Courtney Presses Secretary Mnuchin, SBA for Updates and Transparency on Disaster Relief for Small Business Owners and Farmers
NORWICH, CT – Yesterday, Congressman Joe Courtney (CT-02) joined Rep. Joseph D. Morelle (NY-25) and 55 other Members of Congress in writing to Treasury Department Secretary Steven T. Mnuchin and U.S. Small Business Administration (SBA) Administrator Jovita Carranza to raise concerns about the continued lack of transparency and guidance surrounding the implementation of the SBA’s Economic Injury Disaster Loan (EIDL) program. In late April, Rep. Courtney voted to pass the Paycheck Protection Program and Health Care Enhancement Act (H.R. 266), which allocated $60 billion in additional funding to the EIDL program, and which granted farmers and agricultural producers access to the program. However, SBA has yet to disperse much of the new funding, and many small businesses are waiting on responses to months-old EIDL applications.
Rep. Courtney has also criticized the SBA’s decision to cap EIDL loans at $150,000, given that the law allows small businesses to borrow up to $2 million. In their letter, Rep. Courtney and the Members asked Secretary Mnuchin and Administrator Carranza to provide answers on the status of updates for EIDL applicants and how the SBA is working to improve their process; an explanation on the SBA’s reasoning for lowering the EIDL maximum loan amount; an update on the existing backlog of new EIDL applications for farmers, and more.
Specifically, the Members wrote:
“[The EIDL] has faced persistent challenges throughout the COVID-19 pandemic, creating confusion and stress for millions of small business owners who now, more than ever, need clarity and financial relief.
“We recognize that the SBA is facing an unprecedented volume of applications for EIDL loans and advance grants, which is why Congress allocated an additional $50 billion for the program in late April. It was the intent of Congress that these funds be put to immediate use to provide financial support to millions of small business owners who are anxiously awaiting loan and advance grant approval. Yet, we continue to hear concerning reports from our constituents that applications as far back as March have yet to be addressed and attempts to contact the SBA through the recommended channels are futile.
“We are further concerns by SBA’s unilateral decision to cap EIDL loans at $150,000, despite clear language in law stating that small businesses may borrow up to $2 million. This change was not only inadequately announced, but will leave millions of applicants in the lurch when they discover the loan they have waited months to receive is as much as $1,850,000 under their calculated need to weather this crisis. […] With this in mind, we request answers to the following questions:
- Application Status
- What steps are the SBA taking to update individual applicants, currently in the system, on the status of their application?
- What improvements are the SBA making to ensure applicants are informed of eligibility in a timely fashion?
- EIDL Loan and Advance Grants:
- What was the SBA’s reasoning for lowering the EIDL maximum loan amount from $2,000,000 to $150,000?
- What steps has the SBA taken to update small business owners who applied for loans above the new limit?
- What guidance has the SBA provided current applicants on changes made to available EIDL advance grants, and what they can expect to receive?
“As directed by Congress, we are pleased that agriculture related businesses now have access to the EIDL program, but we are concerned that now over a month and a half after limiting eligibility for EIDL, the SBA has not provided any guidance on when non-agriculture related businesses can begin applying for the loans and advance grants once again. Given the lack of data shared on the status of the EIDL program, we are further concerned that a backlog of new agriculture related EIDL applicants is growing.
- New EIDL Applications:
- What is the existing backlog of new EIDL applicants from agriculture related businesses?
- What is the SBA’s timeline for extending EIDL eligibility to all small business owners?
“Lastly, we echo the call from our House colleagues in a May 4th letter, and Senators in a May 9th letter, requesting regular updates to Congress on the number of applicants served thus far through the EIDL program and the total amount of funds distributed. We understand the SBA is under immense pressure, but the agency is not alone in facing unprecedented demands during this pandemic. Transparency is paramount to providing Congress and small business owners with the information we need to plan for next steps, and we look forward to more timely updates from the SBA.”
To read Courtney’s full letter to Secretary Mnuchin and Administrator Carranza, click here.
Rep. Courtney is co-Chairman of the bipartisan Congressional Dairy Caucus, and has continued to pressure Congressional leadership, the Treasury Department, and the SBA to assist farmers amid the COVID-19 pandemic. In an April 27th letter, Courtney had urged both Secretary Mnuchin and Administrator Carranza to not only work quickly to provide farmers with the ability to apply for and access funding through the EIDL program, but also to expedite their assistance. On May 4, Rep. Courtney announced that the SBA had finally provided farmers and agricultural businesses with access to the EIDL program.