Senate votes to extend small biz loan program for 2 months
WASHINGTON โ The Senate passed a bill 92-7 on Thursday to extend the deadline for business owners to apply for forgivable loans through the Paycheck Protection Program, giving applicants two more months to apply for federal aid. The bill had already passed the House, so it now goes to President Joe Bidenโs desk to be signed into law. Congress started the loan program last year to help businesses survive the COVID-19 pandemic. Business groups lobbied lawmakers to keep the program going to help ensure businesses that still need help can get it. The Small Business Administration reports that it has approved nearly 7.9 million loans totaling about $704 billion.
Senate confirms Isabel Guzman to lead small biz agency
(AP Photo/Alex Brandon)WASHINGTON โ The Senate on Tuesday overwhelmingly approved President Joe Biden's pick to oversee the Small Business Administration, an agency that has seen its portfolio expand in response to the coronavirus pandemic. Guzman is a former Obama administration SBA official who currently heads Californiaโs Office of the Small Business Advocate. In that role, she oversaw efforts to help that stateโs small businesses survive the pandemic. The Small Business Administration oversees loan programs to help businesses recover from natural disasters, enhances access to capital through loan guarantees and provides training and technical assistance. Guzman said she would work to ensure money gets into the hands of the small businesses hurt the most by the pandemic and the economic crisis through no fault of their own.
More coronavirus relief on the way for small businesses
(AP Photo/Jae C. Hong, file)NEW YORK โ For Nancy Sinoway, a second coronavirus relief loan would increase the chances that her dressmaking business will survive. The SBA will initially accept only applications submitted by community financial institutions, or CFIs, lenders whose customers are minority-owned and economically disadvantaged businesses. Starting Monday, applications for first-time borrowers submitted by these lenders will be accepted, followed by applications for second loans on Wednesday. As with the first two rounds of the PPP, applications must be submitted online at banks and other SBA-approved lenders. The PPP loan Sheets got in the spring helped tide him over.
Minority-owned companies waited months for loans, data shows
Congress has approved a third, $284 billion round of PPP loans. The recent data from the SBA provided a more in-depth look at businesses that received loans than data released on July 6. The AP and other news organizations successfully sued under the Freedom of Information Act to make data on all PPP loans public, leading to the latest release. The SBA did not address the timing of loans to minority-owned businesses when asked for comment by the AP. MBE Capital, a lender focusing on minority-owned companies, received a commitment in mid-May from NBA Hall of Fame member Magic Johnson for funding for $100 million in PPP loans.
Joel Osteenโs Houston megachurch defends getting $4.4 million in federal PPP loans
HOUSTON โ Joel Osteen, the pastor at Lakewood Church in Houston, has come under fire in recent days after Houston Chronicle reported that the megachurch received $4.4 million in PPP loans from the Small Business Administration (SBA). Federal Paycheck Protection Program Loan data provided by the Small Business Administration (SBA) indicates that the loan given to Lakewood Church is the third-largest for any Houston-area business or nonprofit. The data shows that Lakewood Church applied for the loan on July 21 and that 368 jobs would be affected by the loan. In order to have the loan fully forgiven, the PPP loan must be used for payroll costs, interest on mortgages, rent and utilities. Osteenโs Lakewood Church and other megachurches have been criticized by some for taking part in the federal recovery program because of their tax-exempt status.
Size mattered: Big companies got coronavirus loans first
The PPP made very low-interest loans available to any business -- or any franchisee of a business -- with under 500 employees. It was not designed for very small businesses.Its not clear how many small companies have failed because of the pandemic. The data released by the SBA July 6 does show that by June 30, 85% of the PPP loans had been for less than $150,000. Among other big banks, nearly 18% of the 1,185 loans TD Bank made the first week were over $1 million, as were 13% of Truists 7,143 loans. But it may have been too late for who knows how many small businesses, said Karen Kerrigan, president of the advocacy group Small Business & Entrepreneurship Council.
