[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]




 
  MEMBER DAY HEARING ON COVID-19 RESPONSE AND RECOVERY: COMMITTEE ON 
                             SMALL BUSINESS

=======================================================================

                                HEARING

                               before the

                      COMMITTEE ON SMALL BUSINESS
                             UNITED STATES
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED SIXTEENTH CONGRESS

                             SECOND SESSION

                               __________

                              HEARING HELD
                             APRIL 23, 2020

                               __________

 [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]      
 
 
                               

            Small Business Committee Document Number 116-080
             Available via the GPO Website: www.govinfo.gov
             
             
             
             
             
             
                           ______

             U.S. GOVERNMENT PUBLISHING OFFICE 
41-291                 WASHINGTON : 2021             
             
             
             
             
             
             
             
             
                   HOUSE COMMITTEE ON SMALL BUSINESS

                 NYDIA VELAZQUEZ, New York, Chairwoman
                         ABBY FINKENAUER, Iowa
                          JARED GOLDEN, Maine
                          ANDY KIM, New Jersey
                          JASON CROW, Colorado
                         SHARICE DAVIDS, Kansas
                         KWEISI MFUME, Maryland
                          JUDY CHU, California
                       DWIGHT EVANS, Pennsylvania
                        BRAD SCHNEIDER, Illinois
                      ADRIANO ESPAILLAT, New York
                       ANTONIO DELGADO, New York
                     CHRISSY HOULAHAN, Pennsylvania
                         ANGIE CRAIG, Minnesota
                   STEVE CHABOT, Ohio, Ranking Member
   AUMUA AMATA COLEMAN RADEWAGEN, American Samoa, Vice Ranking Member
                          TROY BALDERSON, Ohio
                          KEVIN HERN, Oklahoma
                        JIM HAGEDORN, Minnesota
                        PETE STAUBER, Minnesota
                        TIM BURCHETT, Tennessee
                          ROSS SPANO, Florida
                        JOHN JOYCE, Pennsylvania
                       DAN BISHOP, North Carolina

                 Melissa Jung, Majority Staff Director
   Justin Pelletier, Majority Deputy Staff Director and Chief Counsel
                   Kevin Fitzpatrick, Staff Director
                   
                            C O N T E N T S

                           OPENING STATEMENTS

                                                                   Page
Nydia Velazquez..................................................     1
Hon. Steve Chabot................................................     2

                               WITNESSES

Hon. Ed Case.....................................................    14
Hon. Andy Barr...................................................    14
Hon. Gilbert Ray Cisneros, Jr....................................    15
Hon. Gus M. Bilirakis............................................    16
Hon. Veronica Escobar............................................    17
Hon. Ted Budd....................................................    18
Hon. Jimmy Gomez.................................................    19
Hon. Mark E. Amodei..............................................    20
Hon. Susie Lee...................................................    20
Hon. Bradley Byrne...............................................    21
Hon. Michael C. Burgess..........................................    22
Hon. Earl L. ``Buddy'' Carter....................................    22
Hon. Elaine G. Luria.............................................    23
Hon. John R. Curtis..............................................    24
Hon. Derek Kilmer................................................    24
Hon. Greg Pence..................................................    25
Hon. Joe Neguse..................................................    26
Hon. Mike Johnson................................................    27
Hon. H. Morgan Griffith..........................................    28
Hon. Tom Malinowski..............................................    28
Hon. Dusty Johnson...............................................    29
Hon. John Katko..................................................    30
Hon. Brian K. Fitzpatrick........................................    31
Hon. Kim Schrier.................................................    32
Hon. Dean Phillips...............................................    33
Hon. Fred Keller.................................................    34
Hon. Adam B. Schiff..............................................    34
Hon. David P. Roe................................................    35
Hon. Max Rose....................................................    36
Hon. Elissa Slotkin..............................................    37
Hon. Mikie Sherrill..............................................    38
Hon. Steve Womack................................................    38
Hon. Steven Horsford.............................................    39
Hon. Scott R. Tipton.............................................    40
Hon. Haley M. Stevens............................................    41
Hon. Chip Roy....................................................    41
Hon. Mike Thompson...............................................    42
Hon. Glenn Thompson..............................................    43
Hon. Abigail Davis Spanberger....................................    44

                                APPENDIX

Prepared Statements:
    None.
Questions for the Record:
    None.
Answers for the Record:
    None.
Additional Material for the Record:
    PPP Letter...................................................    47
    State of North Carolina Department of Insurance..............    52
    Rep. Bunn Testimony..........................................    53
    Rep. Ted Budd Testimony......................................    55
    Rep. Deb Haaland Testimony...................................    57
    Rep. Derek Kilmer Testimony..................................    58
    Rep. Tom Malinowski Testimony................................    60
    Rep. Dusty Johnson Testimony.................................    61
    Rep. Joe Neguse Testimony....................................    63
    Rep. Tom Rice Testimony......................................    65
    Rep. Jamie Raskin Testimony..................................    67
    Rep. Val Butler Demings......................................    69
    Rep. Albio Sires Testimony...................................    71
    Rep. David Joyce Testimony...................................    72
    Rep. Rosa DeLauro Testimony..................................    74
    Rep. Roger Marshall Testimony................................    78
    Rep. Jerrold Nadler Testimony................................    80
    Rep. Debbie Mucarsel-Powell Testimony........................    82
    Rep. Debbie Mucarsel-Powell Additional Material CARES 2.0 
      Priorities.................................................    84
    Rep. Zoe Lofgren Testimony...................................    88
    Rep. Dan Bishop Testimomny...................................    89
    Rep. Guy Reschenthaler Testimony.............................    91
    Rep. Abigail Spanberger Testimony............................    93
    Rep. Ted Budd Testimony......................................    95
    Rep. Kevin Hern Testimony....................................    97
    Rep. Peter Olson Testimony...................................   101
    Rep. Brian Fitzpatrick Testimony.............................   102
    Rep. H. Morgan Griffith Testimony............................   104
    Rep. Jahana Hayes Testimony..................................   107
    Rep. Scott Peters Testimony..................................   111
    Rep. Ed Case Testimony.......................................   114
    Rep. Gil Cisneros Testimony..................................   116
    Rep. Kathleen Rice Testimony.................................   117


