CIRT joined business groups calling upon the Trump administration to stop a new effort to scrutinize large businesses that took emergency payroll loans during the pandemic, warning that officials were asking inappropriate questions that appeared biased against borrowers. At issue are "loan necessity" questionnaires that the Small Business Administration has proposed that gathers information from businesses that took Paycheck Protection Program loans worth $2 million or more. The nine-page forms, which the SBA issued with little public explanation, sought details from borrowers beyond what they provided in initial loan applications, including information on quarterly revenue, capital expenditures, dividend payments and whether any employees earned more than $250,000.
Eighty groups including CIRT, the U.S. Chamber of Commerce, the American Bankers Association, and the National Association of Manufacturers warned the SBA and the Treasury Department that the questionnaires introduced a "confusing and burdensome" process for borrowers and PPP lenders. A similar letter was sent to the US House and Senate leadership pointing out the problems associated with the proposed procedures. The broad pushback from the business community is the latest flashpoint over the “Paycheck Protection Program,” which issued $525 billion of emergency loans to more than 5 million businesses as a way to keep workers connected to their jobs. The loans can be forgiven if businesses agree to maintain payroll. In the new questionnaires, the SBA said it was examining the loans “to maximize program integrity and protect taxpayer resources" and to review the "good-faith certification that economic uncertainty made your loan request necessary to support your ongoing operations.” But business groups — representing lenders that issued the loans and the borrowers that received them — say the SBA is using criteria beyond what was required by Congress to evaluate whether larger companies needed the money; pointing out that: submission of revenue and liquidity data "appears to signal a bias against PPP borrowers that managed to survive or remain profitable despite the Covid-19 pandemic." They said the legislation that established the program in March did not include liquidity or revenue tests and so "those considerations are inapplicable and inappropriate as it relates to the forgiveness of any currently outstanding PPP loan." Instead, the business associations said the agencies should ask borrowers for a "narrative statement" with documentation to support their decision to seek the loans.
[For details, see the coalition letters to the Administration as well as U.S. House and Senate Leaders].