Mr. President, similar to Senator Cantwell, I want to talk a little bit about the small business provisions in the American Rescue Plan and the urgency of passing the recovery act as soon as possible. We need to act in order to deal with…
Mr. President, similar to Senator Cantwell, I want to talk a little bit about the small business provisions in the American Rescue Plan and the urgency of passing the recovery act as soon as possible. We need to act in order to deal with the recovery of COVID-19 for our Nation.
As chair of the Small Business and Entrepreneurship Committee, it is critically important to the health of small businesses that we act on the American Rescue Plan. Small businesses are critically important to our economy. I think the Members of this body understand that.
Two out of every three jobs in the private sector are created through small companies. Innovation takes place in a much larger amount in small companies. Just look at how small companies have adjusted to COVID-19. We have seen curbside pickup. We have seen the use of the online deliveries. We have seen ways in which small businesses have shown that they can figure out ways to try to stay alive under any circumstances.
But there is another factor about small businesses, and that is that they are not as resilient to deal with an economic downturn as the larger companies are. So whenever we go through any type of a recession, small businesses suffer the most. So for all of those reasons, it was critically important for us to act to help America's small businesses.
Democrats and Republicans worked together to create a way in which we could help small businesses during this pandemic. It is interesting that the very first bill that we passed removed the restrictions in regard to the EIDL Program so that those businesses that suffered as a result of the pandemic could qualify for the Economic Injury and Disaster Loan Program under the Small Business Administration. We did that because we realized that government was imposing restrictions on small businesses in their operations, and we had a responsibility to act.
And then in mid-March of last year--not this year, but mid-March of last year--we passed the CARES Act, almost a year ago. It recognized that this pandemic was having a major impact on our small businesses. We didn't realize how long the pandemic would last. We thought it would last a few months. We certainly did not think it would last a full year, and now beyond a year. We passed innovative programs in order to save small businesses.
In the one that got perhaps the most attention, the PPP program--the Paycheck Protection Program--we initially provided $350 billion. I would like to think of the CARES Act as, really, a Marshall Plan. It was a Marshall Plan to deal with COVID-19. It provided the
monies for vaccination, research, testing, and for public health, to help our States and local governments, to help schools, but it also provided money in a major way to help small businesses. So $350 billion was initially provided through the Paycheck Protection Program because we realized that rather than having to put more money into unemployment insurance, wouldn't it be better to keep people on payroll so that small businesses can retain their essential workforce? And it worked. The program was very, very popular.
But we did more than just the Paycheck Protection Program. We also expanded the Economic Injury and Disaster Loan Program, or the EIDL Program, because we recognized that forgivable loans of a limited amount of money was not enough to carry businesses over during the pandemic. They were going to need longer term loans. EIDL is a 30-year low-interest loan, up to 30 years. And we also created a new program known as the EIDL Advance Program, which was cash--it was not a loan, not a forgivable loan; it was a grant of up to $10,000--because we know for many small businesses, particularly the most stressed and the most challenged, taking on another loan was not a possibility. So we provided an EIDL Advance of up to $10,000.
We also provided for loan forgiveness for those who had existing or had recently taken out 7(a) or 504 loans under the Small Business Administration.
These programs were exceedingly popular--so popular that, within just about a matter of weeks, we started running out of resources. We had appropriated, we thought, a significant amount of funds, but we found that $350 billion went pretty quickly. So we came together, and we replenished the funds. We put more money into the Paycheck Protection Program, and we also recognized that we had to provide more flexibility because businesses were suffering, and they needed more ability to be able to use those funds. So we granted additional flexibility.
When we passed the CARES Act, we thought this pandemic would be over with by last summer. Well, that was not the case. So we came back together again and recognized we had to do more. We passed, as you know, this past December in the Omnibus legislation another round of help for America's small businesses. This time, it was $325 billion of additional help.
We provided additional eligibility for entities that had not qualified before for the Paycheck Protection Program, and we provided a second round of the Paycheck Protection Program. But we targeted that second round to those small businesses that were in underserved communities, minority communities, and the smaller of the small businesses. We helped mission lenders, such as CDFIs and minority depository institutions so that we could really try to reach the underserved communities.