          MEMBER DAY HEARING ON COVID-19 RESPONSE AND RECOVERY

                              ----------                              


                        THURSDAY, APRIL 23, 2020

                  House of Representatives,
               Committee on Small Business,
                                                    Washington, DC.
    The committee met, pursuant to call, at 11:07 a.m., in Room 
2359, Rayburn House Office Building, Hon. Nydia M. Velazquez 
[chairwoman of the Committee] presiding.
    Present: Representatives Velazquez, Finkenauer, Kim, Crow, 
Davids, Chu, Evans, Schneider, Espaillat, Houlahan, Craig, 
Chabot, Balderson, Stauber, Burchett, Spano, Joyce, and Bishop.
    Chairwoman VELAZQUEZ. Good morning. The committee will come 
to order.
    I would like to thank everyone for joining us this morning, 
and I want to especially thank my colleagues for joining us 
today for the House Committee on Small Business Members' Day 
hearing on the response to COVID-19.
    We have a hard stop at 1 p.m. We will move as quickly as we 
can, but should we not be able to accommodate every Member in 
person today, we will be accepting statements for the record 
until Thursday, April 30.
    Today is a chance for the committee to hear directly from 
our fellow Members of Congress about their thoughts on the 
COVID-19 response and priorities for the next package as it 
relates to small business issues within the committee's 
jurisdiction.
    I would like to remind everyone that we are practicing 
social distancing and taking other precautions for all in 
attendance. I appreciate your cooperation in this effort so 
that we can protect ourselves and our hardworking staff.
    Three weeks ago, when Congress created the Paycheck 
Protection Program, we did so with the goal of providing a 
lifeline to small businesses. The program experienced 
unprecedented demand and has proven successful, helping more 
than 1.6 million entities support their employees. As a result, 
we will be replenishing that program later today.
    While we are moving quickly to provide an additional $310 
billion, we still have an obligation to examine what is and is 
not working, as well as gain a better understanding of how to 
best move forward if the PPP must be extended again.
    There have been many red flags that suggest the CARES Act 
has not been implemented as Congress intended. The piecemeal 
guidance and fact sheets Treasury and SBA have released are, in 
many instances, confusing, contradictory, and provide little 
clarity to the millions of small businesses that are in 
desperate need of assistance.
    We are also aware that at least 90 publicly traded 
companies got PPP loans, and, in some cases, more than one. 
This is unacceptable, and I have called on the SBA to use its 
administrative authority now to prevent further misuse. 
Congress will also be exploring ways to address this breach of 
the public trust in the next relief package.
    As such, should we need to allocate more money for these 
programs to meet demand beyond today's infusion, we must pair 
that with commonsense reforms to the program that will ensure 
we are truly helping all American small businesses.
    Thank you again to all the Members for being with us today. 
I look forward to our discussion and to working on your ideas 
to provide the best opportunity for survival and recovery for 
small businesses in all of our communities across this country.
    I now would like to yield to the Ranking Member, Mr. 
Chabot, for his opening statement.
    Mr. CHABOT. Thank you, Madam Chair, and thank you for 
holding this important hearing.
    Before I begin, I want to mention that the Chairwoman has 
been in our thoughts and prayers over these last few weeks. We 
wish you nothing but the best as you continue to recover.
    Small businesses, entrepreneurs, and startups play a 
critical role within the American economy. Not only do they 
employ half of the nation's workers, but they are also 
responsible for creating two out of every three of the new jobs 
in this nation.
    In order to measure the health of the nation's economy, one 
needs only to take the pulse of Main Street America.
    Unfortunately, COVID-19 has devastated small businesses and 
their employees. As a response, Congress created the Paycheck 
Protection Program to provide assistance to as many small 
businesses as possible during this emergency period.
    They are a low interest loan that can be forgiven if used 
for payroll and other qualified expenses. Small businesses have 
a tool available to assist them as they try to weather this 
storm.
    Thus far, the program has experienced extremely high 
demand. Within a 2-week span, all the money within the Paycheck 
Protection Program was exhausted. I urge my colleagues to vote 
to inject more dollars into this program as quickly as 
possible.
    Yesterday, this Committee hosted a bipartisan call with the 
Small Business Administrator, Jovita Carranza. Committee 
members amplified issues facing their local small businesses 
directly to the leader of the SBA. Today, we will hear from 
other Members who have been fighting for their small 
businesses. I look forward to hearing their thoughts and their 
ideas on how the CARES Act relief programs have been 
implemented and suggestions on how Congress can improve them 
moving forward.
    The SBA moved quickly and stood up this brand new program 
in a week. While there have certainly been bumps in the road 
and more clarity is necessary, the SBA rose to the challenge of 
assisting the nation's smallest firms when no other options 
were available. As Members of Congress, it is critically 
important that we work together to assist the nation's small 
businesses, entrepreneurs, and startups. Main Street businesses 
are counting on Federal assistance, so let's deliver.
    I yield back.
    Chairwoman VELAZQUEZ. Thank you, Mr. Chabot.
    The gentleman yields back.
    Due to the floor schedule today and the high demand for 
participation, we will do our best to accommodate all of the 
Members who wish to provide testimony. I would like to remind 
everyone that they will have 2 minutes to provide testimony, 
and I ask you stay within this timeframe to the best of your 
ability.
    Let's get started.
    Let me welcome Congresswoman Abby Finkenauer, Chairwoman of 
the Subcommittee on Rural Development, Agriculture, Trade, and 
Entrepreneurship, from Iowa.
    Ms. FINKENAUER. Thank you, Madam Chair, and thank you to 
the members of the Committee here today. It is an honor to get 
to serve with you, and it is an honor to get to represent the 
folks of the First District in Iowa. I know this is a hard time 
for our small businesses and for our Americans all across our 
country, my State, and in my district.
    You know, it is something that we are all coming together 
here today trying to do more and making sure that our folks 
have what they need. What we do know is that we are likely, you 
know, as this continues, we are going to have to step up and 
continue to listen to the folks in our districts about what 
they are going through and what they need.
    And one of the stories I just wanted to quickly share here 
today is from a man in Monticello who has a sporting goods 
store. You know, he has six employees, and, with high school 
sports canceled for the spring, he is sitting on over $100,000 
in uniforms and equipment he can't sell. He is worried about 
his six employees, and if he is able to keep this store afloat.
    You know, this is why we are doing this stuff today. And 
here is the big thing for me when we looked at plussing up this 
program. We needed to make sure, and we did today, but we must 
do more to make sure that our community-based financial 
institutions also have those dollars to put out there into our 
communities.
    You see, this isn't just about the big businesses that need 
millions of dollars to stay afloat. It is the ones who need 
$10,000, $5,000, $20,000, who have maybe 10 employees, 5 
employees. And, in my district in particular, with the amount 
of credit unions and also small community banks, we need to 
make sure that they have what they need so this actually 
touches folks all across our country, and, again, specifically 
folks in my district.
    I am honored to be here with you guys today to continue to 
do more, and it will be our job to continue to listen to folks 
in our districts and get them what they need.
    And, with that, Madam Chair, I yield back.
    Chairwoman VELAZQUEZ. The gentlelady yields back.
    Now the gentleman from Minnesota, Mr. Stauber, Ranking 
Member of the Subcommittee on Contracting and Infrastructure, 
is recognized for 2 minutes.
    Mr. STAUBER. Madam Chair, it is great to see you today, and 
I wish you all the best.
    Chairwoman VELAZQUEZ. Thank you.
    Mr. STAUBER. Ranking Member Chabot, thanks for all your 
work.
    Thank you for giving me the opportunity to testify before 
you today on behalf of the constituents of Minnesota's Eighth 
Congressional District, and I know the problems that my 
constituents face during this pandemic are not unique. The 
whole country is in this together. But I would like to take 
this opportunity to share what Minnesotans have experienced, 
their struggles during this nationwide shutdown, and how I 
think we can come out of this more resilient, self-reliant, and 
stronger than ever.
    Economic injury disaster loans and the Paycheck Protection 
Program have been major lifelines for the small businesses of 
my district. However, as guidance for each program may come out 
in segments and continue to be forthcoming, many struggle to 
understand which program is best for them.
    Additionally, promises were made in the CARES Act that made 
small businesses believe they would receive their loans in a 
timely fashion. Instead, some have received a fraction of what 
they were promised, while many others received nothing at all.
    I know that the individuals at the SBA and the Treasury are 
working around the clock to effectively implement each part of 
the CARES Act and provide as much clarity as possible along the 
way, but my constituents are rightfully frustrated.
    As a small business owner myself, I know that financial 
uncertainty is completely destabilizing. Many businesses fear 
that by the time they get their loans or even get notice that 
their application has been processed and approved, they will 
have already shut their doors, and some for good.
    With this in mind, I have two priorities that we must take 
on as leaders of the Small Business Committee. The mom-and-pop 
shops are the recipients of the loans. The businesses with even 
as few as two or three employees matter just as much as those 
with a maximum of 500. And we also must prioritize getting the 
PPP and the EIDL loans out the door as quickly as possible.
    I am happy that we are passing legislation today to 
replenish the PPP program and these critical funds for our 
small businessmen and women. If there was ever a time to put 
aside partisanship, it is now. I stand ready and willing to 
assist any way I can to ensure that, as I said in the beginning 
of this statement, our Nation, together, we will come out 
stronger, more resilient, and more self-reliant than ever. We 
must recognize that small businesses are the engine of our 
economy.
    And I yield back, Madam Chair.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    The gentleman from New Jersey, Mr. Kim, Chairman of the 
Subcommittee on Economic Growth, Tax and Capital Access, is 
recognized for 2 minutes.
    Mr. KIM. Great. Thank you, Chairwoman, for this opportunity 
to talk about the critical issues our small business owners and 
the millions across our country who depend on small businesses 
for their livelihood, what they face during this crisis.
    Every day my staff and I talk with small business owners in 
my district who have either had to close their doors or are 
close to doing so.
    We talk with neighbors fighting to get on unemployment, 
hoping the money in their account is enough to pay the next 
mortgage or rent check, hoping that they can keep food on the 
table.
    Later today, we will pass a bill to provide additional 
relief to those same people I hear from. All told, we have set 
aside two-thirds of a trillion dollars aimed to help small 
business owners keep people on payroll and keep their doors 
open.
    If you have been a small business owner who has received 
this help, it has been a lifesaver. But we need to be clear, 
the Paycheck Protection Program has been flawed and does not 
provide the long-term solutions or certainty our small business 
owners deserve.
    From day one, we have seen the Paycheck Protection Program 
fail our small business owners. We have seen inconsistent and 
unclear rules that have made it difficult for lenders to get 
online and small businesses to get the support they need. And 
we have seen small businesses who want to do the right thing 
struggle to meet stringent eligibility and program 
requirements, including the unnecessary 75/25 formula and 
exclusion of many local nonprofits and associations at the 
front lines of this crisis. This simply doesn't work for the 
small sectors and in some parts of this country.
    We have seen money go to big businesses disguised as small 
ones while mom-and-pop shops on Main Street wait for Congress 
to add more money to the pot.
    All of these things need to be fixed, and they need to be 
fixed now. But even if we fix the problems in the Paycheck 
Protection Program and fully fund it for months to come, it 
won't solve the real problem that we face, which is that we 
have to get our country moving forward. We have to stand up a 
national testing program to be able to do so. And we set out a 
course on that, and I urge all of us to work together to make 
sure that that happens, that we test those, and we know who is 
sick and who is healthy, and open up our economy again.
    Thank you, and I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Dr. Joyce from Pennsylvania, Ranking Member of the 
Subcommittee on Rural Development, Agriculture, 
Entrepreneurship, and Trade, is recognized for 2 minutes.
    Mr. JOYCE. Thank you, Madam Chairwoman.
    In this Committee, we often stress that small business is 
truly the backbone of our economy, and perhaps this has never 
been more evident than during this coronavirus pandemic, which 
we recognize is truly a public health and an economic crisis.
    The 13th District of Pennsylvania is home to many small 
businesses, all of which which have been significantly affected 
by the ongoing coronavirus outbreak as the government forced 
businesses to temporarily close their doors.
    Thanks to the resources of the 116th Congress and the CARES 
Act, nearly 70,000 small businesses in Pennsylvania were 
approved for Paycheck Protection Program loans to keep them 
afloat while we fight this invisible enemy. Unfortunately, far 
too many businesses in my district were shut out of the program 
when the funds ran dry last week.
    Additionally, initial confusion on size limitation and 
guidance that did not consider the unique business models of 
agricultural producers kept many farmers from accessing this 
relief. While I am pleased to see the progress that we have 
made to include farmers, more must be done to ensure the future 
of our agricultural producers and food supply chain.
    Over the past weeks, I have spoken with workers, small 
business owners, and farmers in my district who are truly 
counting on the Paycheck Protection Program. They are counting 
on Congress to help them weather this storm.
    And, even though our small businesses continue to face 
trial, there are many that have stepped up, from Guy Chemicals 
in Somerset County, to the Mason Dixon Distillery in Adams 
County.
    Small businesses have changed their course to provide hand 
sanitizer and other items needed by frontline responders. These 
men and women are not only the backbone of our economy, they 
are the hearts of our community. And Congress must continue to 
deliver on our promises for them.
    I thank you, Madam Chair, and I thank the Ranking Member, 
Mr. Chabot, for your leadership and for your continued support 
in these trying times, and I yield back the balance of my time.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Now we recognize the gentleman from Colorado, Mr. Crow, 
Chairman of the Subcommittee on Innovation and Workforce 
Development.
    Mr. CROW. Madam Chairwoman, Ranking Member Chabot, thank 
you for convening this Member Day session of the Small Business 
Committee. I am honored to be here and serve beside both of you 
and all the other members during these unprecedented times.
    I have heard from hundreds of constituents for whom the 
Paycheck Protection Program and the EIDL grant and loan 
programs have been lifelines, but the shortages of these 
programs have both been well documented. So I am pleased that 
we are voting today to ensure that these programs have the 
funding that they need.
    I have also heard about how our Nation's chambers of 
commerce and 501(c)(6) organizations desperately need 
assistance. Some of my local chambers have been forced to lay 
off staff, cut hours, and are facing other immense challenges 
in accomplishing their critical mission. So we have to make 
sure we are addressing that problem and providing funding to 
these 501(c)(6) organizations.
    I would like to highlight my draft legislation, the Small 
Business Credit Support Act, which will help business 
development companies invest more money in more small 
businesses under the Small Business Investment Company Program. 
My bill would increase the amount that they can invest in these 
SBICs. By expanding the SBIC Program, we can further 
incentivize Main Street to help Main Street during these 
critical times.
    Also, as millions of our businesses apply for and receive 
assistance from the Small Business Administration, we need to 
address the cybersecurity needs at the SBA, especially 
considering recent developments that up to 8,000 EIDL borrowers 
may have had their personal information exploited from a cyber 
vulnerability.
    My bill, the Small Business Cyber Awareness Act, would 
require the SBA to report these breaches within 180 days and 
create a better infrastructure framework to move forward and 
address vulnerabilities.
    Finally, as we all know, oversight of important loan and 
grant programs is one of the most important roles of this 
Committee. We have all been very concerned about recent reports 
of larger, publicly traded companies using programs intended 
for our Nation's small businesses.
    So I look forward to working with all the members of this 
Committee to addressing the misuse of these relief programs and 
ensure that transparency and accountability are hallmarks of 
our Nation's response to this crisis and Congress' actions 
going forward.
    Thank you again for your time this morning. I look forward 
to working with you on efforts to both protect our businesses 
and expand investment in our Nation's small businesses.
    I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Now we recognize the gentleman from North Carolina, Mr. 
Bishop, for 2 minutes.
    Mr. BISHOP. Thank you, Madam Chairman.
    Chairwoman Velazquez, Ranking Member Chabot, and fellow 
Committee members, thank you for taking the time to hold this 
hearing today. I wish we were meeting under different 
circumstances, as no one could have anticipated the devastation 
that this virus has caused to the American people, especially 
