April 22, 2020
Late in the afternoon on Tuesday, April 21, the Senate approved, by unanimous consent, the Paycheck Protection Program and Health Care Enhancement Act (the Act). The legislation totals $484 billion and proposes to provide funding for small businesses, hospitals, and coronavirus testing.
The Act, if passed, would provide $321 billion of additional funding for the Paycheck Protection Program (PPP), which provides potentially forgivable loans to businesses. The initial $349 billion of funding for this program ran out last week, a mere two weeks after being launched. The SBA reported that to date the program provided nearly 1.7 million loans. The size of the loans varied, but 74% of them were for $150,000 or less. North Carolina businesses received just over $8 billion in loans through the initial round of funding.
Responding to concern that smaller banks and lenders did not have enough resources to participate as much as larger banks in the first round of PPP loans, the Act earmarks $60 billion for smaller lenders such as credit unions and certain community financial institutions. It’s expected that these smaller lenders will have greater access to help small businesses. The Act also includes $60 billion in loans and grants for economic disaster assistance, another Small Business Administration program that was depleted recently.
Lastly, the Act would provide $75 billion for eligible health care providers and $25 billion for coronavirus testing. Of that testing money, $11 billion would go to states, local governments, US territories, tribes, tribal organizations, urban Indian health organizations, or health service providers to tribes in order to develop, purchase, administer, process and analyze COVID–19 tests.
The House is expected to take up this legislation on Thursday. If passed, the bill would then go to the President for signature.
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Johnson Price Sprinkle PA is a 60+ year old accounting firm providing small to middle-market businesses with tax, business consulting, audit, and technology solution services. With offices in Asheville, Boone, and Marion, NC, our CPAs and JPS team strive to provide personal service alongside technical expertise resulting in our clients’ long-term financial success. We also invest time and energy in our community, taking pride in doing what we can to make Western North Carolina a better place. JPS Mission: To Be Greater by positively impacting our Clients, People, Community and Profession.