Rep. Tulsi Gabbard Votes to Expand Flexibility in Paycheck Protection Program to Help Small Businesses and Workers

Press Release

Today, Rep. Tulsi Gabbard (HI-02) voted for H.R.7010, the Paycheck Protection Program Flexibility Act, which would provide additional flexibility for small businesses to use PPP loan funds to make qualifying expenditures for loan forgiveness. She is a cosponsor of the bill.

H.R.7010 passed by a vote of 417-1 and now heads to the Senate for consideration. The Senate may take up the bill as early as next week when it is due back in session.

"The coronavirus crisis has created economic hardship for small businesses and workers at levels not seen since the Great Depression and Congress is responding with massive emergency relief efforts. Based on feedback from small businesses about challenges with the initial round of funding for the PPP, this bill seeks to address those shortcomings and provide the flexibility and assistance that will best serve those businesses and employees who are the backbone of our economy," said Rep. Tulsi Gabbard.

Background: H.R.7010, the Paycheck Protection Program Flexibility Act, would:

Extend the PPP loan forgiveness period to include costs incurred over 24 weeks after a loan is issued or through Dec. 31, whichever comes first. Businesses that received a loan before the measure is enacted could keep the current eight-week period.
Extend to Dec. 31 from June 30 a period in which loans can be forgiven if businesses restore staffing or salary levels that were previously reduced. The provision would apply to worker and wage reductions made from Feb. 15 through 30 days after enactment of the CARES Act, which was signed into law on March 27.
Maintain forgiveness amounts for companies that were unable to rehire employees or resume business levels as of Feb. 15, or find similarly qualified workers by the end of the year.
Extend the deadline to apply for a PPP loan to Dec. 31 from June 30.
Bar the SBA from limiting loan forgiveness for expenses other than payroll.
Repeal a provision from the CARES Act that barred companies with forgiven PPP loans from deferring their payroll tax payments.
Establish a minimum loan maturity period of five years following an application for loan forgiveness, instead of the current two-year deadline set by the SBA.
Increases the current limitation on non-payroll expenses (such as rent, utilities, mortgage interest) for loan forgiveness from 25 to 40%
Removing Retroactivity on the increase of maturity period from 2 to 5 years
Clarifies Safe Harbors Language that employers provide documentation when unable to rehire employees, and to clarify an "inability to return to the same level of business activity," refers explicitly to compliance with HHS, CDC, OSHA standards on social distancing or any other worker or customer safety requirement related to COVID-19.
Extended payment deferral on principal and interest so that a borrower does not have to make a payment until forgiveness determination is granted by the SBA.

Rep. Gabbard also voted to pass H.R.6782, the Small Business Transparency and Reporting for the Underbanked and Taxpayers at Home (TRUTH) Act, would require the Small business Administration to make information about COVID-19 economic relief programs publicly available. However, even though a majority of the House supported the bill, it failed to earn the 2/3 majority required for it to pass.

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