small business owners and their employees.
    Last month, Congress came together and reassured small 
business by providing necessary relief through the Paycheck 
Protection Program. Though this program is not perfect, it has 
helped over 39,000 small businesses receive over $8 billion of 
relief in North Carolina.
    As the coronavirus forced Congress to stay home, I had the 
opportunity to responsibly visit Hornwood, Incorporated, which 
is a specialty textile manufacturer and the largest employer in 
Anson County, North Carolina.
    In order to fulfill their civic duty, Hornwood has begun 
the process of manufacturing PPE for frontline workers. When 
PPP applications first went online, Hornwood immediately filed 
an application to receive a loan. Due to a snafu in the 
process, they were unable to receive a loan when the funding 
ran out on April 16, so it is good that Congress, albeit 
tardily, is back in Washington to provide funding for this 
program so that small businesses like Hornwood can receive this 
critical funding.
    The Paycheck Protection Program is an emergency program, 
and, in my opinion, everyone involved is working to ensure that 
small businesses survive this crisis. However, the easiest way 
to address this concern is to begin the process of safely 
reopening the economy.
    My biggest observation is that the Federal Government 
cannot provide sufficient relief to substitute for a free and 
open economy. We all know that this debate is raging in every 
corner of our Nation, and I will continue to push for data 
transparency so leaders at all levels of government can begin 
to make educated decisions. However, we are gathered here today 
to discuss how this Committee can work to provide needed relief 
to small businesses.
    I would like to commend leaders throughout the country for 
stepping up to the plate and working with the SBA and Treasury 
to serve as conduits for the Paycheck Protection Program. 
Lenders did not ask for this task, but dutifully stepped up in 
this time of need. Lenders have been able to process the loans 
in record time and better than any government agency.
    Thank you, Madam Chairwoman. My time has expired, and I 
yield back.
    Chairwoman VELAZQUEZ. The gentleman's time has expired.
    Now I would like to recognize the gentlelady from Kansas, 
Ms. Davids.
    Ms. DAVIDS. Thank you, Chairwoman Velazquez and Ranking 
Member Chabot, for holding this Member Day hearing on the 
COVID-19 response and recovery.
    I have heard firsthand how the coronavirus is impacting 
Kansas small businesses and the livelihoods of my constituents, 
and I am glad to be able to share those priorities today.
    Small businesses are the backbone of our economy, and no 
place is that truer than the Kansas Third Congressional 
District I am so proud to represent. Failing to support our 
small businesses through this crisis would have enormous and 
devastating consequences. And, while incredibly important, the 
State and local stay-at-home orders are definitely creating 
tremendous challenges for small business owners and employees.
    There are many challenges and fixes that we need to 
incorporate into the Emergency Injury Disaster Loan, or EIDL, 
program and the Paycheck Protection Program. First and 
foremost, we need more money for these programs now, and I am 
glad that the House is voting today to increase that funding, 
but it is simply not enough. Congress must pass H.R. 6506, the 
Paycheck Protection Program Extension Act, which I am a 
cosponsor of, and would provide $900 billion in additional PPP 
funding.
    We have to make sure that the assistance is going to those 
who need it most, not just big corporations and the well 
connected. It is essential that the PPP and EIDL loans make it 
into the hands of minority, women, and veteran owned 
businesses. I am encouraged that the PPP Increase Act, which 
the House will vote on today, sets aside $60 billion for small 
and medium lenders, credit unions, and community development 
financial institutions, which are more likely to work with 
smaller and less-advantaged businesses.
    It is also critical that the congressional intent is 
followed in implementation of these programs. For example, in 
creating the PPP, Congress expanded program eligibility to 
include all tribal enterprises with fewer than 500 employees. 
However, the SBA and Treasury severely limited and essentially 
excluded tribal enterprises, especially tribal gaming.
    Tribally owned gaming operations provide important job 
opportunities in their areas and invaluable support to tribal 
governments, who, in turn, provide housing, healthcare, and 
other services for their members.
    That is why I led a letter with 37 of my House and Senate 
colleagues from both sides of the aisle expressing our concerns 
and frustration on that. I spoke with Administrator Carranza 
about this.
    I am glad that we are making progress on some of these 
issues, but a lot more work is necessary, and I am looking 
forward to working with all of you on those issues.
    Thank you, and I yield back.
    Chairwoman VELAZQUEZ. The gentlelady yields back.
    Now we recognize the gentlelady from California, Ms. Chu, 
Chairwoman of the Subcommittee on Investigations, Oversight and 
Regulations, for 2 minutes.
    Ms. CHU. Thank you, Chairwoman Velazquez, for calling this 
hearing in response to the COVID-19 pandemic.
    Today, Congress will vote to extend funding for both the 
Paycheck Protection Program and the Economic Injury Disaster 
Loan and Grant Program. In a great step forward, this bill 
includes a $60 billion set-aside in lending authority 
specifically for small community lenders in the PPP that will 
truly serve small businesses. But, by doing this, we address 
the banks' behavior that made such a set-aside necessary in the 
first place.
    For example, my constituent Yuan owns an auto repair shop 
and has both a business checking account with Bank of America 
and a credit card with JPMorgan Chase. Despite these 
longstanding relationships, both of these banks refused to 
accept Yuan's application for a PPP loan. But, with this set-
aside, this will change.
    But PPP must also be improved. It must be improved with 
translations for immigrant entrepreneurs. It must meet the 
needs of our independent restaurants, which have no assurances 
that they will be permitted to legally reopen before the end of 
the 8-week PPP loan period. Under the current structure, these 
businesses risk exhausting their PPP funds and being forced to 
lay off their employees even before they can legally and safely 
reopen.
    It must be improved by extending eligibility for PPP to 
501(c)(5) nonprofit labor unions to ensure that workers have a 
seat at the table. And it must be improved by addressing the 
unique needs of the self-employed, like many of those working 
in the creative industries.
    SBA's regulations limiting EIDL emergency grants to $1,000 
per employee and requiring that 75 percent of loan forgiveness 
applies to payroll costs do not account for self-employed 
workers who may spend as much or more on expenses like health 
insurance and rent as they do on their salaries.
    Thank you, and I look forward to continuing work to improve 
these programs.
    Chairwoman VELAZQUEZ. The gentlelady yields back.
    Now we recognize the gentleman from Pennsylvania, Mr. 
Evans, Vice Chair of the Committee.
    Mr. EVANS. Thank you, Madam Chairperson, and I thank the 
Ranking Member also.
    As my colleagues have said, this is an unprecedented time. 
This pandemic is a true test of our resilience as a Nation. 
Small business has been devastated. However, my office has 
heard that many local businesses are unable to access these 
needed programs. This is greatly concerning.
    It is essential that the SBA program fulfill the objective 
of Congress to help small businesses who cannot survive without 
these loans. News that large restaurant chains received $20 
million in PPP loans has eroded the public trust and confidence 
in these programs and government.
    While many of us are wearing masks, we need the SBA to be 
transparent with taxpayers' dollars. In addition to thinking 
about what small business needs right now, it is imperative to 
think about how our operation in the future. Social distancing 
will entirely be required for the immediate future.
    Consequently, Temple Small Business Development Center in 
Philadelphia is creating two new business training centers. The 
first is the Center for Hospitality Resilience, which will 
instruct small businesses about new regulations that affect the 
food, hotel, and the event industry.
    The second is the Center of Digital Transformation for 
Small Businesses. The center will help small businesses 
transition to e-commerce, which is likely becoming the main 
source of revenue for many businesses.
    It is crucial that we help small businesses not only get 
through this immediate crisis, but we also assist them in 
preparing for the future.
    Thank you, Madam Chair, and I yield back the balance of my 
time.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Now we recognize the gentleman from Illinois, Mr. 
Schneider, for 2 minutes.
    Mr. SCHNEIDER. Thank you, Madam Chair, for holding this 
hearing. I am so greatly appreciative of your leadership on 
this Committee, especially at this difficult time. And I also 
want to make a special call out to your staff. The Committee 
staff has just been extraordinary through this entire crisis.
    I am grateful we are having this hearing today as well. The 
30 million U.S. small businesses employing 55 percent of our 
American workforce is the lifeblood of our economy. They are 
also the heartbeat of our local communities. From urban 
neighborhoods to suburban villages and rural towns across the 
country, they make our Nation work.
    From the start of this crisis, this Committee has stood up 
for small businesses in every COVID relief bill, starting with 
the first one on March 4. We will do so again today, adding 
additional funds for both PPP and the EIDL loans.
    Yesterday, we had a bipartisan call with SBA Administrator 
Carranza. On that call, I stressed the need for the SBA to 
provide applicants to the EIDL program with an update on the 
status of their application. Many of my constituents applied 
for this program weeks ago, some on the very first day of 
eligibility, and have yet to hear back.
    These business owners are making the hard decisions today 
about the future of their businesses and need to be able to 
plan their long-term financial outlook. They deserve to know 
whether they can rely on the EIDL program as a resource. We 
deserve answers.
    On our call with the SBA Administrator, I also stressed the 
critical need for the administration to provide lenders and 
borrowers with clear, updated guidance about how the PPP loans 
are being disbursed. The Administrator did not instill 
confidence that the SBA is prepared for the next round of PPP 
funds, which is why the work of this Committee is so critical.
    It is our responsibility to hold the administration 
accountable for making proper use of the emergency funding 
Congress has provided. I look forward to working with my 
colleagues on and off this Committee to exercise the proper 
oversight of the SBA. We must make sure the SBA is following 
congressional intent and get this funding to the small 
businesses that so desperately need it.
    Thank you again, Madam Chair. I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Now we recognize the gentlelady from Pennsylvania, Ms. 
Houlahan, for 2 minutes.
    Ms. HOULAHAN. Thank you, and I am very grateful to be here 
and to be in service with all of you at this very critical 
time.
    It has never been more evident to me and I think to all of 
us about this critical committee's responsibility and that the 
work that we do here is so essential, that we cannot simply 
afford to be partisan at this time.
    I am also very grateful, as Mr. Schneider is, to you and to 
your staff. You have conducted yourself with enormous 
professionalism at this very difficult time.
    I have spent the last weeks listening to our community, 
holding virtual townhalls with small businesses all over the 
region, and spent time in food banks, seeing the real trauma 
that this is causing. The pain and worry in our communities was 
palatable.
    I am grateful that we have replenished many of our small 
business programs, but I deeply worry that it will be drained 
within days and weeks again. I am grateful that this program 
now allows for agricultural businesses to be included, but I 
look forward, as many of you do, to when all nonprofits will 
also be included.
    And I am grateful that we have carved out part of the PPP 
to include community lenders and to be able to be directed to 
our smallest of small businesses. I am also grateful that this 
bill provides for our hospitals and for testing.
    These small businesses and small business programs are 
meant to be emergency programs and are meant to make sure that 
we are able to address the situation for as long as it exists. 
But this situation will exist as long as the virus is with us, 
and we absolutely need to make sure we have a robust testing 
system developed, a nationwide robust testing system developed, 
to be able to return ourselves and our communities to normalcy.
    And this requires, I believe also, our legislation to be 
conducted with triggering mechanisms to establish for future 
opportunities for funding these programs if and when they 
become necessary. I believe that we need to not continuously 
have to reauthorize what is clearly a lifeline for our small 
businesses until such time as we are able to get out of this 
pandemic.
    I look forward to continuing to work with this Committee 
and the body to protect and defend this Nation and our small 
businesses, and I yield back, Madam Chair.
    Chairwoman VELAZQUEZ. The gentlelady yields back.
    Now we recognize the gentleman from Florida, Mr. Spano, for 
2 minutes.
    Mr. SPANO. Thank you, Madam Chair, and I don't have any 
planned comments. I just would like to say I appreciate your 
leadership during this process.
    And I am excited, although the circumstances surrounding 
all that the Nation has been through these last 2 months isn't 
anything any of us would have asked for, it is an honor to and 
a humbling privilege to be able to serve on a Committee that 
had so much to do with the solutions, I think, economically to 
getting our Nation back on track.
    So I look forward to your continued leadership, and it is 
an honor to serve with you. Thank you, Madam Chair.
    Chairwoman VELAZQUEZ. Thank you. The gentleman yields back.
    Now we recognize the gentlelady from Minnesota, Ms. Craig, 
for 2 minutes.
    Ms. CRAIG. Thank you so much, Chairwoman and Ranking 
Member, and to my colleagues on the Small Business Committee.
    I am honored to serve on the Small Business Committee 
during such a critical time in our Nation's history and 
appreciate all of the work you have been doing to help return 
our Main Streets to prosperity.
    I appreciate the opportunity to come before you today to 
share my district's experience with the Paycheck Protection 
Program and the Economic Injury Disaster Loan Program. I have 
spoken with my team, and I have worked to help many, many small 
businesses across the district. Whether it is a florist in 
Apple Valley or the Cannon River Winery, I have heard numerous 
times that the implementation of the PPP has been flawed, and 
small businesses are waiting far too long to get the relief 
they urgently need.
    I realize we are facing unprecedented times and that the 
SBA is working hard, but it must do better. For every success 
story that is shared with my office, at least a dozen people 
reach out saying that they have been unable to successfully 
apply for a loan. These stories are heartbreaking.
    Constituents also report receiving far less money than was 
promised through the EIDL program, and we must fix that.
    I recently had a call with a number of restaurant owners in 
my district, and they uniformly noted that the PPP as it stands 
will not allow their businesses the flexibility to fully 
achieve the goals that we set for the program. Fixing this and 
providing additional support for nonprofits and cooperatives 
must be resolved in future bills.
    We must also ensure that we are holding the SBA accountable 
through oversight that ensures that big corporations are not 
crowding out the Main Street businesses that this program was 
intended to help. This means getting more data on loan 
applications and issuance, including breakdowns by demographics 
and by congressional districts.
    I am grateful that we will pass a bill today to add 
additional funding to the Paycheck Protection Program and the 
EIDL program, but our work in this Committee going forward must 
ensure that both the amount and the flexibility of these funds 
are really helpful to the small businesses that need it the 
most.
    I know we are all here to help protect each of the American 
Dreams represented by the small businesses in our districts. I 
look forward to our continued work together.
    Thank you, and I yield back.
    Chairwoman VELAZQUEZ. The gentlelady yields back.
    Now we recognize the gentleman from New York, Mr. 
Espaillat, for 2 minutes.
    Mr. ESPAILLAT. Thank you, Madam Chair.
    Small businesses on Main Street are the strength of our 
communities, and the COVID-19 pandemic has made that clear when 
we see all the storefronts close down and hear from our 
constituents about the incredible volume of aid they need and 
deserve. These small businesses define the identity and 
character of our communities.
    For the past two and a half weeks, I have engaged with 
small businesses in Harlem, East Harlem, Washington Heights, 
Inwood, and the Northwest Bronx about the great difficulties 
they have been encountering accessing the assistance provided 
by the CARES Act.
    I can literally count in one hand, Madam Chair, in one 
hand, the number of small businesses in my district who have 
received assistance. These thousands of small businesses that 
were supposed to be helped by this legislation are not getting 
any help. But many of them, many of them have not seen a dime.
    They got tricked. They got led astray. They got bamboozled. 
And they are, respectfully, Madam Chair, mad as hell. I am mad 
as hell.
    This is a major problem. It is absolutely not how any of us 
intended for this program to work. The actors who perpetrated 
this must be investigated, and they must face consequences.
    We need to make sure that Main Street is bailed out. Just 
like Wall Street got bailed out, Main Street must be bailed out 
right now.
    I am glad that the relief package we will vote on today 
will set aside funds for mission-based lenders and insured 
depository institutions, especially in New York City, where the 
credit union, minority depository institutions, micro loan 
lenders, and other small insured depository institutions 
involved in this relief program, institutions like Banco 
Popular, Carver Federal Savings, Harlem Entrepreneurial Fund, 
Neighborhood Trust Federal Credit Union, and the Upper 
Manhattan Empowerment Zone are used and trusted by our 
constituents.
    Thank you, Madam Chair. We must do better. We must bail out 
Main Street.
    Thank you, Madam Chair. I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    The gentleman from Hawaii, Mr. Case, is recognized for 2 
minutes.

