On June 4, the U.S. Congress passed a bill to ease some of the rules and regulations for the Paycheck Protection Program. The bill has been sent to President Donald Trump to be signed into law. In general, the bill will be giving farms and businesses more flexibility in how and when PPP loans can be spent while still getting these loans forgiven.
More specifically, the bill increases the time that businesses have to spend loan funds from eight weeks to 24 weeks. These funds are for payroll and other qualified expenses such as rent and utilities. The bill also lowers the amount of loan funds that must be spend on payroll expenses in order for the loan to be forgiven to 60%. Currently, the minimum amount is 75%.
The bill passed the House last week by 417-1 and passed the Senate unanimously.
Congress created the program with the CARES Act to help small businesses survive the impact of the COVID-19 pandemic. According to Agri-Pulse.com, as of May 30, 2020, banks have processed 127,465 PPP loans to total $7.6 billion to farmers and other businesses. Agri-Pulse.com also stated that the Farm Credit institution has made 13,851 loans totaling $1.3 billion as of May 30, 2020.