House approves changes to emergency business lending program

The U.S. House on Thursday easily passed legislation intended to give small businesses applying for emergency loans through the Paycheck Protection Program more flexibility on how to use the money.

The House voted 417-1 to pass the bill as the chamber took more action under its new proxy voting rules, which congressional Republicans are fighting in court.

The bill was spearheaded by Rep. Dean Phillips, Minnesota Democrat, and Rep. Chip Roy, Texas Republican.

“We have not a moment to lose,” Mr. Phillips said.

The bill gives businesses applying for money through the program 24 weeks to use the money for the loan to be forgiven, up from the current eight-week time frame.

Under the bill, businesses also have to use at least 60% of the money for payroll expenses — down from a 75% threshold when the program was first approved via a $2.2 trillion relief package in March.

“With this new flexibility, our communities will be one step closer to fully recovering from this pandemic,” said Rep. Joe Wilson, South Carolina Republican.

Across the Capitol, senators in both parties have teamed up to introduce similar legislation.

Earlier, the House fell short of the two-thirds majority it needed to advance another bill from Mr. Phillips that would require the Small Business Administration to identify borrowers who secure PPP or emergency disaster loans worth more than $2 million.

The votes came as lawmakers remain at odds over how and whether to pass another comprehensive coronavirus relief bill after Congress has signed off on close to $3 trillion worth of rescue legislation in recent months.

Congress has authorized more $650 billion in PPP money in separate bills in recent months. The first round of $350 billion in funding was quickly exhausted, forcing lawmakers to follow up and replenish the funding with another emergency package.

The Trump administration said Thursday that more than 4.4 million loans have been approved and more than $510 billion worth of loans is out the door.

The SBA also said Thursday it was setting aside $10 billion of the second round of funding for financial institutions that specialize in working with lower-income communities.

Treasury Secretary Steven T. Mnuchin estimated that the program has helped save 50 million jobs in the country and said more than 4 million small businesses have benefited.

While popular, the program has also been marred with significant technical glitches and complaints from small businesses about getting access to the funds even as loans were approved for major chains like Ruth’s Chris Steak House and Shake Shack.

Amid public outcry, some of those larger businesses said they would return the money.