Photo: Congressman Dwight Evans (PA-03), vice chair of the House Small Business Committee
Congressman Dan Kildee (MI-05), chief deputy whip of the House Democratic Caucus, wrote a letter, along with Congressman Dwight Evans (PA-03), vice chair of the House Small Business Committee, to request that additional emergency aid is made available to small businesses in underserved communities, especially those owned by veterans, women, people of color and farmers.
The letter, sent to Republican and Democratic leaders in Congress, requests that any additional coronavirus emergency aid bills prioritize aid, through the newly-created Paycheck Protection Program (PPP), for underserved communities. Additionally, the letter requests a portion of the PPP funding be set aside for smaller community lenders, such as credit unions and Community Development Financial Institutions (CDFIs).
The letter reads in part: “We are asking congressional leadership to mandate that lenders prioritize PPP loans for small businesses owned by minorities, women, veterans, and those in underserved and rural markets in the next stimulus package. We are also asking that leadership set aside part of the PPP funding for smaller community lenders, such as credit unions and CDFIs. Small businesses are the backbone of the economy. They make up ninety-nine percent of businesses in America. It is essential that we support and protect the most vulnerable businesses during the COVID-19 pandemic.”
The letter also said since the rollout of PPP on April 3, small businesses have complained of being unable to access applications. In addition, it points out the CARES Act provided that the SBA “administrator should provide guidance to [PPP] lenders and agents to ensure that the processing and disbursement of covered loans prioritizes small business concerns and entities in underserved and rural markets, including businesses in operation for less than 2 years.
The PPP was included in the Coronavirus Aid, Relief and Economic Security (CARES) Act, which authorized up to $349 billion in loans for small businesses in order to continue to pay up to eight weeks of their employees’ salaries during the coronavirus crisis. The loan amounts can be forgiven as long as 75% of the loan is used to cover payroll costs with the remainder used for mortgage interest, rent and utility costs. Forgiveness also requires employee numbers and compensation levels stay the same.
