The US Senate, just hours before the expiration of the small business loan Paycheck Protection Program, passed an extension of the program to August 8.
The move to keep the application process for the program open comes as it was set to expire with more than $130 billion in allocated funds that remain unused. The program was designed to offer small business loans to bridge the shutdowns and help businesses keep employees in their jobs – and in turn, the loans taken out would be forgiven, essentially shifting into a grant.
More than 4.8 million small business owners have utilized the program, which was designed as a bridge for companies to maintain their payrolls through the worst of the pandemic.
While it faced a rocky rollout and dozens of shifting and new rules in its initial stages, more than $520 billion has been deployed to keep small businesses afloat.
Tuesday’s extension came as a surprise, even to Democrats who forced the action on the floor. While there had been discussions about moving the deadline, there were no substantive moves towards agreement on one until shortly before it actually reached the floor.
“The resources are there, the need is there, we just need to change the date,” Sen. Ben Cardin of Maryland, the top Democrat on the Small Business Committee, said on the Senate floor.
The bill, proposed by Senate Democrats, was passed by unanimous consent.
The Democratic-led House would still need to act on the extension.
That money has become central to negotiations over the next round of small business aid, which has been subject of bipartisan discussions over the last several days.
Cardin noted the extension lines up with the end of the next Senate work period – which is the same timeline Senate Republicans have set to complete the next round of stimulus.
Senate Small Business Committee Chairman Marco Rubio of Florida, the lead Republican negotiator, said he had no objections to the extension, “but the vast majority of small business that wanted to benefit from the program have already used it.”
“What we really need to pass very soon is targeted help for those who need a second round of aid,” Rubio tweeted Tuesday night.
The extension doesn’t put an end to the ongoing talks – and given the relative lack of interest in the $660 billion program in recent weeks based on total loan data, the extended time period is unlikely to sap the available funds.
But it would keep the central federal lifeline to small businesses open as lawmakers seek agreement on next steps.
This story has been updated with additional developments.