Coronavirus PPP loan recipients may get extension of 8-week window to use funds, McCarthy says

Provision is one of a few GOP lawmakers are looking at changing, top House Republican said

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The top Republican lawmaker in the House of Representatives on Tuesday said he was open to extending the window that Paycheck Protection Program loan recipients have to use their funding.

During a press conference in D.C., McCarthy said GOP lawmakers have discussed “a number of fixes” that could be made to the CARES Act, including lengthening the eight-week window for businesses to use their PPP loans.

“Can we give those small businesses flexibility, move that out 10, maybe 12 weeks?” McCarthy said. “Those are things that we’re discussing.”

PPP CORONAVIRUS LOANS: FORGIVENESS MAY NOT BE AS SIMPLE AS BUSINESS OWNERS THINK

As previously reported by FOX Business, the eight-week window was one of the top reasons experts said complete loan forgiveness would be more difficult than business owners expected.

While loan amounts are based on either two and a half times the average monthly payroll costs for 2019 or the trailing 12 months (up to $10 million), the window to use it is only eight weeks, which experts have called “an inherent math problem.”

It is particularly problematic for business owners in the restaurant industry, whose operations remain either fully or partially closed. The industry has repeatedly argued for lawmakers to extend the timeframe that PPP recipients have to use the loan.

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Another fix that McCarthy said lawmakers were looking to address is how expanded unemployment benefits decrease the incentive for some workers to return to work, which has, in turn, hurt the ability of small business owners to rehire employees – another condition they are required to fulfill in order to achieve complete PPP loan forgiveness.

The Small Business Administration on Tuesday said its lenders had given out more than 4.3 million loans worth more than $513 billion.

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