Aindriu Colgan | NSWA Vice President, Governmental Affairs
House Votes to Expand PPP
Last week, the House of Representatives voted 417-1 to approve bipartisan expansions to the Paycheck Protection Program (PPP) to help more businesses qualify for loan forgiveness. Under the original terms of the program, loan recipients must spend all funds within eight weeks and 75% of funds must be spent on payroll. Any unforgiven loans must be repaid within two years.
The Paycheck Protection Program Flexibility Act would loosen those requirements so that more businesses can qualify for loan forgiveness. The bill would give loan recipients 24 weeks to spend funds and allow them to spend just 60% of funds on payroll, which adds much needed flexibility to pay for other overhead expenses like rent and utilities. It would also extend the PPP’s loan application deadline from June 30 to December 31, 2020, and, for future borrowers, the bill would extend repayment time to five years.
Before leaving for the Memorial Day recess, the Senate also began considering changes to the PPP. That legislation would extend the window for businesses to spend all loan proceeds to 16 weeks. The Senate is expected to consider the House legislation when it gavels into session this week. While a few of the details between the chambers’ proposals differ, Senate Small Business and Entrepreneurship Committee Chairman Marco Rubio (R-FL) believes they are not “insurmountable” differences and expects the upper chamber to pass program changes with little objection.
Trump Administration Cuts Royalty Payments for Oil Companies
According to records obtained by Politico, the Interior Department has cut oil and gas royalties to a fraction of their pre-pandemic levels. The Department has not issued any rulemaking cutting royalties across the board, so these reductions were granted on a case-by-case basis. According to guidance from the Bureau of Land Management (BLM), the agency will process any applications for royalty reduction within five days and any waiver granted will last for 60 days, after which a company can request a renewal.
Hoyer Breaks with House Democrats on Strategic Petroleum Reserve
Last month, House Majority Leader Steny Hoyer (D-MD) urged fellow lawmakers to take advantage of historically low oil prices to refill the Strategic Petroleum Reserve (SPR). In doing so, he broke with his own party which repeatedly blocked the inclusion of any funds for SPR oil purchases from coronavirus relief packages.
Leader Hoyer also announced that he does not intend and will not support efforts to block oil and gas companies from participating in any coronavirus relief programs for which they are eligible. “I don’t think that’s a question of being for or against oil companies. We are for employees who have lost their livelihood. And we’re wanting to help them and want to help their families.”