PROVIDENCE, RI -- After hearing from frustrated small businesses who have applied and been approved to receive federal aid, but have yet to receive any funding, U.S. Senator Jack Reed is urging the Trump Administration to prioritize small businesses and streamline the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan program (EIDL) process.  He is also urging Congress to quickly and unanimously pass bipartisan legislative fixes to the CARES Act and provide an additional $250 billion for PPP and $50 billion for EIDL, along with $15 billion for disaster grants to ensure small businesses can access the direct financial support they need.

 The Trump Administration is now claiming it has exhausted the pool of PPP funds, despite the fact that the vast majority of small businesses have been unable to actually access any of the money they were approved for.

Senator Reed criticized the Trump Administration’s mismanagement of small business programs and lack of clear communication as factors that are preventing eligible small businesses from accessing the funds they deserve.  Reed also urged President Trump to go to bat for small businesses the same way he has personally stepped in to help celebrities, friends, and former contestants on his TV shows.

“Small businesses owners have every right to be upset.  They did their part, got all the paperwork in order, filled out applications, and got approved.  But instead of quickly distributing the money, the Trump Administration is leaving small businesses in the lurch.  EIDL funds that were supposed to be out the door in three days have been withheld for weeks without clear answers.  I have sought to help small business owners navigate obstacles and advised folks to be patient, but the Trump Administration needs to be accountable for their missteps and mismanagement,” said Senator Reed.  “The CARES Act provided a clear mandate and resources to help small businesses.   Instead of faithfully executing the law and distributing the funds as intended, the Trump Administration issued rules and bureaucratic red tape that is hindering workers and businesses.  Congress should quickly pass a law to improve and expand PPP and EIDL and the Trump Administration should get to work getting the funds out the door. Sadly, the current Republican proposal is to just pour more money into a system that isn’t working properly and needs fixes as well as funding.”

Last month, the U.S Senate unanimously approved the $2.2 trillion federal Coronavirus Aid, Relief, and Economic Security (CARES) Act to help combat the novel coronavirus (COVID-19) pandemic, protect public health, and the health of our economy.  PPP and EIDL were two key loan and grant components of the law which provides over $377 billion in targeted assistance for small businesses nationwide.

While the U.S. Small Business Administrator promotes statistics that $1.2 billion in federal Paycheck Protection Program funding has been approved for 6,100 Rhode Island businesses, the agency refuses to say how much cash has actually gone out the door and businesses are complaining they have yet to see a dime.  And another small business emergency assistance program, the Economic Injury Disaster Loan program, which Congress designed to provide emergency bridge loans and grants of up to $10,000 to small businesses within three days of applying for a loan has been overwhelmed, and Trump Administration officials have failed to offer guidance or deploy funding that was supposed to go to small businesses.

“People who invested their entire lives building up small businesses are watching them slowly collapse while Trump Administration officials struggle to issue clear guidance.  Congress needs to step in with bipartisan legislative fixes before it is too late,” said Reed.  “Democrats want to get the money out the door, fix the program, and replenish depleted funds.  Congressional Republicans should stop blocking bipartisan and comprehensive help for small businesses.”

Reed says changes to the law are needed to:

•  Ensure applications are correctly processed in a timely manner;

•  Create more transparency around how many PPP and EIDL loans applications have been received, processed, and disbursed;

•  Allow small businesses that are served by smaller financial institutions, not just big banks, can to access the funds;

•  Ensure that all eligible small businesses, including minority-owned, women-owned, and veteran-owned small businesses, can access critical funding and are not turned away by banks;

•  Extend the time frame eligible businesses can receive funding beyond eight weeks and make the re-hiring requirements for loan forgiveness more flexible to assist restaurants and hospitality industry;

•  Ensure that other categories of small businesses and non-profits the law was intended to help, including health centers, are fully eligible to access benefits; and

•  Provide additional funding for PPP, EIDL, and other small business aid.

Additionally, Senator Reed joined U.S. Senator Ron Wyden (D-OR) in urging SBA to ensure small businesses receive the new Emergency Economic Injury Grants (EEIGs) within three days of application as required by Congress.  The Senators sent the letter following reports that small businesses across the country are not receiving EEIG advances, despite the fact that they are eligible entities and have taken the necessary steps of applying for an Economic Injury Disaster Loan (EIDL) and requesting an EEIG.  The Senators also asked the SBA to clarify whether small businesses who applied for an EIDL prior to March 27, 2020, when the CARES Act was signed into law, must now reapply in order to receive it and the EEIG, and if the SBA requires additional action or resources from Congress to be able to fully execute the small business relief provisions of the CARES Act.

"Small businesses across the country are counting on this federally-mandated relief, and it is imperative that the SBA ensure they receive it efficiently and effectively," the Senators wrote. "Businesses are receiving conflicting guidance on the expected timing for receiving these critical funds, and many businesses cannot afford to wait as they try to keep their employees on payroll and pay their rent."