Feb. 22 – Monday, the Biden administration announced changes to help small businesses that continue to be disrupted by the pandemic of COVID-19, particularly those operated by people of color.The start of a two-week window, during which only companies with less than 20 employees will apply for assistance through the Paycheck Protection Program, the federal program established at the height of the crisis a year ago, is one of the key improvements.
“Small businesses are the engines of our economic progress. They’re the glue and the heart and soul of our communities. But they’re getting crushed,” said Biden. “It’s hurting Black, Latino and Asian American communities the hardest.”The service ends on March 31, but only small companies will be able to apply for the next two weeks. It is intended to give small businesses the first federal assistance opportunity to avoid the issues that existed when the CARES Act was created last year.
Last year, the government under former President Donald Trump was criticized after many large businesses, including the NBA’s Los Angeles Lakers, Shake Shack and Nathan’s Popular, applied for and obtained funds from the initiative, which is largely intended as a solution for smaller payroll companies.Susie Lee, D-Nev., Debbie Mucarsel-Powell, D-Fla., Roger Williams, R-Texas, and Vicky Hartzler, R-Mo. The Trump administration was also criticized for paying out loans to companies connected to lawmakers, including White House press secretary Kayleigh McEnany and Reps.
In the current round of PPP funding, small companies were awarded $134 billion. When at least 60 percent of the money is used for payroll costs such as wages, pensions and community health benefits, the loans are forgiven.The reforms on Monday also include provisions to assist sole owners and self-employed employees, remove a restriction that forbids PPP assistance for business owners with previous convictions of non-fraud crime and end a restriction that prohibited loans from going to federal student loan delinquency owners. The initiative also increases access for non-citizens living in the United States as legal residents.The White House further explained that the policy requires close monitoring and transparency to mitigate excessive spending and encourage accountability.