  STATEMENT OF THE HON. ED CASE, A REPRESENTATIVE IN CONGRESS 
                    FROM THE STATE OF HAWAII

    Mr. CASE. Madam Chairwoman and members of the Committee, as 
a former Committee member, I am grateful to be able to share 
the profound impact of the COVID-19 pandemic on Hawaii's small 
businesses.
    Small businesses are the lifeblood of my State. Hawaii has 
132,640 small businesses. That is about one business for every 
11 people. They are also smaller than those of most other 
States. A vast majority employ less than 100 people, with the 
average just 12 people. Yet small businesses employ a majority 
of the Hawaii workforce.
    Our small businesses are also the most diverse in the 
Nation, 62.6 percent are minority owned, by far the highest. 
More than a quarter of Native Hawaiian and other Pacific 
Islander-owned businesses in our country are found in Hawaii.
    As Hawaii's largest industry is tourism and hospitality, 
with international and domestic travel dried up and stay-at-
home orders and travel restrictions at home, our economy and 
small businesses are especially hard hit by COVID-19.
    Just weeks ago, our unemployment rate was one of the 
Nation's lowest at just 2.6 percent. Today, well more than one-
third of our labor force has filed unemployment claims, and our 
small businesses are hanging by a thread if they are not 
already closed.
    This committee's incredibly hard work has been a lifeline 
to them, just as throughout our Nation. Especially important 
are your efforts to ensure the immigrant and underbanked 
communities are not left behind.
    Equally important are the small businesses of the tourism 
industry. They were some of the first impacted by this 
pandemic, and they will be some of the last to recover.
    As we continue our efforts together, I urge this Committee 
to consider Hawaii's unique needs and additional assistance. 
While existing programs provide temporary relief, greater 
assistance will be needed to keep these small businesses and a 
very significant portion of my Hawaii's economy alive until our 
State can fully reopen for business.
    I continue to stand ready to assist and incredibly 
appreciate your efforts. Mahalo.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Now we recognize the gentleman from Kentucky, Mr. Barr, for 
2 minutes.

