Newly released video spotlights small business plight after delays and lack of funding
WASHINGTON, D.C. (April 29, 2020) – The National Federation of Independent Business (NFIB), the nation’s leading small business advocacy organization, sent a letter to Small Business Administration Administrator Jovita Carranza on behalf of NFIB President Brad Close. The letter urges that returned and prepaid Paycheck Protection Program (PPP) loans be made available to small business owners who have yet to receive a PPP loan.
“NFIB requests the SBA make available both returned PPP loans and prepaid disbursements to small business owners who have not yet received one. According to the SBA, more than $2 billion in funds have been declined and returned and will be made available during the current application period, another development for small business owners,” said Close.
NFIB also released a video of small business owners telling their struggles, firsthand, of what they’ve experienced as they sought funds only to see them dry up and go to large, publicly traded companies. “They deserve better this time around,” the video concludes.
Published reports showed that at least $870 million in PPP loans went to large, publicly traded companies. According to NFIB research, these funds could cover, for example, nearly 30,000 small businesses with five employees and average salaries of $65,000 per employee, small businesses that have no other options for financial assistance.
The full letter to Administrator Carranza is below and found here.
The new video can be found here.
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Dear Administrator Carranza,
On behalf of NFIB, the nation’s leading small business advocacy organization, I write to request that the Small Business Administration (SBA) ensure that Paycheck Protection Program (PPP) funds that have been returned and prepaid be made available for additional PPP forgivable loans.
A recent NFIB Research Center survey showed that 74% of small business owners (and nearly all small business owners with employees) had applied for PPP forgivable loans as of April 17, 2020. The same survey found that only 20% of applicants had received disbursements. Nearly 80% of small business owners were still waiting and many did not know where they stood in the process. Demand remains high and many small business owners who are relying on this funding remain in limbo.
Meanwhile, widespread media reports indicate that large businesses and publicly traded companies have received significant PPP loans. SBA and Treasury issued a Frequently Asked Question (FAQ #31) encouraging publicly traded companies that have access to other lending resources to return PPP loans by May 7, 2020. This guidance was a positive development for small business owners.
In response to the FAQ, the National Association of Government Guaranteed Lenders reminded lender members that disbursed PPP loans cannot be returned to circulation, “If a loan has been disbursed and must be repaid based on this FAQ those funds will be lost to the program and will not benefit other borrowers.” It is clear that loans that have been cancelled and not disbursed will be recirculated. It is unclear whether funds that have been disbursed and prepaid will be recirculated.
NFIB requests the SBA make available both returned PPP loans and prepaid disbursements to small business owners who have not yet received one. According to the SBA, more than $2 billion in funds have been declined and returned and will be made available during the current application period, another development for small business owners. According to NFIB research, these funds could cover, for example, nearly 30,000 small businesses with five employees and average salaries of $65,000 per employee, small businesses that have no other options for financial assistance.
The PPP is an essential forgivable lending arrangement for small businesses during this unprecedented public health and economic crisis. The additional appropriations from the Paycheck Protection Program and Health Care Enhancement Act will help more small businesses but so will those loan amounts that are returned or prepaid if those funds are recycled into new loans. Thank you for leadership during these difficult times.
Sincerely,
Brad Close
President
NFIB
