President Biden on Monday announced policy changes to the Paycheck Protection Program (PPP) meant to target coronavirus relief to the smallest businesses and minority-owned firms.
Among the changes, the Small Business Administration is instituting a 14-day period beginning Wednesday and running through March 9 allowing only companies with fewer than 20 employees to apply for assistance through the PPP.
“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,” Biden said in remarks at the White House, noting that roughly 400,000 small businesses have closed amid restrictions put in place to lessen the spread of the coronavirus.
“It’s hurting Black, Latino and Asian American communities the hardest,” he continued.
Biden voiced support for the PPP, a loan program established under the Trump administration when Congress passed the bipartisan CARES Act last year. However, he criticized the program allowing smaller firms to be “muscled out” by bigger companies.
Biden announced Monday that his administration would change its loan calculating formula for sole proprietors, independent contractors and self-employed individuals to more easily secure forgivable PPP loans.
The administration is also doing away with restrictions preventing individuals with prior non-fraud felony convictions or those who are delinquent on their federal student loans from receiving funds through the PPP.
Finally, the Biden administration is expected to move forward with new guidance clarifying that noncitizen small-business owners who hold green cards or are in the U.S. on a visa can obtain PPP loans.
The president also said Monday that he would increase oversight of the program, inviting any inspector general with jurisdiction over the loans to review them and publicly report any inconsistencies with the policies he laid out.
“We will ensure every dollar is spent well,” he said.
The Trump-era program has been popular but withstood scrutiny last year as data showed that much of the assistance went to larger U.S. businesses, including some major chains.
Biden used the remarks on Monday to push for the swift passage of his $1.9 trillion coronavirus relief proposal, which is working its way through Congress and is expected to pass the House as soon as this week.
“This is a starting point, not an ending point. We need congress to pass my American rescue plan. It deals with the immediate crisis facing our small businesses,” he said.
Biden noted that his proposal would put $50 billion toward helping small businesses after the end of the PPP, which is due to expire at the end of March.
Biden said he hoped the relief proposal would garner Democratic and Republican support, challenging critics to specify what they would cut from it.
Updated at 1:27 p.m.