The small business rescue fund program hit its limit late yesterday and is now out of money. As a result, the SBA is currently unable to accept new applications for the Paycheck Protection Program and Economic Injury Disaster Loan program. Lawmakers and the Trump Administration are now pushing for another $200-500 billion to supplement the SBA loan funds.The entire Coronavirus Relief Package has ended up costing less than many thought, which will be $1.8 trillion over the next decade instead of the predicted $2.3 trillion. With this cost reduction, legislators now more than ever are pushing to keep small businesses funded, and as a result keep the economy from collapsing further.
Although both parties generally agree on $250 billion in additional funds, Democrats want extra cash for hospitals, food assistance and state and local governments, while Republicans want to keep the focus purely on small businesses. The uncertainty of unemployment and health care costs within the next year or more makes it difficult to implement certain provisions on the Federal level. Regardless, SBA and PPP loans are a necessity to keep these businesses and their workers afloat, and it is clear that additional funding will need to be passed in a quick and timely manner.
Iowa banks worked round-the-clock to secure the first round PPP funds for Iowa small businesses, processing 22,000+ loans over $3.8 billion and providing paycheck relief for an estimated 325,000 jobs. Iowa banks stand ready to continue this work on behalf of Iowa’s small businesses as soon as Congress authorizes an additional appropriation, as these funds are crucial to keeping Iowa’s communities and economy alive. A lapse in funds is problematic for Iowa and our nation.
The Iowa City Area Business Partnership has been communicating to our Congressional delegation how important these programs are and urging them to replenish the funds. We know that many or our businesses are relying on these programs to get by during this crisis.
We encourage you to reach out to federal elected officials in support of swift action for additional money to fund small businesses.