Today, President Trump signed the Paycheck Protection Program and Health Care Enhancement Act (Act), which makes available an additional $310 billion for loans under the Paycheck Protection Program (PPP) loans and $60 billion for the Emergency Injury Disaster Loan (EIDL) program. Additionally, the Act provides $100 billion to the Department of Health and Human Services’ Public Health and Social Services Emergency Fund (HHS Fund).
PPP Funds
The Act does not change the PPP loan eligibility or forgiveness rules. The Act, however, does allocate $30 billion of the loan funds to banks, credit unions and community financial institutions with less than $10 billion in assets, and another $30 billion for banks and credit unions with assets of between $10 billion and $50 billion. These provisions are intended to address concerns that small businesses in underserved communities had more difficulty accessing PPP loans than some larger businesses that had pre-existing relationships with banks.
EIDL Funds
The Act allocates an additional $60 billion for the EIDL program, with $50 billion directed towards additional EIDL loans and $10 billion for the EIDL advances. EIDL loans and advances were designed for small businesses that had suffered substantial economic damages caused by COVID-19 pandemic. Until this new appropriation, the Small Business Administration (SBA) was unable to accept new EIDL applications.
HHS Fund
The Act allocates an additional $100 billion through the HHS Fund to support health care providers and COVID-19 testing initiatives. Specifically, $75 billion is appropriated to support hospitals and providers experiencing COVID-19 related expenses and lost revenue. The remaining $25 billion is directed toward supporting various government agencies; such as the Center for Disease Control (CDC) and National Institutes of Health (NIH); states and local governments; and private employers with necessary expenses to research, develop, validate, manufacture, purchase, administer and expand capacity for COVID-19 tests.
