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The Senate passed a $484 billion aid package on Tuesday, which includes an additional $310 billion in funding to replenish the tapped-out Paycheck Protection Program.
The bill goes to the House, which is expected to vote on the package Thursday. It will take the Office of Management and Budget about a day and a half to deposit the money with the Small Business Administration once the law is passed — meaning that if President Trump signs the bill on Thursday night, loans could be processed as soon as Saturday.
Banks are expected to issue new guidance for small business owners on Friday.
FILE – In this April 15, 2020 file photo, two people walk past a closed sign at a retail store in Chicago. (AP Photo/Nam Y. Huh) (Associated Press)
When Congress created the $349 billion program, which ran out of cash last Thursday, it directed the loans at companies with fewer than 500 employees. But restaurants and hotels were granted some flexibility in the legislation — so long as they employed no more than 500 workers at any single location, they could apply for the aid.
In their haste to get life support to small businesses, Congress did not exclude publicly traded companies or limit market value in the economic-relief plan that passed last month. Regardless of how much cash a company had in the bank, if the business could show any loss as a result of the virus outbreak, it qualified for a small-business loan through the PPP, according to an SBA source.
That opened the program to a slew of big firms that could have received help via different avenues, like the Federal Reserve.
At least 75 publicly traded companies – some with market values well over $100 million — tapped the government-backed Paycheck Protection Program, receiving a combined $300 million in low-interest loans, according to a recent Associated Press analysis.
The loans were among the 4,412 approved by banks and the Small Business Administration worth $5 million or more, according to SBA data. The total amount of loans approved for at least $5 million totaled $30.9 billion — or about 9 percent of all those approved. The size of the typical loan nationally was $206,000, according to the data.
The backlash against the program began this week, after national restaurant chains that employed thousands of workers before the crisis secured millions of dollars in small-business loans. Among the companies were Potbelly Corp., the nationwide sandwich shop chain, Ruth's Hospitality Group, which operates a series of steakhouses and Shake Shack.
Facing growing anger, Shake Shack said Monday it will return the $10 million loan it received, making it the first major firm to give back the money intended to protect small businesses. The burger chain runs close to 189 restaurants in the U.S., with about 45 employees in each location. In 2019, it reported revenue of roughly $600 million.
The returned money will be added to the pot and distributed with the second round of aid.
FOX Business' Edward Lawrence contributed to this report.