The brand new HEALS Act introduced in Congress by GOP Senators Marco Rubio and Susan Collins, as it stands, would allow eligible small business to apply for an additional Paycheck Protection Program (PPP) Loan. This second forgivable loan would be part of the Republican party’s version of a secondary COVID-19 stimulus bill. The loan would be available to any businesses that can demonstrate a minimum 50% reduction in gross revenues since the pandemic erupted across the United States in March. This bill, however, is not an exact replica of the original PPP Act; it instead contains modifications to address complaints from small businesses. These modifications include but are not limited to: streamlining forgiveness application processes for loans less than $150,000, allowing borrowers to choose the eight-week period in which to use their newly allocated funds, and expanding forgivable expenses to covered supplier costs, worker protection expenditures, operations expenditures, and certain property damage (including damage from looting in the June 2020 riots).
This bill would act as an extension of the original coronavirus relief package, known as the CARES Act, loosening the restrictions of the PPP component of the original legislation. This is primarily due to the smallest businesses getting hit hardest by the pandemic. A May 2020 report by the SBA’s Office of Advocacy showed that employers with 20 to 49 employees had employment declines, on average, of 21.5%, whereas businesses with more than 1000 employees saw a considerably smaller decline of 13.3%. In its current form, the HEALS Act could potentially act as a lifeline to small businesses across the nation, especially those that are minority-owned or in low-income areas and in dire need of financial assistance.
While Valley Financial cannot help you with PPP Loans, we felt it is important for you to know the updates. To apply for any PPP loans, you have to work with an SBA approved bank. For industrial machine and CNC equipment financing, please contact us today.
Written by Rasjot Singh