Eliminate an exclusionary restriction that prevents small business owners who are delinquent on their federal student loans from obtaining relief through the Paycheck Protection Program.To expand access to PPP, the Biden-Harris administration will adopt bipartisan reforms included in the PPP Second Chance Act, co-sponsored by Senators Ben Cardin (D-MD), Rob Portman (R-OH), Cory Booker (D-NJ), and James Lankford (R-OK), which would eliminate the second restriction (the one-year look-back) unless the applicant or owner is incarcerated at the time of the application. Currently, a business is ineligible for PPP if it is at least 20 percent owned by an individual who has either: (1) an arrest or conviction for a felony related to financial assistance fraud within the previous five years or (2) any other felony within the previous year. Consistent with a bipartisan bill, eliminate an exclusionary restriction that prevents small business owners with prior non-fraud felony convictions from obtaining relief through the Paycheck Protection Program.To address this problem, the Biden-Harris administration will revise the loan calculation formula for these applicants so that it offers more relief, and establish a $1 billion set aside for businesses in this category without employees located in low- and moderate-income (LMI) areas. Yet many are structurally excluded from the PPP or were approved for as little as $1 because of how PPP loans are calculated. ![]() Of these businesses, those without employees are 70 percent owned by women and people of color. These types of businesses, which include home repair contractors, beauticians, and small independent retailers, make up a significant majority of all businesses. Help sole proprietors, independent contractors, and self-employed individuals receive more financial support.The Biden-Harris administration will also make a sustained effort to work with lenders and small business owners to ensure small businesses take maximum advantage of this two-week window. The 14-day exclusive application period will allow lenders to focus on serving these smallest businesses. ![]() And while the Biden-Harris administration has directed significantly more relief to these smallest businesses in this round of PPP than in the prior round, these businesses often struggle more than larger businesses to collect the necessary paperwork and secure relief from a lender. They are Main Street businesses that anchor our neighborhoods and help families build wealth. 98 percent of small businesses have fewer than 20 employees.
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