Small-business owners won’t have to pay back their federal pandemic relief loans even if they don’t rehire all of the workers they laid off, the Trump administration affirmed, effectively eliminating a rule that many borrowers had feared would leave them stuck with a large debt, the New York Times reported. Congress appeared to relax that requirement this month with a new law that loosened many terms of the Paycheck Protection Program, a $660 billion relief effort intended to help struggling small companies retain or rehire their workers. But the final say on how the law would be interpreted rested with the Treasury Department, which has called the shots on most aspects of the relief effort. The Treasury Department and the Small Business Administration, the program’s manager, released new loan forgiveness forms that slashed documentation requirements and will give many borrowers an easy pathway to having their debt eliminated. The forms added a “safe harbor” option that allows borrowers to simply affirm they were unable to operate “at the same level of business activity” they had before the crisis because of government requirements or safety guidance, including social distancing rules. Those borrowers can have their loans fully forgiven if they meet the program’s other rules, including a requirement that they spend at least 60 percent of their aid money on payroll.
