By Nick Goldstein, ARTBA vice president of regulatory and legal issues
President Donald Trump June 5 signed the bipartisan “Paycheck Protection Program Flexibility Act,” a new law that will reduce regulatory burdens associated with the Paycheck Protection Program (PPP), which provides emergency small business loans.
ARTBA recommended and supported a number of changes to the program that was enacted in March to help businesses weather the COVID-19 pandemic.
Key updates in the new law include:
- Increasing flexibility in how loan recipients can spend PPP funds by changing the amount of the loans which can be spent on non-payroll costs from 25 percent to 40 percent;
- Extending the time period to spend the funds from eight weeks to 24 weeks; and
- Providing additional flexibility under the program’s “safe harbor” date for rehiring employees and restoring their pay.
It also extends the program application deadline to Dec. 31 from June 30, and increases the loan term to five years from two years.