U.S. Senators Bob Menendez (D-NJ), Kevin Cramer (R-ND), Thom Tillis (R-NC) and Kyrsten Sinema (D-AZ), Senate Banking Committee members, introduced the Paycheck Protection Small Business Forgiveness Act, bipartisan legislation to streamline forgiveness of Paycheck Protection Program (PPP) loans for small businesses.
“Small businesses across New Jersey and the country are doing everything they can to withstand the economic impact of this unprecedented pandemic. And, for many of them, PPP loans have been their only available lifeline to keep their doors open. We want them to succeed. We want them to keep people employed and keep serving their communities,” said Sen. Menendez. “The bipartisan Paycheck Protection Small Business Forgiveness Act cuts these struggling small businesses a break when they need it most by providing them full forgiveness on PPP loans of $150,000 or less. Automatically forgiving PPP loans for these small businesses allows them to focus their limited resources on keeping their business going and makes it easier for them to have their PPP loans forgiven. I would urge my colleagues on both sides of the aisle to support this commonsense legislation.”
The Paycheck Protection Small Business Forgiveness Act includes forgiveness for PPP loans of $150,000 or less if the borrower submits a simple, one-page attestation form to the lender. It also ensures the lender will be held harmless from any enforcement action if the borrower’s attestation contained falsehoods.
The approximately 3.7 million PPP loans of $150,000 or less account for 85 percent of all PPP approved loans but only 26 percent of the PPP funds delivered. The cost of applying for forgiveness for a PPP loan of this size is $2,000 for the small business and $500 for the lender. The bipartisan legislation introduced today could save small businesses $7.4 billion and banks nearly $2 billion.
National support for the PP Small Business Forgiveness Act
The legislation is supported by leading banking groups, as well as members of the agricultural community, who applauded its introduction.
“The current forgiveness application is unnecessarily burdensome for many businesses, particularly the smallest of small businesses without the administrative support needed to complete the form. Small businesses and their employees are the backbone of our nation’s economy and communities,” said Consumer Bankers Association President and CEO Richard Hunt. “This bipartisan automatic forgiveness process will allow businesses to focus their time and resources on seeing customers and hiring employees instead of hiring consultants to fill out paperwork.”
“Providing a safe-harbor for smaller PPP loan forgiveness is a top priority for the ICBA,” said Paul Merski, Executive Vice President of the Independent Community Bankers Association. “ICBA appreciates and supports the needed relief these senators are advancing on PPP loan forgiveness and it will help both small businesses and lenders better serve their customers and communities.”
“America’s credit unions wholeheartedly support the Paycheck Protection Small Business Forgiveness Act,” said Credit Union National Association President and CEO Jim Nussle. “This bill will allow America’s small business owners and Main Street financial institutions to remain focused on serving their communities rather than on jumping through burdensome regulatory hurdles.”
“Farm Credit is grateful to these senators for introducing this common sense legislation,” Todd Van Hoose, CEO of the Farm Credit Council. “It will greatly simplify the Paycheck Protection Program loan process for farmers impacted by the Covid-19 pandemic and ensure they get those loans forgiven quickly as intended.”
Local Support in NJ of the PP Small Business Forgiveness Act
“Senator Menendez’s legislation will be critical in helping New Jersey reopen successfully,” said Tom Bracken, President and CEO of the New Jersey Chamber of Commerce. “We need our businesses to focus on the priorities of reopening – namely finding adequate capital to operate and taking the steps required to ensure their workplaces are safe and secure. Removing the worry about the time, paperwork and costs associated with repaying these loans would allow businesses to focus on these critical priorities. This legislation will be of immense help to all of New Jersey’s business community, especially small businesses, sole proprietorships and minority-owned businesses. The New Jersey Chamber of Commerce thanks Senator Menendez for heeding our call for help and taking the lead on this issue
“NJBIA is fully supportive of the Paycheck Protection Small Business Forgiveness Act as it will help our employers financially in this very challenging time, and also allow them to focus on their operations without the need to hire professional service firms to assist them in seeking their relief,” said Michele Siekerka, President and CEO of the New Jersey Business & Industry Association.
“On behalf of the Statewide Hispanic Chamber of Commerce of NJ I applaud Senator Menendez for the introduction of the PPSBFA, as someone on the ground whose organization has helped thousands of businesses I can attest to the fact that these businesses are in crisis,” said Carlos Medina, Chairman of the Statewide Hispanic Chamber of Commerce. “These small businesses are the same small businesses that helped dig the USA out of the great recession of 2009. Help them now so they can continue to fuel the US economy.”
You might be interested: SBA provides Disaster Assistance Loans for Coronavirus impacted small businesses by states
“As Chairwoman of the North Jersey Chamber of Commerce and Owner of CFO Your Way, I see firsthand the struggles small businesses are going through during these unprecedented times – not only to keep their doors open, understand and apply for the available loans and grants, but now the stress of applying for forgiveness of PPP funds that they received,” said Cheryl Mucha, Chairwoman of the North Jersey Chamber of Commerce. “Many of the members of the NJCC and most of our clients received less than $150,000 of funding. When they saw the forgiveness application, it raised concern and stress levels for these business owners again. The need to hire someone to help them through the process is just another cost to incur. Giving automatic forgiveness to those businesses that received $150,000 or less will give the opportunity for these businesses to concentrate on what is most important – getting their doors open and resuming operations. We thank Senator Menendez for introducing this critical piece of legislation and implore his colleagues to swiftly pass this bill that will undoubtedly help North Jersey small businesses.”
“We applaud Senator Menendez for his continued advocacy for small businesses during this economic crisis,” said Jane Asselta, Vice President of Southern NJ Development Council. “Automatic forgiveness of PPP loans for small and micro-sized businesses is a relief to many of our local businesses that may not be back up and running at full capacity as expected. These business owners are experiencing tremendous financial pressures of reopening timelines, safety enhancements and employee training, and supply chain delays and price increases. Knowing the PPP loan they were fortunate to qualify for and receive will be forgiven removes the added expense burden necessary in converting the loans to grants. Real relief. We thank Senator Menendez for his leadership and tenacity in giving these business owners an increased chance to survive.”
“The Chamber of Commerce and the Cumberland Development Corporation will definitely support the effort of Senator Menendez to make the Paycheck Protection Program and the forgiveness more streamlined, and easier for smaller businesses,” said Tony Stanzione, Executive Director of the Bridgeton Area Chamber of Commerce and the Cumberland Development Corporation. “That would help them a lot. Anything we can do to lessen the paperwork burden and the cost to them at this time is critical to their recovery.”
You might be interested: How to request forgiveness for PPP sole proprietor
“Our small businesses in Cape May County are fighting for survival. In many cases, they have just reopened and are operating at a limited capacity,” said Vicki Clark, President of the Cape May County Chamber of Commerce. “ The Small Business Forgiveness Act is a crucial piece of legislation that will allow those businesses to skip a burdensome forgiveness application process that would take their much-needed attention away from running their business – many of which are only open during this summer season.”