by Tyler Arnold
Virginia businesses will benefit from the federal government extending the deadline to apply for Paycheck Protection Program forgivable loans, according to associations representing industries.
With bipartisan support, federal lawmakers passed legislation to extend the loan application from March 31 to May 31 and give the Small Business Administration an additional 30 days to process the applications. The legislation is expected to be signed by President Joe Biden.
The loans allow businesses economically harmed by the COVID-19 pandemic and subsequent economic restrictions to borrow money from the federal government. If businesses use the money in accordance with federal guidelines, the loans will be forgiven, meaning that the businesses will not have to pay the money back.
Money acquired through these loans are meant to help businesses maintain payroll at a time in which revenues are still low and some industries have needed to lay off workers.
The loans will help “keep businesses afloat for a couple more months” as the pandemic hopefully comes to an end, Nicole Riley, the Virginia state director for the National Federation of Independent Business, told The Center Square. She said her members are excited to hear the deadline was quickly extended before it expired.
Riley said the loans have helped a lot of small businesses in industries that have been the hardest hit by the pandemic. She said the relief bill, which passed earlier this month, will particularly help restaurants and the entertainment industry, which have been hit harder than most. The legislation gives these businesses access to more money than some other businesses.
However, another association said hotels should be given more priority as they’ve struggled amid fewer people traveling and the inability to host large gatherings. Financial recoveries for the hotel industry have been much slower than some other industries, Robert Melvin, the director of government affairs at the Virginia Restaurant, Lodging & Travel Association, told The Center Square.
Though, the extension on the PPP loan applications does help many of the association’s members, Melvin said. He said federal lawmakers should seek to make the money as widely available to businesses as possible. The association has also been working with state lawmakers on ways to help businesses recover.
Riley said the NFIB is watching what the state government does with the federal funding provided in the relief bill. She said the association is encouraging lawmakers to use funds to bulk up the unemployment insurance funding to avoid a future tax increase on businesses while they’re still recovering from the pandemic. If the money is available, she said the state should also consider using the federal money to bolster the Rebuild Virginia program, which provides funding for businesses struggling during the COVID-19 pandemic.
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Tyler Arnold reports on Virginia and West Virginia for The Center Square. He previously worked for the Cause of Action Institute and has been published in Business Insider, USA TODAY College, National Review Online and the Washington Free Beacon.