On May 28, House of Representatives overwhelmingly passed the AGC-backed Paycheck Protection Program Flexibility Act (H.R. 7010), which would make substantial improvements to the Paycheck Protection loan Program (PPP). Since the program was created in the CARES Act, many construction firms have taken advantage of it. However, AGC has identified a number of problems with the program, and H.R. 7010 addresses several of those concerns by: (1) extending the “covered period” for PPP loans from eight to 24 weeks; (2) revising the uses of loan funds eligible for forgiveness from 75 percent in payroll costs/25 percent in non-payroll costs to 60 percent/40 percent, respectively; (3) creating a safe harbor for employers that made a good faith effort to hire or re-hire qualified employees; (4) extending the maturity of PPP loans from two to five years; and (5) allowing PPP loan recipients to defer payroll taxes through the end of 2020. AGC will continue to press for passage of this legislation in the Senate as well as seek additional improvements to the loan program, including but not limited to the waiver of the SBA affiliation rules presenting a barrier to entry for many small, family-owned construction businesses.
For additional questions, please contact Matthew Turkstra, Director of Tax, Fiscal Affairs, and Accounting at (202) 547-4733, or email@example.com.