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Paycheck Program Ends With $130 Billion Unspent, and Uncertainty Ahead
https://www.nytimes.com/2020/06/30/business/paycheck-protection-program-coronavirus.html
The program distributed forgivable loans to five million small businesses that could use the money to pay workers to stay home. But shifting rules blunted its effect.
The Paycheck Protection Program provided a financial safety net for West Virginia Eye Consultants, where Crystal Newhouse was working in the firm’s Beckley office on Monday.
By Stacy Cowley
June 30, 2020, 5:00 a.m. ET
After a stumbling start three months ago, the government’s centerpiece relief program for small businesses is ending with money left over.
The Paycheck Protection Program is scheduled to wrap up on Tuesday after handing out $520 billion in loans meant to preserve workers’ jobs during the coronavirus pandemic. But as new outbreaks spike across the country and force many states to rethink their plans to reopen businesses, the program is closing down with more than $130 billion still in its coffers.
“The fact that it was able to reach so far into the small-business sector is a major achievement, and those things are worth acknowledging, and celebrating,” said John Lettieri, the chief executive of the Economic Innovation Group, a think tank focused on entrepreneurship. “But we’re still in a public health crisis, and we’re facing a long, slow, uneven return. Millions of businesses still have their survival at risk.”
The hastily constructed and frequently chaotic aid program, run by the Small Business Administration but carried out through banks, handed out money to nearly five million businesses nationwide, giving them low-interest loans to cover roughly two and a half months of their typical payroll costs. Those that use most of the money to pay employees can have their debt forgiven.
</snip>
The program distributed forgivable loans to five million small businesses that could use the money to pay workers to stay home. But shifting rules blunted its effect.
The Paycheck Protection Program provided a financial safety net for West Virginia Eye Consultants, where Crystal Newhouse was working in the firm’s Beckley office on Monday.
By Stacy Cowley
June 30, 2020, 5:00 a.m. ET
After a stumbling start three months ago, the government’s centerpiece relief program for small businesses is ending with money left over.
The Paycheck Protection Program is scheduled to wrap up on Tuesday after handing out $520 billion in loans meant to preserve workers’ jobs during the coronavirus pandemic. But as new outbreaks spike across the country and force many states to rethink their plans to reopen businesses, the program is closing down with more than $130 billion still in its coffers.
“The fact that it was able to reach so far into the small-business sector is a major achievement, and those things are worth acknowledging, and celebrating,” said John Lettieri, the chief executive of the Economic Innovation Group, a think tank focused on entrepreneurship. “But we’re still in a public health crisis, and we’re facing a long, slow, uneven return. Millions of businesses still have their survival at risk.”
The hastily constructed and frequently chaotic aid program, run by the Small Business Administration but carried out through banks, handed out money to nearly five million businesses nationwide, giving them low-interest loans to cover roughly two and a half months of their typical payroll costs. Those that use most of the money to pay employees can have their debt forgiven.
</snip>
