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Rep. Chip Roy introduces bill to revamp PPP rules

Yahoo Finance’s Jessica Smith joins Zack Guzman to discuss her interview with Congressman Chip Roy (R-TX), as he spearheads a bipartisan bill to change paycheck protection program rules for businesses.

Video Transcript

ZACK GUZMAN: Right now, Republicans and Democrats continue to debate what is necessary in the next round of stimulus in regards to the coronavirus crisis we're still seeing play out despite the fact that states are reopening.

For more on that, I want to get to Yahoo Finance's Jessica Smith, who has the latest in that [INAUDIBLE]. Jessica.

JESSICA SMITH: Well, right now, Zack, lawmakers are trying to revamp the Paycheck Protection Program after business leaders say that there are problems with the current rules. They just don't give them enough flexibility to spend the money that they're getting from these loans that are supposed to be forgivable.

So next week the House will vote on this bill to give business owners that flexibility. I talked to Congressman Chip Roy. He's the Republican behind this bill, and he says that small businesses need this help ASAP.

So what this bill would do is it would eliminate that 75/25 split that's currently required. It makes businesses put 75% of the loan toward payroll. It would also give businesses 24 weeks to spend the money instead of 8, and it would eliminate the two-year loan terms, and it would extend the rehiring deadline that is in place right now.

Roy worked with Democratic congressman Dean Phillips on this, and he says that he's optimistic it will pass the House. And he hopes this legislation could be kind of a blueprint for lawmakers as they work on further relief efforts. Let's listen.

CHIP ROY: These large bills, they're really cumbersome. Let's get together and let's move 4 or 5 or 10 bills that focus on discrete problems. Let's make them work well, and then let's do the deliberative process of amending and getting it through. And I hope this is a new model, and working with Dean Phillips, I hope we will get that through.

JESSICA SMITH: --what happens on the Senate side if the House does pass this next week. Some senators were trying to pass a more narrow bill yesterday to just give businesses more time to spend the money, but they ended up not even considering that yesterday, and now they're on recess until June 1. It's possible that they could consider something in a pro forma session at some point next week, but that's still up in the air right now. We'll keep you updated. Zack.

ZACK GUZMAN: All right, Jessica Smith bringing us the latest from Washington, DC. Appreciate that.