House Small Business Committee Releases Reconciliation Text Increasing PPP Funding
Tomorrow, the House Small Business Committee will mark-up the Committee’s portion of the budget reconciliation bill through which congressional Democrats plan to advance the next round of COVID-19 relief.
With regard to the Paycheck Protection Program, the Small Business Committee has introduced legislation to: (1) increase by $7.25 billion the amount of funding for the PPP to $813.7 billion; and (2) expand the eligibility of nonprofits to include a new category—“additional covered nonprofit entities”—which are nonprofits listed in section 501(c) of the Internal Revenue Code other than 501(c)(3)s, 501(c)(4)s, 501(c)(6)s or 501(c)(19)s to receive an initial PPP loan.
In order for “additional covered nonprofit entities” to be eligible to receive a PPP loan, the organization: (1) must not receive more than 15 percent of its receipts from lobbying activities; (2) must not derive more than 15 percent of its activities from lobbying; (3) must not exceed $1,000,000 on lobbying expenses during the most recent tax year that ended prior to February 15, 2020; and (4) must not employ more than 300 employees.
Finally, the bill would also strike the application of the Small Business Administration’s affiliation rules to nonprofits by allowing 501(c)(6)s to be eligible for PPP loans as long as the organization does not employ more than 300 employees per physical location of the organization.
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