Manchester, N.H. – Today Representatives Chris Pappas (NH-01) and Annie Kuster (NH-02) along with their Senate colleagues Senators Jeanne Shaheen (D-NH) and Maggie Hassan (D-NH) sent a letter to the Secretary Steven Mnuchin calling on the Treasury to make adjustments to the Payroll Protection Program (PPP) so that it can more effectively serve the needs of Granite State small businesses. 

PPP provides small businesses with zero-fee loans of up to $10 million and allows up to 8 weeks of average payroll to be forgiven for businesses that retain their employees and their salary levels. Although this has become a lifeline for many, additional changes need to be made to better serve small businesses facing the economic conditions due to this pandemic. 

Specifically, the letter to Treasury Secretary Steven Mnuchin urged him to use his authority under current law to extend the maturity of new PPP loans from 2 years to 10 years and enable borrowers to refinance existing loans at 10 years. These more lenient terms will help struggling Granite State small businesses to weather a painful and protracted economic recovery. 

“In light of the unprecedented challenges that these businesses are facing, we urge you to exercise your authority under the CARES Act to provide flexibility to small businesses to extend the term of their loans from 2 years to 10 years and give businesses that have already received these loans the option to refinance at 10 years,” the lawmakers wrote. “This step will provide a much-needed reprieve to small businesses struggling to keep their doors open during the prolonged recovery period. Indeed, every dollar that a small business owner must expend to meet their federal loan obligations is a dollar that cannot be spent on overhead, payroll or other immediate needs.”

Last week Pappas also urged Speaker Nancy Pelosi and Republican Leader Kevin McCarthy to make changes to the program in the next relief package, including granting small businesses the ability to renew their PPP loans, offering businesses greater flexibility to determine when the program’s loan forgiveness period will begin, and allowing small businesses more latitude to use PPP funding to meet their individual needs. 

You can read the full text of the letter here and below: 

Dear Secretary Mnuchin: 

We know that you share our commitment to working in a bipartisan manner to strengthen the small business lending programs that represent a critical lifeline for America’s struggling Main Street economy. To that end, we write to urge you to take immediate action to reduce the financial burden borne by participants in the Payroll Protection Program (PPP), specifically by extending the maturity of PPP loans. 

As you know, under PPP, small businesses can access up to $10 million in financing and, of those funds, a sum equal to 8-weeks of payroll expenses can eventually be forgiven, provided that certain conditions are met. However, those loan proceeds that are not forgiven must be repaid over a two-year period at a one percent interest rate, with no payments in the first six months.

The CARES Act (P.L. 116-136) grants you broad latitude to set the terms and conditions of PPP loans. Unfortunately, it is becoming increasingly clear that small businesses across the country could be forced to contend with a protracted economic recovery. In light of the unprecedented challenges that these businesses are facing, we urge you to exercise your authority under the CARES Act to provide flexibility to small businesses to extend the term of their loans from 2 years to 10 years and give businesses that have already received these loans the option to refinance at 10 years. 

This step will provide a much-needed reprieve to small businesses struggling to keep their doors open during the prolonged recovery period. Indeed, every dollar that a small business owner must expend to meet their federal loan obligations is a dollar that cannot be spent on overhead, payroll or other immediate needs. It is also worth noting that a comparable federal loan product – the Economic Injury Disaster Loan – is offered at a term of up to 30 years. 

Thank you for your urgent attention to this request. Extending the maturity of PPP loans will give participating small businesses a better chance to weather the current economic downturn while also meeting their loan obligations. We look forward to continuing to work with you to strengthen federal support for the small business owners and workers who form the backbone of the Granite State economy.