Business, Lender Groups Call for Streamlined PPP Forgiveness for Mom & Pop Businesses
Business, Lender Groups Call for Streamlined PPP Forgiveness for Mom & Pop Businesses
More than 140 trade associations in coalition of small businesses, banks & credit unions
WASHINGTON – The Consumer Bankers Association and a coalition of more than 140 trade groups representing small business borrowers and lenders today sent a letter to Congressional Leaders advocating for the passage of bipartisan legislation introduced by Reps. Chrissy Houlahan (D-Penn.) and Fred Upton (R-Mich.) to streamline Paycheck Protection Program forgiveness for the smallest borrowers. The legislation, The Paycheck Protection Program Small Business Forgiveness Act (H. 7777), currently has two dozen cosponsors.
The bipartisan House legislation and its Senate counterpart, S. 4117 introduced by Sens. Kevin Cramer (R-N.D.), Bob Menendez (D-N.J.), Thom Tillis (R-N.C.) and Kyrsten Sinema (D-Ariz.), calls for streamlined forgiveness of PPP loans less than $150,000 if the borrower answers a simple, one-question attestation the funds were used in accordance to PPP guidelines to retain employees. Nothing in the legislation prevents the audit of PPP loans less than $150,000 for fraud.
Simplified forgiveness could collectively save the smallest small businesses owners more than $7 billion dollars and hours of paperwork. The coalition letter notes independent analysis by AQN Strategies anticipates the combined small business resource requirements of time and/or third-party expenses could represent an effective cost of $2,000-$4,000 for each business that applies for forgiveness, requiring 20-100 hours of time.
“This bipartisan legislation would ensure our nation’s small business owners can focus their time, energy, and resources back into their business and communities instead of allocating significant time and resources into completing complex forgiveness forms. Given the dire economic data released this week and ongoing challenges facing small businesses we urge the House to take up and pass this legislation without delay,” the associations wrote. “Small businesses and their employees are the backbone of our nation’s economy and communities. Their time and resources would be better focused on getting the economy safely back up and running, not processing burdensome paperwork.”
The original forgiveness process outlined by the Small Business Administration required five pages of calculations and extensive financial know-how, which would require the majority of mom-and-pop businesses to hire outside accountants. Even the SBA’s ‘EZ’ form would take significant resources for America’s smallest businesses to complete.
A copy of the letter is available here along with a full list of signatories, representing millions of small businesses, banks, credit unions and other financial institutions.
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