The Biden-Harris Administration announced that businesses with fewer than 20 employees will institute a two week period, beginning Wednesday that will limit applications for the Payroll Protection Program to businesses with 20 or fewer employees.
In announcing the change, the administration noted that 98 percent of all small businesses are in the 20 and under category.
“They are Main Street businesses that anchor our neighborhoods and help families build wealth. And while the Biden-Harris administration has directed significantly more relief to these smallest businesses in this round of PPP than in the prior round, these businesses often struggle more than larger businesses to collect the necessary paperwork and secure relief from a lender,” a White House release stated.
The administration claimed the latest round of the PPP program represents a marked improvement on the prior round of the Program last year.
The first round of the PPP was marked by controversy over larger companies getting to the front of the line, due to relationships with lenders, with women and minority-owned businesses being left behind.
The announcement from the Biden Administration comes as his home state of Delaware remains in last place in the number and dollar value of PPP approvals.
The program consists of loans that can be forgiven if proceeds are used to retain employees.
- Help sole proprietors, independent contractors, and self-employed individuals receive more financial support. These types of businesses, which include home repair contractors, beauticians, and small independent retailers Businesses without employees are 70 percent owned by women and people of color. The administration will revise the loan calculation formula so that it offers more relief, and establish a $1 billion set aside for businesses in this category without employees located in low- and moderate-income areas.
- Consistent with a bipartisan bill in Congress, eliminate a restriction that prevents small business owners with prior non-fraud felony convictions from obtaining relief through the Paycheck Protection Program.
- Eliminate a restriction that prevents small business owners who are delinquent on their federal student loans from obtaining relief through the Paycheck Protection Program.
- Ensure access for non-citizen small business owners who are lawful U.S. residents by clarifying that they may use Individual Taxpayer Identification Numbers (ITINs) to apply for relief.
Click here for the briefing paper from the administration.