WASHINGTON—Congress Thursday night passed a $484 billion funding bill to replenish two small business lending programs and provide more funding for hospitals and for COVID-19 testing.
Last week, the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan Programs (EIDL), both created under the CARES Act, reached their maximum loan amounts, leaving tens of thousands of small businesses without the help the programs were designed to provide. To add insult to injury for many small business, a number of large publicly traded restaurant and hotel brands reportedly obtained millions in funding from the PPP. Many of those companies have since returned the money, but Congress remained under significant pressure to provide more funds for these loan programs.
Early last week, Senate democrats rejected an attempt by Senate Majority Leader McConnell (R-KY) to simply add $250 billion to the program. More than a week of negotiations resulted in the bill passed by the Senate on Tuesday and the House last night.
The bill provides $310 billion for the PPP, with the $30 billion relegated to be distributed by banks with less than $10 billion in total assets and another $30 billion for banks with between $10 billion and $50 billion in assets. Those provisions are an attempt to get smaller local banks who are more likely to serve the smallest businesses more involved in the program.
About $60 billion will go toward another Small Business Administration (SBA) program that has run out of funds. The EIDL program provides grants up to $10,000 and loans up to $2 million to small businesses. EIDL will get a $10 billion injection for grants and $50 billion for loans.
Finally, the legislation provides $75 billion in additional aid to health-care systems, many of which have been overburdened with COVID-19 cases and seen a slowdown in elective surgeries, and $25 billion for the Trump Administration to develop and expand access to COVID-19 tests. It further requires the administration to develop a plan to provide greater testing support and access for states.
President Trump is expected to quickly sign the bill to enable banks to once again begin processing PPP applications and the SBA to restart the EIDL program.