Biden to revise small business loans to reach smaller, minority firms

US President Joe Biden will launch changes on Monday to the main U.S. coronavirus aid program for small businesses to try to reach smaller, minorityowned firms and sole proprietors left behind in previous rounds of aid.

Biden administration officials said that for two weeks starting on Wednesday, the Small Business Administration will only accept applications for forgivable Paycheck Protection Program (PPP) loans from firms with fewer than 20 employees to ensure that they are not crowded out by larger firms. The changes, to be formally announced by Biden on Monday, come as small business bankers say demand for Paycheck Protection loans is slowing as firms reopen.

When the PPP was launched in April 2020 at the height of coronavirus lockdowns under a $3 trillion relief bill, its initial $349 billion ran out in two weeks. Congress approved another $320 billion in May, but the program expired in August with about $130 billion in unused funds. The program was re-launched on Jan. 19 with $284 billion in new funds from a coronavirus aid bill passed at the end of December, and a Biden administration official said about $150 billion of PPP money is still available.

But Biden administration officials said there are still many minority and very small firms in low-income areas that have not been able to receive aid. The changes aim to make it easier for firms with no employees -- sole proprietors, independent contractors, and self-employed people such as house cleaners and personal care providers -that could not qualify previously because of business cost deductions.

The Small Business Administration will revise the rules to match the approach used to allowed small farmers and ranchers to receive aid, the businesses said.

The officials said the program will also set aside $1 billion for businesses without employees in low- and moderate-income areas, which are 70% owned by women and people of color. The SBA will provide new guidance making it clear that legal U.S. residents who are not citizens, such as green card holders, cannot be excluded from the program.

The Biden Administration will also eliminate exclusions that prohibit a business owner who is delinquent on student loans from participating in the program. Business owners with nonfraud felony arrests or convictions in the previous year are excluded from the program, but Biden administration officials said they will adopt bipartisan Senate proposals to remove this restriction unless the applicant is currently incarcerated.

Meanwhile, A US Senate panel will hold a hearing on Wednesday on efforts to boost crumbling U.S. transport infrastructure, which will include testimony from two key governors

Michigan Governor Gretchen Whitmer, a Democrat, and Maryland Governor Larry Hogan, a Republican, will be among those testifying at the Senate Environment and Public Works (EPW) hearing titled "Building Back Better: Investing in Transportation while Addressing Climate Change, Improving Equity, and Fostering Economic Growth and Innovation" Whitmer won attention in 2018 when she successfully ran for governor using the slogan "Fix the Damn Roads."

Hogan as chair of the National Governors Association launched a national initiative focused on fixing U.S. infrastructure and released a report noting "Americans have lost countless hours of their lives in soulcrushing traffic." President Joe Biden has made modernizing aging U.S. infrastructure a key priority after his predecessor Donald Trump failed to win approval from Congress for major upgrades.

Biden plans to ask Congress in coming weeks to invest heavily in infrastructure amid studies showing close to half of U.S. roads are in poor or mediocre condition and more than a third of U.S. bridges need repair, replacement or significant rehabilitation. Earlier this month, Biden met with top leaders of the Senate EPW committee.

While infrastructure investment is viewed as a bipartisan issue, Trump and congressional leaders failed to agree on a major bill to repair and replace aging and dangerous bridges, airports, water pipes and other projects. Funding has been a point of contention in recent years after Congress abandoned a decades-old policy of using fuel tax revenue to largely pay for infrastructure repairs. In 2019, Trump and Democratic congressional leaders agreed to spend $2 trillion over a decade, but the Republican president never proposed any new revenue source to pay for upgrades. Denver Mayor Michael Hancock and Victoria Sheehan, president of the American Association of State Highway and Transportation who heads the New Hampshire Department of Transportation, will also testify Wednesday.