Nov 27, 2024
Local Issues
Henrico Citizen: Spanberger, others urge SBA to eliminate PPP stipulation
Apr 09, 2020
Economy & Jobs
In the News
Local Issues
Requirement that at least 75% of loan amount be used for payroll too strict, representatives say
HENRICO CITIZEN
U.S. Congresswoman Abigail Spanberger, who represents the western half of Henrico County and Virginia’s Seventh District, joined with seven other members of the House of Representatives yesterday to issue a letter urging the U.S. Small Business Administration and Department of Treasury to improve flexibility for small businesses that are seeking federal assistance and own forgiveness through the SBA’s Payroll Protection Program, or PPP.
The version of the CARES Act passed by Congress required businesses that received a PPP loan not to reduce their total payroll by more than 25 percent in order to have the loan fully forgiven. But the SBA later added a much stricter stipulation, saying that loan recipients must spend at least 75 percent of the money on payroll (leaving only 25 percent for rent or utilities payments) or else risk having to pay some of the loan back.
Spanberger, a Democrat, joined with five other Democrats and two Republicans to urge officials to eliminate that provision.
“We ask that you rescind this requirement and allow small businesses the flexibility, within the parameters set forth by Congress, to use the PPP loans as necessary to keep their individual business afloat,” the eight wrote.
In addition to Spanberger, the letter was signed by U.S. Representatives Paul Mitchell (R-MI-10), Kathleen Rice (D-NY-04), Brian Fitzpatrick (R-PA-01), Dean Phillips (D-MN-03), Jason Crow (D-CO-06), Elaine Luria (D-VA-02), and Gil Cisneros (D-CA-39).