Each member of Alabama’s congressional delegation voted in support of a bill to ease restrictions on businesses receiving loans under the Paycheck Protection Program (PPP) that passed Congress this week and now heads to President Donald Trump’s desk.
The bill extends the time businesses have to spend their loans from eight to 24 weeks. Additionally, to qualify for loan forgiveness, borrowers would now be required to spend 60% of the loan on payroll where it had been 75% previously.
The Trump administration told Politico that the program has saved 50 million jobs across the country. The Birmingham Business Journal is reporting that $6 billion in PPP funds have been distributed in Alabama.
The PPP was created as part of the $2.2 trillion stimulus packages known as the CARES Act that Congress passed in March as an attempt to alleviate the economic effects of the coronavirus pandemic.
The program proved so popular that legislation to replenish the funds proved necessary later in April.
The initial rollout of the program saw overwhelming demand that swamped many loan providers and led to some small businesses not receiving their loans in a timely fashion.
The kinks were later ironed out, and currently, the federal government holds $120 billion in PPP funds still available for a small business in need.
The initial eight-week deadline to pay back the loan for businesses that did not qualify for loan forgiveness was rapidly approaching for many PPP recipients.
Both payroll and rent/mortgage costs are eligible for forgiveness under the program.
Politico reported that some lenders expect an amount of renewed interest in the loans given the extended time available for repayment.