Expiring small businesses program could be extended
WASHINGTON – Treasury Secretary Steve Mnuchin told lawmakers Tuesday that the administration is negotiating extension of a huge loan program that has helped keep millions of small businesses afloat during the coronavirus pandemic.
The Paycheck Protection Program has disbursed more than $500 billion to roughly 4.8 million businesses, most of them mom-and-pop outfits such as nail salons and retail stores. The program was to have ended Tuesday with $130 billion unallocated and scores of hospitality businesses on the brink of insolvency.
Mnuchin told the House Financial Services Committee that he’s already in talks with senators about passing another round of economic stimulus that would use the leftover PPP money “and extending it to business that were most hard hit … like restaurants and hotels where it is critical to get people back to work.”
Congressional leaders and administration officials who negotiated the economic stimulus measure in March known as the CARES Act that created the PPP are discussing next steps amid a pandemic that has claimed 125,000 lives, caused the highest unemployment in decades and upended daily life.
Not only does the PPP end Tuesday, but the federal boost in unemployment benefits ends July 31 at a time when states are seeing new surges in infections and are proposing layoffs to balance budgets hammered by the pandemic.
“We’re not out of this thing by any stretch of the imagination,” said Rep. Ed Perlmutter, D-Colo., a member of the panel. “I see a brick wall at the end of July.”
House Democrats passed the HEROES Act in May. The measure would steer billions to financially socked states and local governments and provide a second round of direct payments to millions of Americans. It was panned by Senate Republicans and declared “dead on arrival” by President Donald Trump.
At more than $3 trillion, the HEROES Act (the Health and Economic Recovery Omnibus Emergency Solutions Act) would be larger than the four previous economic stimulus packages combined that Congress has approved since March to combat the coronavirus.