 STATEMENT OF THE HON. ANDY BARR, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF KENTUCKY

    Mr. BARR. Chairwoman Velazquez, Ranking Member Chabot, 
thank you for holding today's hearing.
    As a member of the Financial Services Committee, I was 
closely involved in the development of the CARES Act and, 
during this crisis, have been in frequent contact with lenders 
supporting small businesses as Treasury and SBA implement the 
bill.
    I would like to address three concerns. First, SBA's breach 
of its statutory obligations to its lender partners. Second, 
overreach by the SBA in its eligibility rules. And, third, the 
need to clarify that new owners of preexisting businesses 
qualify.
    First, Congress deputized lenders to deliver small business 
aid, and the CARES Act mandates that the SBA pay lenders' 
processing fees within 5 days of loan distribution. Many 
lenders already distributed funds to borrowers, yet Treasury 
and the SBA have not provided guidance on how lenders receive 
these fees.
    Lenders worked around the clock to process loans and help 
their customers. One community bank in Kentucky told me that 
their employees worked 24 hours a day in three 8-hour shifts 
with supervisors working 16- to 18-hour days. They only took 
off one day: Easter Sunday.
    Their story is not unique. It is shared by small community 
lenders across the country. These lenders must be compensated 
for their work as directed by the statute. Just as Treasury and 
the SBA called on lenders to quickly get money out to small 
businesses, Treasury and the SBA should not hold up their end 
of the deal.
    Second, the SBA's reliance on the existing 7(a) eligibility 
criteria boxes out businesses that Congress did not intend to 
exclude. Horse racing has a long and storied history in 
Kentucky, and horse tracks provide significant downstream 
economic benefits to their communities, but some horse tracks 
are ineligible for PPP loans.
    I expressed these concerns to Secretary Mnuchin and 
continue to voice my support for local horse tracks. I am 
hopeful that the SBA will align its guidance with congressional 
intent and modify this eligibility criteria.
    Finally, one of my constituents was denied a PPP loan 
because he purchased the business after February 15. The CARES 
Act provides only that the borrower must have been operational 
prior to February 15 to qualify. The intent of Congress is that 
the business itself must have been a going concern and 
operational prior to February 15 regardless of the ownership at 
the time. Despite repeated requests for a FAQ from Treasury to 
fix this, we still have no official clarification.
    So I appreciate the opportunity to testify about these 
three issues and appreciate the Chairwoman's oversight.
    I yield back.
    Chairwoman VELAZQUEZ. Thank you.
    The gentleman yields back.
    The gentleman from California, Mr. Cisneros, is recognized 
for 2 minutes.

      STATEMENT OF THE HON. GILBERT RAY CISNEROS, JR., A 
    REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. CISNEROS. Madam Chairwoman, members of the House 
Committee on Small Business, thank you for allowing me this 
opportunity to speak on behalf of the small businesses in my 
district who are dealing with the economic consequences of the 
COVID-19 pandemic.
    At this moment of incredible economic uncertainty, we must 
work together to help our small businesses survive this crisis. 
The Payroll Protection Program and expanded eligibility for the 
Economic Injury Disaster Loan are well intentioned and a strong 
first step. However, I have heard from many in my district 
frustrated with the rollout of these economic relief programs, 
including how limited access often resulted in big banks 
prioritizing large companies. I urge the Committee to continue 
to provide strong oversight.
    Additionally, current eligibility requirements prevent 
organizations that are trusted by small businesses from 
receiving Federal support. This includes local chambers of 
commerce, like in Brea and Chino Hills, and trade associations 
like the National Association of Hispanic Real Estate 
Professionals that provide targeted help to minority and 
underserved businesses. I urge the Committee to expand PPP 
eligibility to include 501(c)(5)s and 501(c)(6)s. These 
organizations ensure that economic uncertainty does not 
undermine their ability to serve.
    Further, I have serious concerns that minority, women, and 
veteran owned small businesses are at increased risk during 
this crisis. Business owners of color have historically faced 
greater barriers in accessing capital, especially small 
business owners with English as a second language.
    I urge the Committee to direct lenders to prioritize PPP 
loans for small businesses owned by minorities, women, 
veterans, and those in underserved and rural markets in the 
next stimulus package, and ensure information is distributed in 
multiple languages to reach all audiences.
    Finally, I urge the Committee to advance legislation that 
will provide more certainty to our small businesses. The 
initial PPP funding provider under CARES lasted less than 2 
weeks. We need to establish automatic mechanisms, such as those 
included in the bipartisan PPP Extension Act introduced by Rep. 
Kilmer, so that we do not keep lurching from crisis to crisis.
    Now is the time for swift action for small businesses. My 
district is home to many small businesses from a diverse range 
of industries.
    And, with that, I thank you for this time to testify in 
front of the Committee.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Now we recognize the gentleman from Florida, Mr. Bilirakis.

  STATEMENT OF THE HON. GUS M. BILIRAKIS, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF FLORIDA

    Mr. BILIRAKIS. Thank you, Madam Chair.
    I want to thank the Chairwoman for allowing us to do this. 
I want to thank the Committee as well for holding this Member 
Day hearing on the coronavirus crisis.
    Since the establishment of the Paycheck Protection Program, 
I have heard from countless constituents, small business 
constituents and owners, that the application process was 
difficult to navigate and that many lenders were not receptive 
to their needs.
    Meanwhile, we discover that many well-known business chains 
received millions of dollars in program funds and that those 
applications may have been prioritized by lending institutions.
    In response to these revelations, I submitted to Committee 
and leadership a letter asking that any future funding of PPP 
loans contain a set-aside specifically for the truly small 
business, the mom and pops of our Nation.
    I was pleased to see my recommendation take form in today's 
funding package that set aside funds for small community banks 
and credit unions, which have a good track record locally of 
getting money into the hands of the businesses that need it 
most. But as we move forward we need to find better ways to 
ensure our local businesses get the help they need during this 
time or any future crisis.
    I am working on legislation that would ensure that a 
portion of the PPP funds or funds from any future similar 
program go toward truly small businesses.
    Our Nation's family-owned businesses and sole proprietors 
shouldn't have to compete with national or international chains 
during this time of crisis. They are in our communities. They 
are for our communities. They engage in local charities and 
teach our kids leadership lessons.
    Let us be there for them. They have been there for us, 
Madam Chair, for so many years.
    And I appreciate it very much.
    Chairwoman VELAZQUEZ. Thank you.
    Mr. BILIRAKIS. I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Now we recognize the gentlelady from Texas, Ms. Escobar, 
for 2 minutes.

  STATEMENT OF THE HON. VERONICA ESCOBAR, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF TEXAS

    Ms. ESCOBAR. Thank you, Chairwoman Velazquez and Ranking 
Member Chabot, for giving me the opportunity to share what is 
happening to small businesses in my community of El Paso.
    Over the past month, I have been holding calls with El 
Pasoans, including a small business telephone townhall, to gain 
a deeper understanding of what is happening on the ground as we 
confront the coronavirus pandemic.
    The Paycheck Protection Program, or PPP, was established as 
a quick infusion of capital for small businesses that have been 
directly affected by the pandemic. However, I have heard from 
many El Pasoans that have yet to receive their loans from the 
Small Business Administration even after being approved.
    Additionally, those who have applications pending say they 
are experiencing a lack of communication regarding their 
application status.
    As the next round of PPP funding is approved today by the 
House, the Small Business Administration needs to ensure that 
funds are distributed in a timely manner and provide effective 
communication throughout the process.
    Another issue many business owners have raised is the lack 
of flexibility; for example, the 75-to-25 spending ratio that 
the Small Business Administration requires for PPP loans. Under 
this rule, 75 percent of the loan must go toward payroll costs, 
while the other 25 percent can go to other business expenses, 
like rent.
    This ratio simply doesn't work for businesses that have 
small payrolls and larger business expenses. We should not be 
punishing businesses simply because they have fewer employees 
than others. The next round of coronavirus package should 
include a remedy for the thousands of businesses who have 
applied for PPP loans but need flexibility.
    Finally, I know I am not alone when I say that it has been 
sickening to see that small businesses like those in El Paso 
have been placed in the back of the line and that large 
corporations and publicly traded companies have been put to the 
front of the line. Our small businesses are the backbone of our 
local economies, and leaving them out in the cold is simply 
unacceptable.
    Congress must impose stronger restrictions on who can 
receive PPP loans in future funding bills and conduct robust 
oversight over the program to ensure that the funding is 
flowing to those who are intended.
    Finally, Madam Chairwoman, I just want to say thank you for 
your incredible leadership during such an unprecedented crisis. 
We are all very grateful.
    I yield back.
    Chairwoman VELAZQUEZ. Thank you.
    The gentlelady yields back. The gentleman from North 
Carolina, Mr. Budd, is recognized for 2 minutes.

 STATEMENT OF THE HON. TED BUDD, A REPRESENTATIVE IN CONGRESS 
                FROM THE STATE OF NORTH CAROLINA

    Mr. BUDD. Thank you, Chairwoman Velazquez, Ranking Member 
Chabot, members of the Committee. Thank you for the opportunity 
to testify today.
    You know, small businesses employ 48 percent of the 
American workforce, and, as a small business owner myself, I 
know that these businesses are often tightly knit teams working 
together to provide services and products in their communities. 
And, when they are forced to make the agonizing decision to 
furlough or lay off workers, it feels like they are firing a 
member of their own family, because, many times, they are.
    What makes this all the more tragic is that the economic 
variables that are forcing their hand are totally beyond their 
control, and the situation is simply not their fault. That is 
why, today, I am going to vote to provide more than $300 
billion in additional funding for the Paycheck Protection 
Program. This program has already given a lifeline to more than 
30 million small businesses, and we need to keep up the 
momentum.
    With each passing day, the spread of the virus has slowed, 
but our knowledge of the virus has skyrocketed. Given those 
facts, we have to begin reopening the economy.
    Now, this can be accomplished while also listening to our 
medical experts and the President's guidelines. I have spent 
weeks on the phone with small business owners across my 
district who don't know how they are going to pay their workers 
if the economy remains indefinitely shut down.
    Since 43 percent of small businesses are considering 
permanently closing if this shutdown continues, we have to get 
the gears of our economy moving again before they crumble and 
devastate the entire American workforce for years to come.
    I look forward to working with you all to reopen our 
country and to kicking off a great American comeback. Thank you 
again for the opportunity to testify today, and I yield back.
    Chairwoman VELAZQUEZ. Thank you.
    The gentleman yields back, and the gentleman from 
California, Mr. Gomez, is recognized for 2 minutes.