And we established a program for shuttered venues. Why? Because shuttered venues were shuttered. These were institutions that could not operate because of a government order, and we recognized we had to do something special in order to deal with that.
So when you put that all together, what happened? Well, we saved a lot of small businesses, and we should be proud of that record. Seven million Paycheck Protection Program loans--forgivable loans--were granted for $678 billion. There were 3.7 million EIDL loans given for $200 billion. And we were oversubscribed for the EIDL Advance of $20 billion. So we were able to really help, but more is needed.
When we passed the Omnibus bill in December, we recognized that that would hold us until March. Well, it is now March. We need to act to complete the work.
The Trump administration, in administering the SBA programs, did things that we thought were unacceptable. They put a cap on the EIDL loan of $150,000. The statute says $2 million. Many businesses needed more help than was given by the administration of the EIDL loan program. The EIDL Advance Program was supposed to be up to $10,000, but the administration administered it at $1,000 per employee, making it far less desirable than Congress intended.
And, quite frankly, the underserved communities were not being met at the level that we had expected. I say that because Senator Shaheen and I put a provision in the CARES Act, now known as page 30, that required the SBA to make special efforts to get to the underbanked communities because we realized the underbanked communities were going to have difficulty getting loans that were forgivable. Their own inspector general of the SBA said that the SBA did not carry out the intent of Congress. So we needed to do more to reach those communities that were being left behind.
That is why action is needed. I want to compliment the Biden administration. They have taken administrative action to try to help us on this. They have opened up for 14 days exclusivity under the PPP program for those businesses that are 20 employees or less. The smaller of the small businesses are those that are having the most difficulty surviving in this climate. And they had a much more real--by Executive order or by administrative action, they now have a much more realistic formula for the self-employed as to how much they can receive under a PPP loan. They were able to do that through Executive action, and they removed the discriminatory nature against returning citizens being able to qualify for these forgivable loans.
The Biden administration has taken action. Now it is necessary for us to take action and come in with the American Rescue Plan. We need to pass it, $50 billion of additional help directly--directly--to small businesses to make the EIDL Advance really work for those in low-income communities so they can get their full $10,000 grant that we intended them to receive. So that we can make that work, we need to provide another $15 billion to the EIDL Advance Program, targeting it to the underserved communities.
We have a program to help our restaurants--why help the restaurants?--with $25 billion. Here is the fact. Even with the restaurants starting to come back, we are 2 million jobs less in the restaurant field since the beginning of COVID-19--2 million jobs less. The National Restaurant Association estimates that 110,000 restaurants have either shuttered for good or are shuttered today as a result of COVID-19. We need to direct help to the restaurant community.
The shuttered venue program needs additional support, so an extra $1.25 billion is provided for shuttered venues. I will just give you one example. The Merriweather Post Pavilion located in Howard County, MD--I have been there many times--has not operated since last March. They need help. A thousand jobs are dependent upon the Merriweather Post Pavilion.
I am sure every one of my colleagues could mention the venues in their own State that have been shuttered as a result of COVID-19 that need that help.
We provide $7.25 billion for nonprofits, expanding eligibility, and for the digital news platforms that need help. Johns Hopkins University has done a study, and it has shown that the employment level in our nonprofit community has dropped 1 million jobs since COVID-19 occurred. We know the great work that they do, how they step up and help us anytime, but particularly during a pandemic and during a national crisis. They need help, and they should be eligible to be able to receive the help under the Small Business PPP program. This bill will provide that flexibility so they can get the help that they need-- another reason we have to pass the American Rescue Plan.
Then, lastly, let me mention the community navigators. There is a modest amount of money here so we can have people who can help those who are not as sophisticated to be able to get the help that they need through a community navigator. Yes, we have the Women's Business Centers. Yes, we have the Small Business Development Centers. But we need more help. I think the record has shown that.
Then, lastly, let me say, yes, we need to pass the American Rescue Plan for the direct help to small businesses, but they also need our economy to return to some degree of normalcy. That is why there is help for opening our schools, help for State and local governments, help for families with direct payments and unemployment insurance, SNAP benefits, COBRA protection; why the vaccine distribution is so important, the Medicaid expansion, housing assistance. And I could go on and on and on.
