Congressman Gonzalez Votes to Help Workers and Small Businesses by Supporting Passage of Key Fixes to Paycheck Protection Program

WASHINGTON – Today, Congressman Vicente Gonzalez (TX-15) voted to pass a critical, bipartisan bill to deliver further relief for small businesses in the 15th District of Texas. Led by Congressmen Dean Phillips of Minnesota and Chip Roy of Texas, H.R. 7010, the Paycheck Protection Program Flexibility Act makes key fixes to the Paycheck Protection Program (PPP) to assist small business owners in South Texas and across the country who are struggling the most as a result of the coronavirus.

"The Paycheck Protection Program is far from perfect but thanks to the input of countless small business owners, particularly in the service and hospitality industries, the House passed legislation to provide urgently-needed adjustments so that the most vulnerable small businesses have the flexibility to obtain the assistance they urgently need," said Congressman Gonzalez. "I will continue to monitor the distribution of these loans like a hawk and do everything in my power to prevent fraud, corruption and abuse."

Many small businesses in Texas as well as across the country, have reported that the current limit in the PPP program of only 25 percent of loan proceeds being used for nonpayroll expenses such as rent, prevents them for applying for PPP loans. For many small businesses, including for example small independent restaurants, their rent or mortgage interest tend to be significantly more than 25 percent of their total monthly expenses. Hence, to address their concerns, this bill raises that percentage from 25 percent to 40 percent.

The bipartisan PPP Flexibility Act will increase flexibility and access to PPP loans including by:

• Allowing forgiveness for expenses beyond the 8-week covered period to 24 weeks and extending the rehiring deadline;
• Increasing the current limitation on nonpayroll expenses (such as rent, utility payments and mortgage interest) for loan forgiveness from 25 to 40 percent;
• Extending the program from June 30 to December 31;
• Extending loan terms from two to five years; and
• Ensuring full access to payroll tax deferment for businesses that take PPP loans.

"This unprecedented coronavirus pandemic has inflicted a staggering toll on hard-working South Texans," continued Congressman Gonzalez. "I am committed to doing whatever is necessary to get our small businesses and workers back on their feet. South Texans deserve no less."