STATEMENT OF THE HON. JIMMY GOMEZ, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF CALIFORNIA

    Mr. GOMEZ. Chairwoman Velazquez, I want to thank you for 
having me here today. I urge the Committee to ensure small 
businesses and underserved communities receive the critical 
financial assistance they need and are not turned away by big 
banks.
    California's 34th Congressional District, like others, have 
been devastated by the economic destruction caused by the 
coronavirus. It is home to many talented artists and creatives 
that allow our film, television, and theater industries to 
thrive. Like other freelancers and self-employed individuals, 
they are still waiting to apply for the pandemic unemployment 
insurance. And, if they did apply for a Paycheck Protection 
Program loan, they were last in line.
    My district is also home to vibrant small businesses and 
nonprofits predominantly owned by families, women, and people 
of color. For example, Corissa and Gabriel Hernandez are co-
owners of Xelas Bar in Boyle Heights, a staple in the 
community. They applied for both the Economic Injury Disaster 
Loan and the Paycheck Protection Program over 3 weeks ago and 
have not received aid. They had to make difficult decisions to 
furlough their entire staff. They are one of many.
    Edmundo Rodriguez is the owner of Elsa's Bakery based out 
of Highland Park. When he went in to apply for the paycheck 
protection loan, he was turned away from his business' bank 
despite being a client for over 20 years. He didn't even have a 
chance to apply before the funds ran out. He is one of many.
    It didn't matter that they applied the first day these 
loans became available. Funds were exhausted before they made 
it into the pockets of those that needed it the most: brick and 
mortars. Meanwhile, national hotels and restaurant chains 
received millions.
    It is evident big banks are prioritizing larger loans 
rather than loans on a first come, first served basis. 
Community-based financial institutions rather than private 
banks are more committed to making capital accessible to the 
communities they serve.
    The Paycheck Protection Program and the Healthcare 
Enhancement Act take a step in the right direction by setting 
aside $60 billion for community-based lenders, such as small 
banks, credit unions, minority depository institutions, and 
community development financial institutions. But this isn't 
enough.
    I urge the Committee for more funds to community financial 
institutions and then direct the U.S. Department of the 
Treasury to reveal who is getting the loans and who is not 
getting the loans.
    And, with that, I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    The gentleman from Nevada, Mr. Amodei, is recognized for 2 
minutes.

   STATEMENT OF THE HON. MARK E. AMODEI, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF NEVADA

    Mr. AMODEI. Thank you, Madam Chairman, and I appreciate the 
opportunity to appear in front of you today.
    The purpose of my accepting your invitation to testify 
falls under the lessons learned category. This is the first 
page of the CARES Act. It is a statute enacted by the House, 
enacted by the Senate, signed by the President. This is the 
first page of section 120.110 of the Code of Federal 
Regulations. It was not enacted by the House, it was not 
enacted by the Senate, and it was not signed by any President 
of the United States. It is a Clinton-era regulation that SBA 
promulgated to process SBA loans during regular times.
    Nothing wrong with it in and of itself until, in applying 
the CARES Act, the SBA issues guidance to financial 
institutions that says our internal regulations say you cannot 
apply for a loan.
    Now, the operative language in the CARES Act was any small 
business, which is defined as 500 or less employees. Those 
folks are all fully licensed, legally operating in their 
jurisdictions, paying people, sponsor Little League teams, 
healthcare, retirement, all those things. Many of them were 
shut out because of this situation and other ones where 
internal regs were used as a reason to say you cannot apply.
    My purpose in appearing here today is to suggest to this 
Committee that we need to basically make a differentiation 
between economic disaster, in terms of when we pass something 
that says we want to reach as many people as possible, and 
internal regulations, which are 25-plus years old that, quite 
frankly, bear no resemblance to the time that we are at today.
    So I would commend the Committee's attention to this under 
lessons learned so that we don't have people that are basically 
turned away who are otherwise very deserving under the specific 
language of the statute.
    Thank you, Madam Chair, and I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    The gentlelady, Ms. Lee from Nevada, is recognized for 2 
minutes.

 STATEMENT OF THE HON. SUSIE LEE, A REPRESENTATIVE IN CONGRESS 
                    FROM THE STATE OF NEVADA

    Mrs. LEE. Thank you, Madam Chair. I want to thank you and 
the Committee and your staff. I remember being on a phone call 
with your staff when we passed the CARES Act, and the attention 
in looking at all the possible scenarios really was 
commendable. I was so hopeful when we passed the CARES Act that 
we were going to get the needed aid to our companies, our small 
businesses. It was called the Paycheck Protection Act, as you 
are well aware, to protect the paychecks of all employees.
    What was not included in that act was an exception. Yet 
that exception is impacting my community quite significantly.
    I share the views of my colleague from Nevada, Mr. Amodei, 
as well. There was no statutory mandate excluding gaming from 
this bill, and yet, basically, Washington bureaucrats chose to 
apply a regulation that was not meant in this bill.
    So I ask that this Committee--first of all, I ask that the 
administration finally do the right thing and address this 
administratively. And if they cannot do that or refuse to do 
it--which, by the way, it is sort of bizarre that the bigger 
part of the CARES package applied to our bigger gaming 
operators. They get to access that money. I am talking about 
the restaurant owners, the tavern owners, convenience store 
owners. These are all employees all deserving of protection. I 
know you understand that, and I thank you for all of your work. 
I ask that if the administration continues to make this 
exception--and, in my opinion, overreach--that this Committee 
will address this statutorily in the next round. So thank you 
so much for all of your help.
    Chairwoman VELAZQUEZ. Thank you.
    Now we recognize Mr. Byrne from Alabama.

   STATEMENT OF THE HON. BRADLEY BYRNE, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF ALABAMA

    Mr. BYRNE. Thank you, Madam Chairman. I appreciate the 
opportunity to be here today to speak on behalf of the small 
business owners in my district. Let's not forget that no matter 
how much money we pump out of Washington, it doesn't take the 
place of the American economy. At some point, we have got to 
get back to work.
    I am pleased to know that 27,000 loans have been approved 
for the small businesses in the State of Alabama. Most of those 
are pretty small dollar loans. And I am grateful before the 
legislation for the House today that sets aside specific 
funding for small banks. Alabama community bankers have been 
doing yeoman's work processing thousands of small dollar PPP 
loans, and I hope that all financial institutions will step up 
to the plate and make a commitment to do the same.
    Unfortunately, while we have seen some success with PPP, 
the evidence is clear that the SBA bureaucracy is failing our 
small businesses when it comes to the Economic Injury Disaster 
Loans, EIDL loans. The CARES Act promised $10,000 grants within 
3 days of application was a lifeline for thousands of small 
businesses in my district. It was supposed to be there to help 
them get this money in this unprecedented time. In addition to 
the grantees, businesses are also in desperate need of the 
promised underlying loans to meet working capital needs, often 
to supplement their PPP loans. Yet many of my constituents who 
have received the EIDL loans and grants were disappointed in 
the small amounts that were provided. Most have simply heard 
nothing from the SBA and are unable to obtain answers over the 
telephone system, currently the only process to check on their 
loan status. As of April 20, the SBA reported it had only 
approved 183 EIDL loans for the entire State of Alabama, and it 
appears SBA has only processed at most a quarter of grant 
applications. The situation is totally unacceptable.
    Today I submit to the Committee a letter I sent to the SBA 
with 103 of our colleagues.
    We have asked SBA to brief all of us on the EIDL situation 
and provide answers that our constituents desperately need. 
Thank you again for the time today, and I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Mr. Burgess from Texas, you are recognized for 2 minutes.

 STATEMENT OF THE HON. MICHAEL C. BURGESS, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF TEXAS

    Mr. BURGESS. Thank you. Is that on now?
    Chairwoman VELAZQUEZ. Yes.
    Mr. BURGESS. I thank the Chair, and I thank the members of 
the Committee for allowing me to testimony. This novel 
coronavirus has caused a public health crisis unlike anything 
seen in recent memory. It has not only infected hundreds and 
thousands of Americans; it has infected and affected our 
Nation's economy. Temporarily shuttering businesses to social 
distance is correct, but it has left numerous small businesses 
struggling to survive. The Paycheck Protection Program and the 
Economic Injury Disaster Loan program are vital, and our 
Nation's small businesses are the backbone of our economy, and 
they do need a lifeline during this time of crisis.
    Unfortunately, within the Paycheck Protection Program and 
the Economic Injury Disaster Loan Programs provided by the 
CARES Act excluded 501(c)(6) organizations, which includes our 
local chambers of commerce. Within the 26th District of Texas, 
chambers of commerce have literally worked around the clock to 
ensure that their members have access to needed resources. 
These organizations need support to be able to afford their 
payroll, their billing, and to provide essential services for 
their members. Ranking Member Chabot was good enough to join me 
on a call with my chambers locally earlier this month, and this 
very problem was delineated while he was on the call.
    I also request that the Committee work to relax the 
affiliation rules to allow more businesses with small local 
branches to be able to receive assistance. Some businesses 
employ between 10 and 20 people and operate like a small 
business but are unable to receive assistance because their 
parent company comprises more than 500 employees. During this 
time, we really do need to be practical to ensure that no hard-
working Americans lose their job or their business. As this 
Congress moves to replenish small business funding, we must 
extend assistance to 501(c)(6) organizations and relax the 
affiliation rules. We cannot leave them behind.
    I thank you for your attention. I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    The gentleman from Georgia, Mr. Carter, is recognized.

