Spanberger: SBA must stand Up for Main Street in PPP implementation
The Paycheck Protection Program and Health Care Enhancement Act includes $60 billion in PPP funding set aside for Community Development Financial Institutions, small and medium-sized banks, and credit unions. However, many small financial institutions are currently struggling to implement the PPP, particularly those located in rural areas.
In a letter sent to SBA Administrator Jovita Carranza, Spanberger and 20 of her colleagues urged the SBA to release data collected from the first wave of PPP applications, so that Members of Congress can better allocate adequate amounts of funding to the these areas, ensure proper oversight of the program, and prevent publicly-traded corporations from siphoning much-needed small business assistance.
“Seeing which loans were applied for and left unfunded can help us as Members of Congress better allocate adequate amounts of funding,” said Spanberger and her colleagues. “The State by State breakdown has been informative, nonetheless we need data for which PPP funds that were allocated to larger loans so we can work hard to ensure that Congress is prioritizing sole-proprietors, contractors and ‘mom and pop’ small businesses. These businesses are the backbone of America. We are fully committed to working with you to implement these recommendations so these funds can reach those who are the most in need.”
In their bipartisan letter, the lawmakers also pushed the SBA to develop clear and concise instructions for accessing SBA loan programs, especially for non-SBA lenders trying to process loans. Additionally, the Democrats and Republicans pressed the SBA to allocate at least 25 percent of PPP funds toward institutions like community banks, credit unions, and CDFIs of $50 billion in asset size or less.
The letter continues, “We ask you allocate at least 25 percent of PPP funds for institutions, like community banks, credit unions, and Community Development Financial Institutions (CDFIs), of $50 billion in asset size or less. To ensure PPP access to all communities and regions of the nation, we must not allow PPP funds to be used near exclusively by the largest banks. Because the largest banks often do not serve America’s smaller, rural communities, it would be a costly policy mistake to allow these lenders to soak up a disproportionate share of the funding. To ensure a robust recovery, funding must be distributed fairly and evenly with no communities left behind. Recognizing this issue, Congress recently acted to set aside $60 billion of the $310 billion added to the PPP program for these smaller institutions. We ask you continue to further this goal.”