WASHINGTON – Yesterday, the Senate unanimously passed the Small Business Lending Continuity Act of 2020. This bipartisan legislation, led by U.S. Senators Jim Risch (R-Idaho) and Tammy Duckworth (D-Ill.), will make a technical correction to the CARES Act and prevent the Small Business Administration’s (SBA) flagship 7(a) Loan Guarantee Program from shutting down when the Paycheck Protection Program (PPP) reaches its authorization cap of $310 billion. The SBA 7(a) program provides small businesses with capital to start or grow a business and is widely used among Idahoans.
“The Small Business Administration lending programs have provided a lifeline to millions of small businesses across America impacted by the COVID-19 pandemic,” said Risch. “It is critical that the 7(a) program continue dispersing relief to small business owners without interruption in the event the Paycheck Protection Program runs out of funding. The Small Business Lending Continuity Act will provide the necessary technical fix to the CARES Act so Main Street businesses can continue to access the 7(a) program without hesitation or delay.”
“As small businesses work to recover from the COVID-19 pandemic, we should be making it easier—not more cumbersome—for them to access and rely on loan programs,” said Duckworth. “I’m proud to introduce this bipartisan bill that offers a simple fix to prevent SBA’s 7(a) loan program from shutting down, while reinstating the flagship program’s full authorization level to make sure small business owners may continue to access critical working capital funds.”
In addition to the popular Paycheck Protection Program, the CARES Act also authorized a $17 billion small business debt relief program, directing the SBA to cover loan payments for six months to all small business borrowers of SBA-backed loans and for borrowers that take out SBA-backed loans within six months of the CARES Act passage. If the SBA 7(a) loan program shuts down — which the Small Business Lending Continuity Act would prevent — small businesses seeking these loans won’t be able to access them and wouldn’t be eligible for six months of SBA covering their loan payments.
Additional cosponsors of the bill include Senators Marco Rubio (R-Fla.), Chris Coons (D-Del.), Ben Cardin (D-Md.), Marsha Blackburn (R-Tenn.) and Jeanne Shaheen (D-N.H.).
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