       STATEMENT OF THE HON. EARL L. ``BUDDY'' CARTER, A 
      REPRESENTATIVE IN CONGRESS FROM THE STATE OF GEORGIA

    Mr. CARTER. Thank you, Madam Chair, and I thank the 
Committee for all the work that you have done. I know you have 
done yeoman's work, and we appreciate it, especially in 
supporting the small businesses across the country. Its 
members, your members, have been a valuable resource as the 
Paycheck Protection Program has rolled out over the last month.
    It is nothing short of unprecedented to stand up a $349 
billion program and send out funds to businesses in such a 
short period. While I am happy to report positive stories of 
businesses in my district, it is not without its flaws, and I 
would like to highlight some priorities for the program going 
forward.
    First of all, in ensuring that funds reach our rural 
communities and agriculture producers, the initial confusions 
about who was eligible for the program, how loans should be 
calculated, or simply just submitting it to the SBA system led 
to a delay for many small businesses in receiving a loan or 
even missing out completely on the program's first round of 
funding.
    One of the biggest confusions that has hindered 
applications has been around how 1099 independent contractors 
should be considered for PPP. The legislative text provides two 
options. Small businesses can include them in their 
applications, or 1099 workers can apply individually. However, 
the PPP FAQ says businesses should not include them. This must 
be clarified.
    The inability to get clear guidance for PPP loans and the 
justifiable fear of the program running out of funds has been 
some of the biggest frustrations my constituents have had over 
the past month. The provisions in today's replenishment of PPP, 
that $60 billion be set aside for smaller lenders, will be 
helpful, but we need to ensure funds are truly going to smaller 
businesses, especially those in rural America. More should also 
be done to promote the PPP liquidity facility created by the 
Federal Reserve to encourage banks to provide PPP loans with 
zero risk. Lenders hitting their lending limit need to be aware 
of the resources.
    In closing, again, I want to thank this Committee for your 
work and for the opportunity to share my district's experiences 
with PPP, and I want to reiterate the need for Congress to 
provide small businesses with certainty throughout this 
pandemic.
    Thank you, and I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    The gentlelady from Virginia, Ms. Luria, is recognized for 
2 minutes.

  STATEMENT OF THE HON. ELAINE G. LURIA, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF VIRGINIA

    Mrs. LURIA. Thank you. Thank you, Madam Chair. Small 
businesses are the backbone of my district as the 115,000 
people employed by small businesses account for more than half 
of all employees in the district. In this time of crisis, more 
work must be done to help all small businesses. Despite 
congressional intent, some business cannot benefit from the 
Payroll Protection Program. SBA must clarify the affiliation 
rules as it relates to PPP loans.
    For seasonal businesses, I recommend directing SBA to base 
loan eligibility on revenues from the same timeframe last year 
rather than from the prior 4 months. I also recommend allowing 
businesses to defer the start of the 8-week period during which 
expended loans can be forgiven until the date the businesses 
can reopen.
    To continue to ensure access for PPP funds, the Committee 
should incentivize banks to serve new customers or prohibit 
banks from restricting which businesses can apply for PPP 
loans. The Committee should also prohibit big banks from 
considering the size of a loan while processing applications so 
the smallest customers have an equal shot at funding. 
Businesses that can provide lower payroll costs as a share of 
overall operating costs should be allowed to use more of their 
loan for nonpayroll costs. This change would be especially 
beneficial for the hospitality and aqua culture and fishery 
industries, which need to pay rent or other maintenance and 
overhead costs for their facilities and equipment. 
Additionally, the Committee should require the SBA to provide 
applicants with clear and transparent timelines for when the 
loan grants and applications will be processed. Finally, the 
Committee must help the SBA balance the quick distributions of 
funds with the program's integrity.
    On behalf of the small businesses of coastal Virginia, 
thank you for this opportunity to share these priorities for 
the upcoming COVID-19 relief legislation, and I will submit my 
full testimony for the record. I yield back.
    Chairwoman VELAZQUEZ. The gentlelady yields back.
    The gentleman from Utah, Mr. Curtis is now recognized.

   STATEMENT OF THE HON. JOHN R. CURTIS, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF UTAH

    Mr. CURTIS. Thank you, Madam Chair, for this opportunity, 
and members of the Committee. This is an unprecedented time in 
our Nation's history, and many of our small businesses across 
the country are experiencing unimaginable losses due to no 
fault of their own. Small businesses are the backbone of the 
Utah economy. As a matter of fact, they make up over 90 percent 
of the businesses in my district. As a former small business 
owner, I have a soft spot in my heart for these courageous 
entrepreneurs who make constant sacrifices in order to grow our 
businesses and our economy. Ultimately, when this is all over, 
I don't believe it will be government that saves us. I believe 
it will be our small businesses.
    The recently passed CARES Act pumps billions of dollars 
into Utah's economy and small businesses, giving over 21,000 
Utah businesses with under 500 employees critical help at an 
important time. Despite this, businesses throughout my 
community need more help and now. This bill we will vote on 
later today is critical to delivering resources to the parts of 
the country and economy that are currently on life support, and 
I am grateful to be here in Washington, D.C., with you and my 
colleagues to vote for this legislation to help our small 
business owners and employees.
    Thank you. I yield back the balance of my time.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Mr. Kilmer from Washington, you are recognized for 2 
minutes.

    STATEMENT OF THE HON. DEREK KILMER, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF WASHINGTON

    Mr. KILMER. Thank you, Madam Chair, and members of the 
Committee. Small businesses aren't only the backbone of our 
economy, they are our economy's star running back. They rack up 
the tough yards, and they score the touchdowns on Main Streets 
across this country, creating over 60 percent of new jobs in 
the private sector.
    As we work to contain the spread of coronavirus and save 
lives, our star running back, our small businesses, are getting 
tackled behind the line of scrimmage. I think the Federal 
Government should do some blocking and call some plays for 
them. And that is why the CARES Act included funding for loan 
programs to help small businesses and their workers get through 
this crisis, including the Paycheck Protection Program to help 
employers keep their workers on the payroll, and I thank this 
Committee for its leadership on that program.
    But these programs have had a rocky rollout, and clearly, 
more funding is needed. I believe there is no time to lose 
because businesses are making decisions right now about whether 
to hunker down and weather through this or fold the tent. And 
that is why I introduced the bipartisan Paycheck Protection 
Program Extension Act to nearly triple the funding in the PPP 
and to extend the program's duration. Our businesses need 
certainty and breathing room to help build demand. My bill will 
ensure that every qualified small business is able to access 
the critical assistance needed to retain their workforce and 
cover basic operating costs for the duration of the pandemic, 
including the ability to get more assistance should tough times 
continue.
    We also need to think about what it means if businesses 
can't fully reopen in 2 months. We can't just think about the 
next play, but we need to know what our call will be in 
multiple situations. That is why Federal assistance should 
build in automatic triggers to kick in if economic conditions 
remain dire and provide additional help when needed. We need a 
game plan that includes more help for small businesses facing 
challenges now, one that also includes stabilizers that work 
quickly and automatically to get help where it is needed when 
it is needed.
    It is time for a comprehensive strategy to help small 
businesses. Think of it as Main Street beast mode to empower 
them to score the points our economy will desperately need. I 
hope this Committee will consider the PPP Extension Act as part 
of that plan.
    Thank you, Madam Chair.
    Chairwoman VELAZQUEZ. Thank you. The gentleman yields back.
    The gentleman from Indiana, Mr. Pence, is recognized for 2 
minutes.

STATEMENT OF THE HON. GREG PENCE, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF INDIANA

    Mr. PENCE. Thank you, Madam Chair. Thank you for the 
opportunity to come before your Committee today. I am glad 
Congress has come together on a bipartisan agreement to 
replenish relief funding for small business. The health and 
safety of Hoosiers and all Americans is and will remain my top 
priority.
    Like all of us here today, we have also been hearing from 
small businesses in the Sixth District of Indiana throughout 
this pandemic and across the country. Today I want to address 
property owners who are not receiving the relief they so 
desperately need. With customers sheltering in place, landlords 
in my district and nationwide are facing a catastrophic revenue 
collapse that will create lasting damage in our communities on 
the property values and on the property tax revenues. Madam 
Chair, even giant retailers who have kept their doors open to 
provide essential services are not paying their rents. Retail 
stores are shutting down and closing, but there is no relief 
for the landlords who run the town centers and strip malls 
which house these stores. The government has forced stores and 
malls to shut down, and many landlords are generously forgiving 
rent to suffering small businesses, but the property owners are 
also financially suffering. We are on the brink of defeating 
this virus, but when our country reopens, will there be stores 
to open back up?
    My colleagues on this esteemed Committee, we must ensure 
landlords are not forgotten in this process. There are many 
Americans who currently own buildings with no paying tenants in 
them, and they have major issues looming. There are several 
companies like that in the Sixth District and across the 
Hoosier State. As a small business owner, I feel it is my duty 
to speak up for them in D.C. as we fight to defeat this virus 
and provide relief for the American people. God bless all. I 
pray everyone stays safe. I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    The gentleman from Colorado, Mr. Neguse, is recognized for 
2 minutes.

STATEMENT OF THE HON. JOE NEGUSE, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF COLORADO

    Mr. NEGUSE. Thank you so much, Madam Chair, for giving us 
this opportunity, and thank you for your leadership over the 
course of the last several months.
    The Paycheck Protection Program has provided some relief to 
struggling small businesses in my district. However, the 
rigidness of the SBA in Washington, D.C.'s interpretation of 
several of these provisions in the CARES Act has blocked 
numerous small businesses in my district, including startups in 
Boulder and Fort Collins, seasonal businesses in mountain 
communities and resort areas, and mom-and-pop restaurants 
across Colorado from accessing these critical funds.
    And so, with regards to the PPP, I would respectfully 
request that the Committee consider the following proposals:
    First, extending the covered period for loan forgiveness to 
longer than 8 weeks so it better reflects the current stay-at-
home orders.
    Providing flexibility for small businesses with low labor 
costs who are unfairly disadvantaged by the rigid 75/25 rule as 
promulgated by the SBA, a huge issue in the mountain 
communities and resort areas that I represent.
    Also, providing flexibility for seasonal small businesses 
by tying the look back period with the corresponding year ago 
2019 period so that our ski areas can recover when this public 
health emergency has passed. I represent Vail, Breckenridge, 
Winter Park, some of the best communities in our country, and 
they have been hit tremendously hard by this public health 
emergency.
    Eliminating the gaming exception, which Representative Lee 
articulated earlier today from the great State of Nevada: The 
Wall Street Journal reported that the hardest hit county in the 
United States of America economically is Gilpin County, which I 
have the honor of representing in Colorado, where mom-and-pop 
restaurants have been severely impacted by the exception that I 
mentioned.
    And then, finally, transparency and accountability 
provisions, which I know that the Chairwoman cares so deeply 
about, so that we can ensure that the taxpayers know how these 
funds are being spent and to stop some of the abuses that we 
have read about.
    Again, I thank the Chairwoman as well as the Ranking Member 
for their leadership in these very trying times and appreciate 
your consideration of these proposals.
    Chairwoman VELAZQUEZ. Thank you. The gentleman yields back.
    Mr. Johnson from Louisiana is recognized for 2 minutes.