America needs the American Rescue Plan, and they need it now. Democrats
worked with the Trump administration so that we could get help during that administration. Republicans need to join us in helping the American people.
Let's pass the American Rescue Plan, and let's do that as soon as possible.
Mr. President, I rise today to go over with our colleagues the importance of the American Rescue Plan as it relates to small businesses.
As every member of this Chamber knows, small businesses are the growth engine of the American economy. Small businesses are where jobs are created--creating two of every three new jobs and employing almost half of the Nation's private sector workforce during the years leading up to the pandemic.
Just as important as the jobs they create, small businesses are where innovation happens in our economy. They are the entities that are figuring out better, more efficient ways of doing things.
Mr. President, we are 1 week away from the 1-year anniversary of the historic day on March 11 of last year when the World Health Organization declared COVID-19 a global pandemic.
In the year since, we have seen small businesses nationwide struggle, but we have also seen their creativity and ingenuity on display. We have seen the restaurants that have moved to curbside pick-up and online deliveries because it is unsafe to have in-person dining.
These small businesses are the reason why our economy is performing at the level it is, which may not be the level we want it to be, but the ingenuity of these small businesses have put us in a much better position.
But Mr. President, there is another characteristic of small businesses that I think we all understand.
We all understand that they don't have the same degree of resiliency as larger businesses, because they operate on razor-thin margins, they don't have deep pockets, and as a result, they often struggle to find outside financing. So when our economy hits a bump in the road, small businesses suffer the most.
So Mr. President, when the impact COVID-19 would have on our economy became clear last year, it was particularly important for us to respond to help our small businesses so that when we get out of this pandemic, when our economy returns, our small businesses emerge in a position to help our economy recover, and continue to grow.
We had to support our small businesses, because the public health restrictions on public gatherings--which have saved thousands of lives and kept our communities safe--have been especially challenging for small businesses.
So Congress had to respond, and we did. Our first major response was the CARES Act--a bold, bipartisan bill that was created to help small businesses, families, and create a ``Marshall Plan'' for healthcare, which put money into vaccine development, producing personal protective equipment, and put money into testing and other public health measures.
Because we recognized then, and now, that we have a responsibility as the federal government to control the pandemic.
So the very first bill we passed in response to the pandemic made small businesses affected by the pandemic eligible for the Economic Injury Disaster Loan program.
Traditionally used to help small businesses recover from a natural disaster like a hurricane or a tornado, EIDL provides low interest, long-term--up to 30 years--loans to help businesses recover.
IT was important that we include EIDL as a tool in the Small Business Administration's toolkit, because we knew small businesses would need the flexible, patient capital provided by EIDL.
Next we passed the CARES Act, which provided more than $370 billion in direct aid to small businesses bearing the costs of keeping us safe.
It created the Paycheck Protection Program, a bipartisan program designed to keep employees on payroll. And we appropriated $350 billion to the program.
We did this because we recognized at the time that while a business could lay off workers who could then collect unemployment, it would be better to keep them on payroll.
PPP provided an immediate influx of aid to small businesses through forgivable loans equivalent to 2 months of payroll costs that could be used primarily for payroll, but for other business expenses as well. For small businesses that used the appropriate portion of their PPP loan for payroll, the loan would be forgiven.
To complement EIDL and PPP, we created the EIDL Advance grant program for those small businesses that were unable to take out a loan because they were struggling to pay their existing loans.
The EIDL Advance program would provide grants up to $10,000 for our most vulnerable small businesses. For many businesses, the grants were a lifesaver that provided an immediate cash infusion without having to worry about additional loans of their books.
We also created the SBA Debt Relief program to cover the monthly payments on new and existing traditional SBA loans, including SBA 7(a) and 504 loans.
Mr. President, the CARES Act was signed on March 27, and according to SBA, more than $340 billion in PPP loans were approved by April 16-- roughly 3 weeks after the bill was signed.