House demands coronavirus loan info from Treasury, banks
WASHINGTON A House subcommittee investigating billions of dollars in coronavirus aid is demanding that the Treasury Department, the Small Business Administration and several large banks turn over detailed information about which businesses applied for and received federal loans. The letters ask the banks and the department for a complete list of applicants for loans, whether they were approved and also details on the guidance Treasury has issued. Democrats say they are not receiving enough information about the loan disbursements and fear the Treasury Department has favored large, well-funded companies over smaller businesses in underserved communities. The agency has only provided general information, such as the total amounts of loans awarded in a given time period. The loans can be forgiven if businesses use the money to keep employees on payroll or rehire workers who have been laid off.
Treasury chief refusing to disclose recipients of virus aid
(Al Drago/Pool via AP)WASHINGTON Building ramparts of secrecy around a $600 billion-plus coronavirus aid program for small businesses, Treasury Secretary Steven Mnuchin has moved from delay to denial in refusing outright to disclose the recipients of taxpayer-funded loans. We believe that thats proprietary information, and in many cases, for sole proprietors and small businesses, is confidential information, Mnuchin said during the hearing by the Senate Small Business Committee. Mnuchin promised in his testimony to give the GAO access to the PPP loan data. Mnuchin's pledge to give the GAO's auditors access to the PPP loan data appeared to satisfy some senators, who didnt press him on public release of the information. Praise for the small-business loan program flowed to Mnuchin and Carranza at the hearing from senators from both parties, who cited the positive economic impact across the country.
Treasury chief refusing to disclose recipients of virus aid
(Al Drago/Pool via AP)WASHINGTON Building ramparts of secrecy around a $600 billion-plus coronavirus aid program for small businesses, Treasury Secretary Steven Mnuchin has moved from delay to denial in refusing outright to disclose the recipients of taxpayer-funded loans. About 10 weeks after the program was launched, the SBA says it has processed 4.5 million loans worth $511 billion. While the SBA administers the program, Mnuchins Treasury Department has ultimate control over it. We believe that thats proprietary information, and in many cases, for sole proprietors and small businesses, is confidential information, Mnuchin said during the hearing by the Senate Small Business Committee. Praise for the small-business loan program flowed to Mnuchin and Carranza at the hearing from senators from both parties, who cited the positive economic impact across the country.
SBA leaves businesses still hoping for more leeway on loans
NEW YORK Small businesses hoping for more leeway in using coronavirus loan money were disappointed as the government released instructions for seeking forgiveness for the loans. According to the instructions, loans can still be forgiven in full only if the money is spent within eight weeks of receiving it. Many small businesses say the eight-week period is too restrictive; loan forgiveness applies only for money spent through June 30. Loan forgiveness was a key factor in many owners seeking the loans. While technically they can do that, they could not get forgiveness on the money spent for unapproved items.
Who got what? Details scant on small-business relief effort
WASHINGTON A small, overlooked federal agency is shouldering a massive relief effort for the nations small businesses and their workers left reeling by the pandemic. The need for a detailed public accounting of the small-business relief program is amplified by controversy over how it has unfolded since early April. The agency recognizes the need to balance the interests of transparency with the privacy and confidentiality issues release of loan information raises." The SBA did not make the information public. Under the program, companies are required to use the funds exclusively for employee salaries.
'Absolute chaos' as businesses try to tap into rescue funds
NEW YORK โ Desperate small business owners who hoped for a quick government lifeline to help them survive the coronavirus crisis are still without funds, instead battling red tape, wary banks and swamped computer systems. Thousands of owners who applied for loans under the government's Paycheck Protection Program are in their second week of waiting for their money. And thousands who sought relief through Small Business Administration economic injury disaster loans have waited even longer โ some since mid-March. โItโs been absolute chaos, and we havenโt even gotten to the point where the program is fully open yet,โ said Jack Heath, president of Washington Trust. Small business owners have also found the economic injury disaster loans problematic.
Urgent question from small businesses: When will aid arrive?
That's the urgent question for small business owners who have been devastated by the coronavirus outbreak. โRelief canโt come soon enough โ weโre a cash business with small margins," says Rammel, who is looking to Small Business Administration loans. The rescue package signed into law Friday provides for Small Business Administration loans to companies as well as to sole proprietors and freelancers. And the Federal Reserve plans to set up a program to lend directly to small business owners. On its face, the rescue aid appears to address some of the most vital needs of small businesses, notably their ability to maintain or hire back furloughed workers eventually.