    STATEMENT OF THE HON. MIKE JOHNSON, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF LOUISIANA

    Mr. JOHNSON of Louisiana. Thank you, Madam Chair, and 
Ranking Member Chabot, all members of the Committee for your 
work and swift action in helping to produce the Paycheck 
Protection Program. It has worked as we all had hoped. It has 
been a critical lifeline, as you know, saving millions of jobs 
and helping countless small businesses to stay afloat while we 
are in these uncharted waters. We will get through this.
    In Louisiana, it has worked very well. We have had already 
26,635 loans approved worth more than $5.1 billion, and that 
has been essential. The small businesses are the backbone all 
of economy, as we all know, and as we add this additional 
funding to the Paycheck Protection Program today, we are going 
to help a lot more businesses.
    Three ideas very quickly that I hope you will consider 
going forward. Number one, I want to associate myself with the 
remarks of Congressman Pence a few moments ago. We do have a 
catastrophic revenue collapse, and many landlords and property 
owners who didn't have any relief in the PPP, and they have 
been crying out for help, and I think some of that is very well 
deserved.
    Number two, the chambers of commerce. As you know, the 
501(c)(6) organizations were left out of the PPP, and I just 
believe, and I know you do, our local chambers are going to be 
critical players as we begin to rebuild the economy. They are 
the ones that are going to help plug all this back in to get 
the events rebooked and to help the small businesses. So they 
need some due regard.
    And, finally, the last idea, as has been mentioned a couple 
of times, Mr. Neguse and others have said it, we need some 
flexibility, I think, on the back end of this for the repayment 
of this. There are some businesses who are not having their 
employees come back due to no fault of their own, and I think 
we need to give them due deference on that. They are in good 
faith. We can separate the ones that aren't. But the ones that 
are doing what we hoped and intended ought to be given that.
    So delighted to work with you. Thank you for your 
partnership and the opportunity to speak today, and I thank you 
for all your work. I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    The gentleman from Virginia, Mr. Griffith, is recognized 
for 2 minutes.

 STATEMENT OF THE HON. H. MORGAN GRIFFITH, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF VIRGINIA

    Mr. GRIFFITH. Thank you so much for holding this hearing 
today. Small businesses throughout the country have seen their 
revenues become nonexistent in a matter of days due to stay-at-
home orders meant to stop the spread of the coronavirus. The 
Paycheck Protection Program has allowed many small businesses 
to stay afloat and mitigate some of these layoffs and revenue 
losses. Though there were some technical problems early on, I 
was surprised at how quickly Treasury and the SBA were able to 
move. By April 11th, I was hearing from businesses across my 
district that they were getting the funds that they had applied 
for.
    The Economic Injury Disaster Loan Program has not been 
nearly as successful, even though in the first aid package that 
Congress passed in late February we added additional money to 
help fund that program. I have heard numerous complaints from 
small businesses in my district over the past 2 months who have 
yet to receive those funds, and they don't know the status of 
their applications. I would urge the Committee to investigate 
the reasons for SBA's delay on this program. I would also urge 
the Committee to assess the feasibility of having banks, credit 
unions, and small community lenders carry out the EIDL program 
as well as PPP.
    While the PPP loan program has been a success, I am afraid 
it could be a bridge to nowhere. While many businesses have 
been able to keep their employees and to stay open, without at 
least beginning to reopen our economy before the end of the 8-
week period, the bridge that Congress has provided will 
collapse or leave our businesses out on the end of the bridge 
with nowhere to go. These business owners will once again have 
the sad duty of laying off those same employees and, in many 
cases, closing their doors forever.
    And just a few examples were my district where I have been 
out and about, the guy who does the oil change on my car says 
that his business is only 45 percent of what it was before. One 
of the local fast food restaurants has lines in the drive-
through way back. Even though it looks like they are being 
successful, their business is off by 55 percent.
    So I would have to agree with my colleagues who have asked 
for some flexibility on that repayment, and I would also have 
to say that, while those things are happening and some things 
have been pushed off, the real estate taxes, the personal 
property taxes, the business license taxes all are going to 
have to be paid at some point, and yet these businesses don't 
have the revenues that they anticipated.
    I yield back. Thank you so much.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    We recognize the gentleman from New Jersey, Mr. Malinowski, 
for 2 minutes.

   STATEMENT OF THE HON. TOM MALINOWSKI, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF NEW JERSEY

    Mr. MALINOWSKI. Thank you, Chairwoman Velazquez, Ranking 
Member Chabot, for the opportunity to testify about the 
Paycheck Protection Program. The PPP is an important, necessary 
program to keep businesses alive and employees on the payroll, 
but I don't need to tell you that the rollout of this program 
in many parts of the country has been a disaster. I have been 
in close touch with small business owners in my district, and 
it is difficult to fully capture the level of fear, 
frustration, and uncertainty that they are feeling right now. 
They are also just plain ticked off when they read that a 
national steakhouse chain made off with $20 million, that 
favored bank customers who didn't need help nearly as much as 
they did got concierge service while they wait on hold for 
hours, day after day, hoping for some small piece of news.
    I am delighted that we are setting aside money for 
community banks now, but I am livid that the Senate and the 
administration refused to consider a single change to the 
program to ensure that banks treat all of their customers with 
equal respect. I am angry that some of us were accused of 
playing politics because we wanted to fix this program before 
punting more money into it. We all know it is going to need 
more money again soon, and I believe it should be fully funded 
for the duration of this crisis, but let's do better than that.
    Before we add more money to PPP, let's add rules that 
prevent big companies with access to other capital from 
gobbling up loans that should be going to truly small 
businesses. Let's create a dedicated pot of money for those 
truly small businesses so the bagel shop, the laundromat, the 
flower shop with four or five employees isn't competing against 
companies with 400 or 500. Let's add stronger eligibility 
requirements to ensure the program is only open to businesses 
actually at risk of going under.
    And I wish it went without saying, but big banks should not 
be writing the rules here. We should be. The banks have to be 
made to understand that they have been drafted just as soldiers 
in a war are drafted. For this purpose, they are agents of the 
American people, acting in our interest, not their own. And if 
that hasn't been made clear enough, it is on us to make it so.
    We are in the worst economic crisis since the Great 
Depression. How we respond will decide whether the economy of 
the early 2020s will look like that of the early 1930s. Small 
businesses are digging deep, and to do right by their 
employees, the rest of us need to step up and have their backs. 
Thank you, Madam Chair.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    The gentleman from South Dakota, Mr. Johnson, is recognized 
for 2 minutes.

   STATEMENT OF THE HON. DUSTY JOHNSON, A REPRESENTATIVE IN 
            CONGRESS FROM THE STATE OF SOUTH DAKOTA

    Mr. JOHNSON of South Dakota. Madam Chairman, Mr. Ranking 
Member, thank you.
    Of course, I also want to thank the 11,000 South Dakota 
businesses that participated in the PPP, the Paycheck 
Protection Program. Our recovery, which will take place over 
time, will be much more successful and will happen more rapidly 
because those businesses kept their employees on the payroll 
during this difficult time.
    Congress has done a number of things right, a lot of things 
right with our coronavirus response packages, but of course, we 
have not been perfect, and today I want to highlight two key 
areas where we still need to act.
    First, we have left too many organizations on the outside 
of PPP looking in, and so we need to adjust eligibility 
criteria so that cooperatives, small gaming operations, local 
hospitals with governmental affiliations, 501(c)(6) 
organizations, and franchises, that they too can keep their 
employees off the unemployment rolls. That will help this 
economy.
    Second, I cannot stress how important it is that we 
continue to get assistance to our agricultural producers. Farm 
and ranch country have been simply battered by a combination of 
unbelievable market volatility and steep price declines. Now, 
we have made some progress securing $23 billion for producers, 
but more funding is clearly, clearly needed. We also need to 
adjust payment limits and to provide flexibility to support 
producers who have no place to take their livestock because the 
processing plants in their area have been shuttered or 
drastically have reduced their capability.
    Those are the two most important issues that I wanted to 
talk about today, ma'am, but there are more that I have 
outlined in this letter to the Speaker and to the Republican 
leader, and I hope that it can be added to the record of 
today's proceeding.
    Thank you for this opportunity.
    Chairwoman VELAZQUEZ. Thank you. The gentleman yields back.
    Mr. Katko from New York, you are recognized for 2 minutes.

STATEMENT OF THE HON. JOHN KATKO, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF NEW YORK

    Mr. KATKO. Thank you, Madam Chair, and thank you all for 
being here today. I am here not to complain. I am here to say 
thank you on behalf of the many hundreds and probably thousands 
of small businesses in my district that have benefited from the 
PPP program.
    I want to thank the Committee for their bipartisan work in 
response to the COVID-19 pandemic. I want to commend the SBA 
and Treasury for their expeditious work to provide relief to 
America's small business community. Think about it: They 
distributed $250 billion in loans and grant support to small 
businesses before the Treasury was able to give $1,200 checks 
to people they knew where they were and where their accounts 
were. That is pretty remarkable, and I commend them for that.
    Over $20 billion in paycheck program loans have already 
been approved in New York State. