Madam President, earlier this afternoon, I convened a meeting of the Small Business and Entrepreneurship Committee as its chairman. We had noted an agenda to act on the nomination of Dilawar Syed to be the Deputy Administrator of the Small…
Madam President, earlier this afternoon, I convened a meeting of the Small Business and Entrepreneurship Committee as its chairman. We had noted an agenda to act on the nomination of Dilawar Syed to be the Deputy Administrator of the Small Business Administration.
This was not our first attempt, and I am going to outline all the efforts that we have made to get a vote on Mr. Syed. But to my disappointment, the Democrats were there ready to vote on the nomination.
We also had two important pieces of legislation that we were scheduled to vote on, and every Republican refused to show up, denying us a quorum to be able to conduct business.
Let me share with my colleagues the state of play on this individual and on this nomination. President Biden nominated Dilawar Syed to be the Deputy Administrator of the Small Business Administration on March 3. He is a well-qualified entrepreneur and a small business advocate.
After reviewing his paperwork and ethics agreement, the committee held a hearing on Mr. Syed's nomination on April 21. Now, during that hearing, Ranking Member Paul raised serious concerns about PPP and Economic Injury Disaster Loan--EIDL--received by Lumiata, a tech company from which Mr. Syed serves as the CEO. After weeks of negotiations, I brokered a compromise between Ranking Member Paul and the SBA that provided access to the company's loan applications.
On June 8, I personally sat down with Ranking Member Paul and a representative of the Small Business Administration outside the Senate Chamber to review those documents and ensure that the loans were properly attained, which they clearly were. The
following day, the documents were made available to all of the committee members on the Small Business Committee.
Now, what that record showed is that those loans were taken out in regular order, that they were entitled to the PPP loan and the EIDL. But it also showed something that was quite remarkable. Mr. Syed returned the PPP loan without forgiveness. He was entitled to forgiveness, but, as he said, he was able to get access to additional capital and didn't need the government help and thought it was the right thing to return the loan without forgiveness. What exemplary action.
Satisfied that we had resolved the issue, Senator Paul agreed to my request that the committee schedule a vote to report out the nominee on June 16. After achieving a quorum of Senators, I moved to report the nomination by voice vote, as requested--a common practice in the Senate. A few Republican members asked to be recorded as voting no, which is also a common practice in the Senate.
However, we were later informed by the Senate Parliamentarian that the nomination could not be reported to the full Senate because a Republican staff member raised an objection that there had not been a rollcall vote in our committee.
A new objection was then raised based on Mr. Syed's involvement in Emgage, a nonprofit organization that supports the Muslim-American community. One Republican office even circulated an email that focused on Mr. Syed's Muslim religion and place of birth.
Two weeks after the meeting, on June 30, I received a letter from eight Republican members suggesting that Mr. Syed's involvement in Emgage was evidence of an Israel bias and support for Boycott, Divestment, and Sanction movement--the BDS movement. This is 2 weeks after we have already had our first committee vote.
Mr. Syed had a relationship with this company, and this company had no record of this type of bias. Mr. Syed responded to these concerns in a letter that he stated he is ``a proud first-generation Muslim- American but also pro-Israel.''
He clearly stated that he does not support the BDS movement and believes ``Israel to be a major partner in supporting the growth of America's innovative small businesses.''
Several Jewish organizations have come to Mr. Syed's defense. For example, the American Jewish Committee wrote:
The unsupported accusation that somehow Jewish businesses
are those with ties to Israel may not fare as well under Mr.
Syed's leadership in the Small Business Administration . . .
has no factual grounding. Indeed, he has specifically
disavowed support for the . . . (BDS) movement. . . . AJC
rejects the charge that simply an affiliation with Emgage
would reflect negatively on an individual, organization, or
agency.
And AJC went even further and called the Republican accusations against Mr. Syed ``un-American.''
On Thursday, July 15, the committee again attempted to hold a business meeting to report out the nomination.
We thought we had resolved all the issues. We resolved the issues concerning the loans. Everybody agreed they were proper. There was no concern about Mr. Syed's views in regards to Israel. That had been resolved.
So, Mr. President, I was puzzled that, on the July 15 meeting, all 10 Republican members boycotted the meeting and a reporting quorum was not achieved. We couldn't take action. I couldn't understand why because we had resolved the two issues--the first issue, and then it changed to a second issue.
But it was not until a week later that committee Republicans changed course again and developed a new line of attack, this time linking the nomination to PPP loans received by entities of Planned Parenthood.