So we had to appropriate additional funds for the program due to the demand for the loans. We also made PPP more flexible for small businesses in recognition of the fact that our Nation would be confronting the pandemic for months to come and that we would not have the pandemic behind us by summer, as we had hoped.
PPP, EIDL, EIDL Advance grants, and the SBA Debt Relief program helped save many small businesses.
We only need to look at the numbers.
Since the creation of PPP last March, SBA has approved more than 7 million PPP loans worth more than $678 billion. Most of those funds went directly to the millions of employees at those small businesses to care for themselves and their families. SBA has approved more than 3.7 million EIDL applications providing loans worth more than $200 billion.
The EIDL Advance grant program has exhausted its initial $20 billion appropriation.
In the months since these programs have been up-and-running, Mr. President, we have learned many lessons that we must now deploy in order to finish the job of ensuring that small businesses are protected through this pandemic.
We learned that the historic barriers that small businesses in underserved communities, especially Black- and Latino-owned small businesses, do not have relationships with the traditional banking institutions that make PPP loans.
Senator Shaheen and I were concerned about this as we wrote the CARES Act, which is why we put a provision in the bill that required SBA to issue guidance to banks participating in PPP to prioritize loan applications from underserved small businesses.
Unfortunately, SBA did not do that, which led the SBA IG to issue report that found that SBA's implementation of PPP ``did not fully align'' with the Congressional intent of the CARES Act.
In response to SBA's failure to issue that guidance, a group of stakeholders advocating on behalf of minority businesses started a group known as the Page 30 Coalition, because the provision I talked about was on page 30 of the CARES Act.
PPP wasn't the only program harmed by the way it was implemented by the Trump administration.
The Trump administration hindered the utility of EIDL by capping loans at $150,000, which is far below the $2 million cap that is in statute.
And EIDL Advance grants were made less useful to small businesses due to the Trump administration's decision to provide EIDL applicants with $1,000 per employee for up to 10 employees, instead of the $10,000 grant provided by the CARES Act.
So I was pleased that we finally lived up to our overdue responsibility to pass more economic aid in December. The bipartisan $900 billion relief bill provided an additional $325 billion in aid to small businesses and included provisions to make PPP a more useful program for more of our most vulnerable small businesses.
The bill provided $284 billion for first and second PPP loans, and it set aside
$15 billion for mission lenders, as well as another $15 billion set- aside for certain smaller financial institutions, such as credit unions and farm credit institutions.
The bill also made SBA's 7(a) and 504 loan programs more affordable for borrowers and less risky for lenders; those programs helped jumpstart the economy following the Great Recession.
The bill provided $20 billion for targeted EIDL Advance grants that will be provided to small businesses in eligible low-income communities. For small businesses in these communities that already received an EIDL Advance grant, SBA will provide them with the difference for a full $10,000 grant.
And we extended the Small Business Debt Relief Program for several more months, which freed up cash flow for small businesses to use for working capital.
Mr. President, I am proud to share that the changes to PPP are already yielding results.
Data from SBA on this current round of PPP shows lower loan averages, which indicates that more of the smaller, more vulnerable small businesses are receiving loans this time than they did during the initial months of PPP.
I was very proud last week after the Biden Administration announced steps it was taking to make PPP a more equitable program and provide relief to the many of Black- and Latino-owned small businesses that were left out of, or underfunded, during previous rounds of relief.
The changes include a 14-day dedicated window for small businesses with fewer than 20 employees to apply for PPP; an improved loan calculation formula for sole proprietors, independent contractors, and self-employed individuals; and the elimination of an unnecessary restriction that prevented small business owners with a prior non-fraud felony conviction from obtaining a PPP loan.
These changes will help many small businesses secure the aid they need.
Now is the time to seize on that momentum.
The American Rescue Plan will deploy an additional $50 billion to the communities and industries that still need help, and are likely to need continuing support in the months to come.
Mr. President, this bill is necessary right now, because the industries that have been hardest hit by the pandemic are also the industries that will take the longest to resume full operations after the pandemic--some of which are reliant on large crowds to turn a profit; others because they are already struggled to access capital before the pandemic, and will only be worse off after it.
It is vital that we provide additional funding to these industries, because they have accounted for a large portion of the jobs lost during the pandemic.
According to the National Restaurant Association, as of December of last year, 110,000 eating and drinking places were closed for business temporarily, or for good, and the sector finished 2020 nearly 2.5 million jobs below its pre-COVID level. And at the peak of initial closures last year, the group estimates that up to 8 million restaurant employees were laid off or furloughed.
The live events industry also needs additional support, because they are the most reliant on large crowds to turn a profit, and businesses in the sector often support hundreds of jobs, both directly and through their relationships with other businesses.
In my home state of Maryland, for example, Merriweather Post Pavilion in Howard County supports nearly 1,000 jobs across the State.
We must also expand support to more nonprofits, because the job losses caused by the pandemic have not been limited to the for-profit entities. According to a report from the Johns Hopkins University, there are nearly 1 million fewer nonprofit jobs today than there were in February of last year, including the 50,000 jobs lost by the nonprofit sector in December. The report projects that it will take 18 months to regain the nonprofit jobs lost during the pandemic.
It goes without saying that getting these jobs back as quickly as possible will be key to a swift, robust recovery. And enacting the American Rescue Plan will help us do just that.
What these small businesses need more of however, are not loans, but grants.
That is why the American Rescue Plan includes $15 billion for targeted EIDL grants to provide hard-hit, underserved small businesses with increased flexible grant relief, which will be particularly helpful for very small businesses and sole proprietors.
This provision is especially important for minority-owned businesses, which are more likely to be sole proprietors and have fewer employees on average.
The American Rescue Plan will also create a $25 billion dedicated grant relief program for restaurants, and it will provide an additional $1.25 billion to the Shuttered Venue Operators Grant program, which was created by the December bill.
The American Rescue Plan will expand PPP eligibility to additional nonprofits that are providing essential social services, as well as digital news services that are keeping our communities informed about the pandemic.
The plan provides SBA with an additional $1.325 billion in administrative funding to implement and scale up these grant programs.
And lastly, the plan provides $175 million for a community navigator pilot program designed to help small businesses in underserved and underbanked communities access the COVID-19 resources available to them.
If we remember from the Affordable Care Act, community navigators help get information out to hard-to-serve communities, and they will help small business owners apply for the programs that best meet their needs.
They are a good complement to SBA's existing resource partners, such as the Women's Business Centers and Small Business Development Centers.
Mr. President, President Biden promised the American people that help is on the way, and that is exactly what we intend to do by passing the American Rescue Plan into law.
It is a bold approach, because the problems we are facing are so great. We must pass this bill immediately.
With that, I yield the floor.
Mr. President, I oppose this amendment. This is a matter of basic fairness.
When we passed the Paycheck Protection Program, it included nonprofits. We didn't have the cost estimates for all the (c)'s. Originally we only included the (c)(3)'s. We added the (c)(6)'s during the omnibus. This adds the rest of the (c)'s, other than (c)(4)'s, with the protection against lobbying activities, et cetera, that is in the bill. The standards are the same as they are for the other nonprofits. This is just a matter of fairness.
Let me just point out, according to information that we have received from a Johns Hopkins University study, we have lost over a million jobs in the nonprofit sector as a result of COVID-19. This bill is needed, and we need to be fair to all the nonprofits.
I urge my colleagues to reject the amendment.
Vote on Amendment No. 1014
Mr. President, I oppose this motion to recommit. This moves us in the wrong direction.
We have had bipartisan support recognizing that those who have been convicted of crime, once they paid their price, should be able to participate in our society.
The motion to recommit would suggest that someone who may have participated in a rally while they were in college 15 years ago and has a perfectly clear record could be prevented from participating in the SBA programs. That is moving in the wrong direction. I hope we would have strong rejection of this amendment.
Mr. President, I want to correct the record or at least clarify the record for Senator Lankford. He raised the point in regard to administrative funds being made available to the SBA. There was a small amount, $70 million, put into the program. That is additional funds.
The EIDL loan program is $200 billion worth of loans, so it is a much larger program, and that was just some additional funds that were being put into the program.