coronavirus pandemic.
“The SBA is currently unable to accept new applications for the Paycheck Protection Program based on available appropriations funding,” the SBA wrote at the time. “Similarly, we are unable to enroll new PPP lenders at this time.”
The PPP, which guarantees loans to companies and nonprofits with fewer than 500 employees, was one component of the federal government’s $2.2 trillion CARES Act, passed in late March. The act included numerous components meant to protect American jobs and inject money into the economy, such as stimulus checks for citizens, expanded unemployment benefits and mortgage deferrals for individuals and landlords.
The funds to replenish the SBA programs have been slow to materialize, despite warnings from the Treasury Department, because Washington lawmakers have been in disagreement over how best to aid U.S. citizens during the COVID-19 crisis. Republicans favored continuing the loans to prop up the business community, while Democrats have pushed for more funds for hospitals and health care workers, and for states that are facing unprecedented budgetary pressures.
While Democrats were reportedly unsuccessful in securing financial aid for states, the new stimulus will likely include $75 billion for hospitals, plus another $25 billion for virus testing.
The deal is reportedly under review now by Senate Republicans and could be approved by the Senate as early as Thursday, and would then go to the House of Representatives.