Rep. Jaime Herrera Beutler, R-Battle Ground, says she’s working on new legislation aimed at bolstering the Paycheck Protection Program by increasing its funding and duration.
The program was created as part of the CARES Act, the $2 trillion relief package that Congress passed to help mitigate the economic impact of the COVID-19 crisis. It allows small businesses to apply for loans to help cover payroll costs, and the loans can be forgiven if business owners keep their workers employed during the emergency.
“Our goal is to emerge from the crisis as whole as possible, obviously health-wise but also economically,” Herrera Beutler said in a Thursday joint press call with Rep. Derek Kilmer, D-Gig Harbor.
Herrera Beutler and Kilmer said the payroll program is working as intended, aside from some technical hiccups with the rollout. But they cautioned that the program’s $349 billion funding from the CARES Act likely won’t be enough to cover all of the businesses that need help.
The program began accepting applications last week. Kilmer said that as of Thursday, it had received 454,000 applications nationwide, totaling $118 billion dollars. The program’s June 30 end date might be too soon, he added, resulting in businesses being cut off before the pandemic subsides.
“We may still be in a national emergency come that time,” he said.
Kilmer and Herrera Beutler said their planned legislation, which they called the Paycheck Protection Program Extension Act, would address those concerns by adding additional funding and changing the time frame so the program terminates 30 days after the end of the emergency, rather than on a preplanned date.
The bill would also create an automatic renewal mechanism so that qualified businesses will remain enrolled for the duration of the crisis, and they won’t have to repeat the cumbersome application process.
The initial rollout of the program has faced logistical and technical challenges, Herrera Beutler said, as well as a lack of adequate guidance for applicants. She said she had heard feedback from numerous local businesses and lenders expressing confusion about unclear directions.
The U.S. Small Business Administration is working to provide guidance, she said, but its local offices have been struggling to keep up with the number of calls that have been coming in from businesses and lending institutions.
Some of the confusion is an unavoidable result of the program’s speedy rollout, the representatives added. The Small Business Administration has been building the program from scratch and writing guidance at the same time, a situation that Kilmer analogized to building an airplane while flying it.
“By the end of this week, we’re certainly going to be in a much better place as far as getting those answers,” Herrera Beutler said.
Herrera Beutler and Kilmer sent a joint letter Thursday to Treasury Secretary Steven Mnuchin and Small Business Administration Administrator Jovita Carranza, urging them to tighten up the program by improving the loan application system, issuing additional guidance for businesses and lenders, and enhancing the responsiveness of the local Small Business Administration offices.