Valley National Bank president and CEO Ira Robbins says he was surprised the second round of Paycheck Protection Program loans wasn’t spent quickly, considering the high demand for them in the first round.
The House of Representatives quickly passed a bill Wednesday night to extend the window for business owners to apply for coronavirus relief loans through the Paycheck Protection Program.
A day after the Senate unanimously approved the extension, the House also passed the legislation by unanimous consent, sending the bill to President Trump‘s desk.
The deadline for small businesses to apply for coronavirus relief funds expired Tuesday, but the legislation would reopen the application process until Aug. 8.
During the pandemic, Congress allocated $659 billion to small businesses in PPP loans that could be converted to grants if they met certain requirements. Congress already passed legislation to loosen some of the restrictions on the loans that businesses found too burdensome given that many are still closed or operating at reduced capacity due to prolonged stay-home restrictions.
As of 5 pm Tuesday, the Small Business Administration had approved 4,866,647 loans worth roughly $521 billion across 5,459 lenders.
The average loan size was $107,199.
On Tuesday Treasury Secretary Steven Mnuchin said there was about $135 billion left over in unclaimed funds that had not been lent to small business owners.
The House passed the loan application extension Wednesday in a matter of minutes.
Rep. Angie Craig, D-Minn., asked to take up the Senate bill and no House members objected. A smattering of applause broke out in the chamber upon its passage.
In a statement, Craig said it made sense for businesses to have more time to tap the more than $130 billion in unused funds.
“It’s simple: small businesses deserve access to the remaining funds in the Paycheck Protection Program. We’ve asked our Main Streets to be flexible and adapt to unprecedented impacts from a global pandemic, and today I ask my colleagues to do the same,” Craig said.
This is the latest in a series of actions Congress has taken to boost the PPP program.
The Paycheck Protection Flexibility Act, signed into law by President Trump on June 5, extended the time for business to use the PPP money from eight weeks to 24 weeks. It eliminated the cumbersome 75/25 restrictions that forced businesses to spend 75 percent of their loans on payroll and only 25 percent on other operating expenses like rent and utilities. The formula changed to 60/40 percent. For loans that aren’t forgiven, businesses now have more time for repayment, from two years to five years.
The Paycheck Protection Flexibility Act also extended the time businesses needed to make a “good faith” effort to rehire employees from June 30 to Dec. 31, 2020.
Fox News’ Chad Pergram and Fox Business’s Brittany De Lea and R.N. White contributed to this report.