Nearly two-thirds of Maine small businesses have received PPP loans, among the highest rates in the nation
Washington, D.C.—U.S. Senator Susan Collins spoke on the Senate floor this afternoon to urge the Senate to swiftly pass legislation she introduced with Senators Marco Rubio (R-FL), Ben Cardin (D-MD), and Jeanne Shaheen (D-NH) that would extend and increase flexibility for the Paycheck Protection Program (PPP) they co-authored. The PPP provides critical support for America’s small employers and their employees, who are struggling with the consequences of economic shutdowns aimed at fighting the spread of COVID-19.
Since its launch in early April, the program has provided loans totaling more than $510 billion to approximately 4.3 million small employers across the country. The overwhelming majority of borrowers are very small. In Maine, the average borrowers had an estimated 12 employees in Phase I and three employees in Phase II.
“According to the U.S. Census Bureau, nearly two-thirds of small businesses in Maine have received PPP loans, which is among the highest rates in the nation. These funds are sufficient to support approximately 200,000 jobs,” said Senator Collins from the Senate floor. “It is important to remember the real businesses, and real people, behind these numbers. People like Larry Geaghan, who owns and runs a craft brewery and pub in Bangor, Maine. Larry calls the PPP a ‘lifeline bill’ that has made the difference in helping him bring back 25 of his employees and reopen for takeout business.
“The Paycheck Protection Program is the single-most critical stimulus program protecting Main Street America from the economic consequences of measures taken to contain the spread of COVID-19,” Senator Collins continued. “The bill we are introducing today strengthens the PPP to reflect evolving economic needs, and I urge my colleagues to support it.”
Under current law, the PPP provides small employers with eight weeks of funds to pay their workers, protect their jobs, and help cover certain overhead expenses until the economy can safely reopen. The Paycheck Protection Program Extension Act would extend the PPP to reflect the fact that economic shutdowns have lasted longer than originally anticipated, and to provide small employers with more flexibility in the use of loan funds.
Specifically, the Paycheck Protection Program Extension Act would:
- Extend the deadline to apply for a PPP loan from June 30, 2020, to December 31, 2020.
- Allow borrowers 16 weeks to use their loan funds, instead of 8 weeks. The bill would give borrowers the flexibility to choose when to use their 8-weeks of funds during this 16-week period.
- Allow borrowers to use loan funds to purchase personal protective equipment for employees and to pay for adaptive investments needed to reopen safely. Adaptive investments include modifications to a commercial property to comply with public health guidelines from CDC and other relevant federal agencies. They could include creating or expanding a drive-through window, physical barriers such as sneeze guards, ventilation system upgrades, etc.
- Clarify that the current lender hold-harmless provision relates to all SBA/Treasury guidance regarding PPP loans. This would ensure that lenders who followed PPP guidance released by SBA/Treasury could not later be held liable if that guidance subsequently changed.
- Clarify that borrowers who have maintained payroll for 8 weeks will not lose loan forgiveness due to the extension of the program to 16 weeks.