WASHINGTON – U.S. Senator Chris Coons (D-Del.), a member of the Senate Committee on Small Business and Entrepreneurship, is working to include several of his small business priorities in the next COVID-19 relief package, currently being negotiated between the Democratic congressional leaders and the White House.
“Federal support through the Paycheck Protection Program and small business debt relief has been a lifeline for small businesses and nonprofits up and down the state of Delaware and across the country. As the COVID-19 pandemic and economic crisis continue to ravage our communities, Congress must ensure that our small business owners get the support they need to survive,” said Senator Coons. “I’m encouraged to see bipartisan support for a second round of PPP loans to hard-hit small businesses, but there is more to do to reach businesses most at-risk of closing and those owned by people of color. We also must expand oversight and transparency for these programs to prevent corruption and abuse.”
Senator Coons’ small business priorities for the next COVID-19 relief package include:
The Prioritized Paycheck Protection Program Act:
Sen. Coons is pushing to include his Prioritized Paycheck Protection Program (P4) Act that he introduced along with Sens. Ben Cardin and Jeanne Shaheen. The bill allows for the hardest-hit small employers, including sole proprietorships and self-employed individuals, to apply for a second Paycheck Protection Program (PPP) loan once they have appropriately expended an initial loan. The bill would also extend the deadline to apply for a first PPP loan to the end of the year. This P4 Act has drawn bipartisan support and a modified version is part of the Senate GOP relief proposal. In a final, negotiated version, Sen. Coons supports additional appropriations for PPP, allowing applicants to flexibly determine revenue loss based on the three months of their choice, and for businesses subject to prolonged closures to calculate a portion of substantial loan forgiveness without respect to payroll.
Extension of the Small Business Debt Relief Act:
Sen. Coons calls for an extension of the small business loan relief program created by his legislation, the Small Business Debt Relief Act. Enacted as part of the CARES Act, the Debt Relief program provided $17 billion that the Small Business Administration is required to use to pay six months of principal, interest, and fees on preexisting SBA-backed loans, as well as conventional SBA loans made since the creation of the program. More than 290,000 businesses nationally and about 900 in Delaware have received relief under the program. Given that the program still has remaining funding available, it can be extended without any additional cost. Sen. Coons is calling for an extension of the program that provides additional relief for preexisting loans in sectors with more than 5% employment loss since February, for all microloans and Community Advantage loans, and for new SBA 7(a), 504, and microloans in all sectors.
$1 billion for Community Development Finance Institutions:
Sen. Coons is calling for $1 billion for the Department of Treasury’s Fund for Community Development Finance Institutions (CDFIs), which are private mission-driven financial lenders that deliver responsible, affordable lending to low-income, low-wealth, and other disadvantaged people and communities. CDFIs are certified by the Department of the Treasury and can be banks, credit unions, loan funds, and venture capital (VC) funds. Stepping Stones Federal Credit Union, a credit union that is also a certified CDFI, provides all services at no cost to limited-income communities in Wilmington, Delaware.
Access to long-term, low-interest loans for working capital:
PPP is vital to ensuring immediate relief to small employers. Still, many businesses and nonprofits also need access to flexible, long-term loans with meager interest costs to finance other expenses. Sen. Coons believes a range of tools must be deployed to meet this need, including:
Increased transparency, oversight, and accountability of relief funds:
While relief funds have been a lifeline for millions, the Administration has not provided adequate transparency, allowing too many instances of abuse to occur. Sens. Coons (D-Del.), Elizabeth Warren (D-Mass.), and Richard Blumenthal (D-Conn.), and Co-chair of the Congressional Progressive Caucus Rep. Pramila Jayapal (D-Wash.), and the Chair of the House Democracy Reform Task Force Rep. John Sarbanes (D-Md.) officially introduced the Coronavirus Oversight and Recovery Ethics (CORE) Act (S. 3855), legislation that would ensure stronger oversight, accountability, and transparency in the federal government's response to the COVID-19 crisis. Since unveiling draft legislation on May 12, 2020, wide support has grown for Congress to pass the CORE Act which now has endorsements from 57 organizations, 8 Senate original co-sponsors and 18 House co-sponsors.