On July 22, all 10 committee Republicans released the following statement:
The SBA has wrongfully approved nearly $100 million in
taxpayer-funded Paycheck Protection Program loans to Planned
Parenthood branches across the country. On June 30th alone,
SBA approved four PPP loans to Planned Parenthood affiliates
despite a determination from the last Administration that
these entities were ineligible for the program. We will not
allow a vote on this nominee until the SBA takes action to
recover the wrongfully acquired PPP funds by Planned
Parenthood entities.
Mr. President, I am going to go through in detail as to how these loans were not improperly given and that the ground rules we set up were followed by Planned Parenthood and other nonprofits of similar type of organization.
Where they came up with this line is still somewhat of a puzzlement to me since my Republican colleagues were engaged with us in developing the PPP program and the eligibilities for the PPP program.
Since that date, I have tried several times to hold business meetings to report out the nomination, but Republicans would not attend markups that I attempted to hold on September 21, November 4, and again today. On September 29, I attempted to discharge Mr. Syed's nomination from the committee by unanimous consent--that is after our voice vote that had already approved his nomination--but Ranking Member Paul objected to my request on the Senate floor.
The Planned Parenthood issue predates the Syed nomination and even the Biden administration. It goes back to March of 2020 when this committee took the lead--the Small Business Committee took the lead in drafting the bipartisan CARES Act.
I was proud to be part of a team that includes Senator Shaheen, Senator Rubio, and Senator Collins. We sat down and went line by line drafting the PPP legislation that we are talking about. We negotiated back and forth in good faith on the provisions of this bill. It was truly a bipartisan effort.
Republicans controlled the Senate. We worked with the Republicans, and we came up with a bipartisan bill to help America's small businesses. That legislation made 501(c)(3)s--nonprofits--and veteran nonprofit organizations with up to 500 employees eligible for the PPP loans. This was a mutual decision. We knew it had some controversy associated with it. There are faith-based groups that people have some concern about getting government support. There are different organizations that people might have a concern. But we felt that during this pandemic, it was important to preserve our small business entities, whether they were for-profit or nonprofit, and that was a bipartisan decision that was made by Democrats and Republicans.
During the negotiations of March 2020, then-Chairman Rubio added language to an early draft that would have prohibited nonprofit entities that receive Medicaid assistance from getting PPP loans. This was presumably an effort to deny Planned Parenthood the opportunity to participate in the program. But because of the way it was drafted, it also affected a lot of nonprofits. It affected programs such as domestic abuse centers or homes for the disabled. It was soundly rejected in our group as not being a workable restriction, that we could not support that type of prohibition.
So we negotiated back and forth, and we could not resolve the issue. Eventually this issue, along with other issues that we couldn't resolve, was taken up to the joint leadership of the Senate Republicans and Democrats who were trying to resolve issues that we couldn't resolve in our committee deliberations. It was at that level that a compromise was reached to add language that applied the SBA affiliation rules to nonprofits--not the Medicaid language but the affiliate rules. We had no objection to that. We felt that nonprofits should be subject to the same restrictions as for-profit entities as far as whether they were truly independent or part of just a national group, whether there was control on the affiliate. So we thought that made sense.
In April of 2020, the SBA, under the Trump administration, released guidance on applying the affiliation standards to nonprofits, which is where we are getting to the determinations made by Planned Parenthood.
The part of the affiliation that applies to nonprofits relates to common management. I am going to quote for the Record. I have the full statement here of what the affiliate rules were, but let me just read into the Record the relevant section that applies to the controversies--I don't think it is controversies--the Republican controversy on Planned Parenthood.
Affiliation arises where the CEO or President of the
applicant concern (or other officers, managing members, or
partners who
control the management of the concern) also controls the
management of one or more other concerns. Affiliation also
arises where a single individual, concern, or entity that
controls the Board of Directors or management of one concern
also controls the Board of Directors or management of one
[or] more other concerns. Affiliation also arises where a
single individual, concern or entity controls the management
of the applicant concern through a management agreement.
Now, the question is, Does the national group control the personnel and board of the affiliate? That is how the rules apply.
Planned Parenthood of America determined its entities were eligible because it does not exercise control over its member organizations and does not have a common management. Each member organization is its own independent, not-for-profit, tax-exempt organization with its own independent board of directors that is solely responsible for the hiring and retention of its CEO. Planned Parenthood of America does not have the power to remove CEOs or directors from its individual member organizations.
Now, Mr. President, this type of federated structure is common in the nonprofit world, and it is the reason why nonprofits such as the YMCA and Boys & Girls Clubs also qualified and received PPP loans, forgivable loans. We recognize that they have a large national structure, but the individual entities are small entities and are independently managed and controlled.
