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Stimulus Listening Session Recap

We had a really insightful listening session on Tuesday with Matt Gomez, Banking Counsel for Chairwoman Nydia M. Velázquez, House Committee on Small Business.  He was very generous with his time and knowledge. Here’s recap of what he talked about:

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Paycheck Protection Program

  • The bill expands eligibility to nonprofits with up to 500 employees (from 300 previously). This will potentially benefit many organizations with which our members partner.
  • The bill also expands eligibility to web-based publishing organizations, such as local news websites which are often the only source of news for small communities and rural areas.
  • The program is extended for an additional three months through a bipartisan agreement that included Rep. Young Kim of California. The application deadline is extended by two months to May 31st, and an additional month will be dedicated for lenders and SBA to review and process all applications that are submitted before the deadline. This modification was created in response to PPP fatigue from big lenders, in the hopes that it will curb their reticence to help applicants with the loan forgiveness process. Some of the larger banks have been slow with the forgiveness process.

EIDL Program

  • The bill increases funding by $15 billion for additional advance payments to eligible entities under the SBA’s Economic Injury Disaster Loan (EIDL) program. 
  • SBA is currently reaching out to previous recipients of EIDL advances who received less than what they were eligible for (up to $10,000) due to the employee cap rule which disadvantaged many self-employed workers and independent contractors. For example, if a small business only received a $4,000 EIDL advance, they will be contacted for eligibility for another $6,000. 
  • The EIDL advance payments are available only to small businesses in census identified low-income areas.

Per Congressional intent, the PPP and EIDL programs were rolled out really quickly. Unfortunately, unscrupulous entities took advantage which led to fraud.  A new report by the SBA found that duplicate loans using the same tax identification numbers, business names, and addresses, were disbursed for a total of $692 million between April and August of 2020

Grant Programs for Restaurants and Shuttered Venues

  • The House Committee on Small Business is working with SBA on the Shuttered Venue Operators Grant, which was established by the Economic Aid Act and amended by the American Rescue Plan Act. The program includes over $16 billion in grants to shuttered venues, to be administered by SBA’s Office of Disaster Assistance. This is a first-of-its-kind program for SBA and will take some time to  roll out.
  • The bill will provides $28.6 billion for a Restaurant Revitalization Fund to be administered by the SBA. The program likely will roll out soon after the Shuttered Venues program.

Community Navigator Program

  • The Committee is also working with SBA on the Community Navigator Pilot Program, another brand new program that would engage community organizations to conduct targeted outreach in minority, rural, and other under-engaged communities.

Responsible Business Lending

  • The Committee is currently working on a federal truth-in-lending bill in the same vein of legislation that has already passed in California and New York. However, the Small Business Committee does not have primary jurisdiction on this bill and must work together with the Committee on Financial Services in order to pass it. 

Congress made historical investments in small businesses and their ecosystem. Grants for small businesses were unheard of a year ago. We used to have to knock on door after door after door after door to bring attention to the importance of small businesses. We’re grateful that the message finally has been heard.