The Biden administration officials and lawmakers did not address the concern, which focused on the $ 1.9 billion relief bill from the Democrats, which includes another $ 7 billion for the OBP, but the program would not does not extend. Members of Congress are just beginning a possible expansion, but with about $ 120 billion in PPP funding left, it is not certain that they will move quickly to address the issue, which fuels a sense of confusion among borrowers responsible for issuing the aid.
“They have no answers,” said David Pommerehn, chief adviser to the Consumer Bankers Association. “They are preparing for the worst case scenario, and this is the program that shuts down completely on March 31 at 11:59 p.m.”
The uncertainty is the latest drama surrounding the massive aid program Covid-19, which has provided nearly 7.6 million loans to employers since its inception in March 2020. The loans are popular because they can be forgiven if employers agree to continue paying employees. PPP has been a roller coaster for borrowers and moneylenders since its inception, due to the ever-changing rules and the shifting of deadlines.
President Joe Biden and White House officials on Tuesday took a victory over recent changes they have made to ensure the smallest businesses have access to the PPP, while the president visits a Washington hardware store that has received assistance.
But the messages in the White House – including a remark by a top official of the National Economic Council – that there is still enough time to apply – did not capture the reality that PPP lenders are withdrawing and not accepting rules that Biden promised to help small businesses. get funds.
Rachel Ball, a sole proprietorship who owns a corporate event business, was one of the Chase PPP applicants who announced Monday afternoon that the bank would not accept the new rules that allow businesses like her to qualify for more money not. Ball, who uses Chase for her business banking, now faces the choice between betting on another moneylender with the clock ticking or, according to the old rules, making a smaller loan.
“I feel like I’m in a limbo,” Ball said.
Chase spokeswoman Anne Pace said the bank supports calls for a PPP expansion and that it will implement Biden’s changes if an expansion goes through. According to Pace, each application can take weeks to go through the approval and financing phases, and that the bank is focused on the large number of applications before the end of the month.
Chase’s remarks reflect those of banking associations urging Congress and the Small Business Administration, which runs the EMP, to find a way to process applications after March 31.
Banks have warned that the SBA’s decision to step up fraud against fraud this year has led to new delays in the application pipeline due to the time it takes to resolve issues identified by the agency after reviewing loan requests. Bank of America, which stops accepting applications on Tuesday, said it has 30,000 underway and wants to give enough time to get everyone through the SBA on March 31.
In a March 5 letter to lawmakers, the American Bankers Association and other lender groups said they were “seriously concerned” about how many PPP loans held in the SBA’s application system would remain unresolved until March 31. The lenders said they are also concerned that new loans submitted to the SBA this month will remain outstanding if the SBA system is shut down.
The National Association of Government Guaranteed Lenders proposes that Congress set a ‘double deadline’ that requires applications to be submitted by April 30 and then approved on May 31. The last month is used to erase issues that stop loans.
The Banking Policy Institute and the Consumer Bankers Association, which represents large PPP lenders, are asking the SBA to have loan applications that have caused error messages and “hold codes” processed by banks and the SBA at least until June. 30. The Agency may implement the proposal by granting “conditional” approval and committing funds for applications received before 31 March.
“By doing so, it will help thousands of qualifying borrowers whose applications are without any fault of administrative delays or subject,” the two groups said in a March 3 letter to the SBA.
“[I]an experience of our members is that many of the smallest lenders, and therefore those who mostly need the most PPP loans, are subject to a greater number of SBA holdings than larger lenders, “they wrote. As such, smaller lenders that the Administration and the SBA have identified need greater and more streamlined access to funds, and this could pose the greatest danger of losing access to funds. ‘
The SBA and Congress are beginning to signal that they will work on a solution.
An SBA spokesman said the agency had not decided whether it would be able to process a pending application once the March 31 deadline for approval had passed. Patrick Kelley, co-administrator of the SBA’s Office of Capital Access, which manages the PPP, told a small business webinar on Monday that the agency is working on an ‘administrative solution’ to enable PPP applicants to receive money after the program has expired. Since the issue was not resolved, his advice to businesses was ‘do not wait’ to apply.
Legislators are starting to support a PPP expansion. House Small Business Chair Nydia Velázquez (DN.Y.) is seeking a three-month extension. Senator Jeanne Shaheen (DN.H.), a member of the Senate Committee on Small Business, said ‘extending the deadline for the PPP is a common sense step we can and must take.”
“Small businesses are still feeling the effects of the pandemic and there is a strong demand for the PPP program,” Velázquez told POLITICO. ‘With PPP expiring at the end of the month, I am working closely with leaders in the Senate and government to reach an agreement on expanding PPP in a way that meets the needs of small business owners. ”
It is unclear how the leadership of the House and Senate will proceed. House Spokeswoman Nancy Pelosi and Senate Majority Leader Chuck Schumer did not respond to questions about whether they would support the continuation of the PPP.
A White House official who did not want to be named said if Congress wanted to push back the PPP deadline, “we can discuss a way forward with them.”
“At the moment, we are committed to delivering aid dollars quickly and fairly in the time we have left,” the White House official said, adding that the government is also committed to enforcing Biden’s aid bill, which provides relief for include small businesses.
Some Republican lawmakers, according to assistants and lobbyists, are willing to work on expanding the program. Business groups are trying to frame the issue as a two-way victory after the big party line battle over Biden’s relief bill.
“What better way to reach out to Republicans who feel burned out by promises of duality, than to relieve in small business relief?” says Matthew Haller, chief lobbyist at the International Franchise Association.
Rep. Chip Roy (R-Texas), who last year led work on legislation to review an earlier iteration of the PPP, will support an expansion, a spokesman said. Rep. Blaine Luetkemeyer (R-Mo.), The top Republican in the House’s Small Business Committee, said in a statement that the OBP ‘has assisted millions of small businesses since its inception, and as the vaccines become more and more available and states begin to we must responsibly examine the future of the program. ‘