In May of 2020, under the Trump administration, 38 Planned Parenthood entities received correspondence from Associate Administrator Bill Manger with a preliminary finding that the entities may not be in compliance with the affiliation rules.
To my knowledge, Mr. Manger only sent letters to Planned Parenthood entities, not to any of the other similarly structured entities. Now, I say that because we now have learned that there was a list--a hold list of a much larger number of entities that there was a concern as to whether they qualified under the affiliation rules, but only Planned Parenthood received the May 2020 letter, not the other groups that had a similar structure.
The letter that was sent out is titled ``Notice of Investigation and Request for Records.'' This was sent out in May 2020 to 38 Planned Parenthood entities. The Planned Parenthood entities responded to these letters. They contested the finding. Every Planned Parenthood company that received correspondence in May of 2020 contested its findings. The letter is pretty detailed in what it spells out. It spells out all the reasons why they comply with the affiliation rules, and it talks all about it, about all the different reasons why they were qualified to receive their funds.
Mr. President, it ends with this line. This is how Planned Parenthood responded to the May 2020 letter:
I trust that this response resolves the matter.
May 2020.
Nine months later, under the Trump administration, no additional action that we are aware of was taken by the SBA to contest Planned Parenthood's eligibility for the PPP money, so it was clear that the Trump administration decided not to take action.
So where are we now?
It is also important to note that PPP loans were not used by Planned Parenthood to provide any health services. We are not talking about providing health services here. The law is very specific as to what the funds can be used for: payroll costs, healthcare benefits for the employees, paid leave for the employees, allowance for dismissal or separation, interest on mortgage expenses, rent and utilities, interest on debt prior to February 15, 2020.
I was somewhat puzzled by all of this, but in an attempt to broker another compromise, after dealing with whether the PPP loans and the business entity were proper, whether there was any semblance of concern about his attitude in regards to Israel--having satisfied that, I made another effort to try to deal with Senator Paul and the members of the committee to see what they wanted.
Mr. Syed had nothing to do with these loans. Mr. Syed is fully qualified. The SBA needs a Deputy Administrator confirmed to deal with all of the programs that we have passed in the last 2 years to help small businesses. They need a confirmed manager to work between us and our constituents and make sure these programs are working effectively.
So what else could I provide? Yesterday, I invited all of the Republican members to come to my office--or come to the small business office and we would make available all of the information SBA has in regards to these Planned Parenthood loans. They will make it available--all the loans that were given out, when they were given out, what was forgiven, what was not forgiven, second-round PPP loans, all of it. I don't know what else we can do. Not one showed up to review the information.
I can appreciate the fact that this issue may make Republicans who oppose Planned Parenthood politically uncomfortable. I can understand that. But Democrats also disagree with views of many organizations that received PPP loans.
Last December, the Washington Post reported that 14 organizations designated as hate groups by the Southern Poverty Law Center or the Anti-Defamation League received PPP loans. These are legal entities that qualified for the program because we can't draft it based upon the mission of a particular organization; we have to draft it in a way that those that are legitimate businesses and operations can qualify for the loans. And we did that. We don't judge who we are giving the money to, whether we like what they are doing or not. That is not what this is about.
As I said in the committee a little earlier today, it is important for the Small Business Committee to get back to its bipartisan tradition.
I hope that my Republican colleagues will accept the information that we have made available, work with us, and let's get Mr. Syed confirmed. Let's get him confirmed because he is the right person for this position at this time. The SBA desperately needs a confirmed Deputy Administrator, with all the work that we put on them, and all the help. Our small business community needs to have an accountable, confirmed Deputy Administrator so that they have an accountable person who can work with us to make sure our programs are not only administered properly but we get the information to modify these programs to make them work moving forward. We are already in the process of considering additional legislation. It is so important to have a confirmed Deputy Administrator of Mr. Syed's experience in order to help us with that.
I must tell you, Administrator Guzman is doing a fantastic job. She is one person. She needs a Deputy. It is time that we get this person confirmed. There has not been an articulated reason why this person should not be confirmed.
Mr. President, I know we have had this debate on nominations that are here on the floor. We are wondering why people vote against them. I can't even get a vote in our committee on this because the Republicans won't show up for a vote.
I think, in respect for the system, it is important that the Small Business Committee have an opportunity to vote on Mr. Syed's nomination, which I hope then would be on the floor promptly for confirmation.
I see that Senator Lee seems to be on the floor.
I yield the floor.