Lawmakers propose extending PPP coronavirus rescue aid through May

PPP lending last year softened the blow from COVID-19, helping 5.2 million small businesses maintain employment for 51 million U.S. workers, according to the SBA. The SBA so far this year has approved 2.4 million PPP loans totaling $165 billion.

Small businesses account for 44% of gross domestic product and employ nearly half of U.S. workers, according to the White House.

"With the ongoing distribution of COVID-19 vaccines, there is a light at the end of the tunnel, but we’re not there yet," Republican Sen. Susan Collins of Maine, a bill co-sponsor, said in a statement. "That is why we need to extend the deadline for the PPP now."

The bi-partisan bills would give the SBA until June 30 to process applications due at the end of May.

The SBA has faced criticism that $525 billion in PPP lending last year did not sufficiently help businesses in economically distressed communities identified under the historically underutilized business zones (HUBZones). Such businesses received just one-quarter of PPP aid in 2020, according to analysis by the Tax Policy Center.

President Biden last month provided businesses with fewer than 20 workers exclusive access to the application process for PPP loans for a two-week period. Ninety-eight percent of small businesses have fewer than 20 employees, the White House said.

"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 told a Feb. 22 news conference, adding that 400,000 small businesses have shut down since the start of the pandemic "and millions more are hanging by a thread."