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Another round of federal loan help for small businesses could be taken up by Congress in the next couple of weeks, a representative for Sen. Susan Collins told a state economic recovery panel on tourism Wednesday.
“There is a pretty strong likelihood” that Congress will pass a third loan program designed for businesses that have already gotten federal loans, Carol Woodcock, a state office representative for the Republican senator, told a subcommittee of a panel convened by Gov. Janet Mills to guide the state’s economic response to the virus.
“It’s possible in a couple of weeks that we’ll have the answer as to whether that program will be available,” Woodcock said.
Companies that have gotten forgivable loans under the Paycheck Protection Program, which has provided $2.2 billion in loans to Maine businesses, cannot apply for another one. Collins has proposed another round of loans for hard-hit businesses that have already gotten loans and have 300 or fewer employees, while expanding forgiveness provisions to include facility modifications and protective equipment.
Woodcock said the proposal has strong support and will be taken up by Congress when it returns from recess. Her comments come one week after the Economic Recovery Committee warned the Democratic governor in a letter that federal aid programs are about to expire and represent “an economic cliff for our state, and nation.”
“Unless further stimulus emerges at the federal level the effect on our state’s people and businesses will be devastating,” it said.
The tourism subcommittee met Wednesday ahead of a noon deadline to get early recommendations to the full economic recovery committee on how to jumpstart the economy. One of the main discussion topics was whether the $300 million in economic relief sought in a draft plan for small businesses under the allotted federal coronavirus funds would be enough.
“The $300 million is not adequate,” said Curtis Picard, a committee member and president and CEO of the retail association of Maine.
A group of hospitality and retail interests has asked Mills for $800 million to help the industry stay afloat, and the committee agreed that number is more accurate in terms of need.
Adam Lee, board chair of Lee Auto Malls and a committee member, said the committee should put forward the entire need of $800 million, but expect to get less and come up with a plan for the lesser amount.
The $300 million in proposed grants would be divided into $200 million for small businesses and nonprofits with fewer than 50 employees or with revenues of less than $5 million, with individual awards capped at $50,000. Another $100,000 would go to for-profit businesses and nonprofits with 50 or more employees and revenues of $5 million or higher, with awards capped at $200,000.
Picard said there are 12,000 businesses just in the tourism industry, and $200 million translates into only 4,000 businesses getting $50,000 each.
“This is to get us to the next federal program,” said Bob Montgomery-Rice, president and CEO of Bangor Savings Bank and a committee member, likening it to continuing to put in oil to keep a car running.