CNMI businesses that failed to get their loans approved under the initial Paycheck Protection Program will get another chance at receiving financial assistance through a new bill passed by U.S. House of Representatives.
The Paycheck Protection Program and Health Care Enhancement Act now goes to the White House for the President Trump’s signature.
Rep. Gregorio Kilili Camacho Sablan, the CNMI's delegate to the U.S Congress, said the popular Payroll Protection Program that allows small businesses and non-profits to keep paying staff was replenished with $310 billion. An initial $349 billion for the PPP in last month’s Coronavirus Aid, Relief, and Economic Security, or “CARES,” Act was completely used by April 16.
“56 applicants in the Marianas were awarded loans worth $12.6 million in the first round, but other Marianas applicants were turned away because funds were exhausted,” Sablan said. “Now there is a second chance, but act quickly.”
Three lenders in the CNMI are participating in the program—Bank of Hawai’i, Bank of Guam, and First Hawaiian Bank—according to the U.S. Small Business Administration.
Businesses that receive the 1 percent loans must repay them within 2 years. The loans will be completely forgiven, however, if an employer uses the money to keep or quickly rehire employees at their current wage. Up to 25 percent of the loans may also be used for rent, utilities, and other business costs.
Sablan said he would be posting the PPP borrower application form at his office website, http://sablan.house.gov, and on his social media pages. “This will allow potential borrowers to see exactly what information will be requested when they go to the
bank to apply for a Paycheck Protection Program loan.”
Several weeks ago, Republicans and the Trump administration proposed adding $250 billion to the popular program, but Democrats held out for an additional $60 billion for emergency business grants and loans and for a set-aside of $60 billion for lenders serving smaller communities.
“That could improve the odds for Marianas businesses and non-profits,” Sablan said.
In the first round of the Paycheck Protection Program 508 organizations on Guam were able to borrow $102.4 million. In Hawai’i 11,553 businesses and non-profits borrowed over $2 billion.
The bill the House passed Thursday also added $100 billion for healthcare to the original Republican proposal. Democrats secured $75 billion to get Personal Protective Equipment and other resources to frontline healthcare workers, hospitals and community health centers.
Democrats also added $25 billion for testing, which experts say is the key to reopening the economy. And Democrats got Trump administration negotiators to agree to a national strategic testing policy that will focus on increasing testing capacity, including testing supplies, nationwide. Twenty-one days after enactment of today’s bill, the administration will be required to report on coronavirus testing with data on demographic characteristics including race, ethnicity and geographic regions. The report will also include numbers and rates of cases, hospitalizations, and deaths as a result of the virus.
“The key to reopening the economy and helping us all feel safe again is testing,” said Kilili. “South Korea, Taiwan, and Germany have shown that widespread testing can give confidence that the disease is receding and can alert health officials when the disease recurs.”
House leaders are also looking ahead to the next coronavirus relief legislation, what is being called CARES II. They had wanted to include more direct funding to state and territorial governments, but the Trump administration refused. The President has acknowledged the need, however, and agreed to consider this critical priority in CARES II.
“We need to make sure that state and territory governments have enough money to pay doctors and nurses, police, fire, teachers, and other vital workers and meet other critical obligations, like retirees,” Sablan said.
Earlier this week, CNMI Gov. Ralph Torres announced more than $4 million in technical assistance for the commonwealth's Covid-19 response under the CARES Act.
Additional Technical Assistance Program funding has been made available to states, territories and freely associated states through the U.S. Office of Insular Affairs.
“Our main priority since the beginning of this pandemic has been to stop the spread of this virus on our islands. With the help of our federal partners, we have been able to establish multiple quarantine sites and set up a field hospital to assist with prevention and response efforts to Covid-19," Torres said. "This additional funding will allow us to further our efforts to contain this virus and keep our people safe. Lt. Governor Palacios and I would like to thank Assistant Secretary Domenech, OIA, and all of our federal partners for their continued support in our community’s fight against Covid-19."