Feb. 22 (UPI) — The Biden administration announced changes Monday designed to prop up small businesses that continue to be hindered by the COVID-19 pandemic, particularly those owned by people of color.
Chief among the changes is the start of a two-week window, during which only businesses with fewer than 20 employees can apply for aid through the Paycheck Protection Program — the federal program created a year ago at the start of the crisis.
“Small businesses are the engines of our economic progress. They’re the glue and the heart and soul of our communities. But they’re getting crushed,” Biden said. “It’s hurting Black, Latino and Asian American communities the hardest.”
The program expires March 31, but for the next two weeks only those small businesses will be eligible to apply. It is designed to give small businesses the first chance at the federal aid to avoid the problems that occurred when it was created last year by the CARES Act.
The government under former President Donald Trump was criticized last year after several major corporations — including the NBA’s Los Angeles Lakers, Shake Shack and Nathan’s Famous — applied for and received funds from the program, which is designed primarily as a remedy for small businesses with smaller payrolls.
The Trump administration was also criticized for paying out loans to businesses linked to politicians, including White House press secretary Kayleigh McEnany and Reps. Susie Lee, D-Nev., Debbie Mucarsel-Powell, D-Fla., Roger Williams, R-Texas, and Vicky Hartzler, R-Mo.
Small businesses were awarded $134 billion in the latest round of PPP funding. The loans are forgiven if at least 60% of the money is used for payroll expenses like wages, salaries and group health insurance.
Monday’s changes also include provisions to help sole proprietors and self-employed workers, lift a restriction that bars PPP aid for business owners with prior non-fraud felony convictions and end a restriction that barred loans from going to owners with federal student loan delinquency.
The plan also improves access for noncitizens who are legal residents of the United States.
Additionally, the White House said the strategy includes close monitoring and transparency to mitigate wasteful spending and promote accountability.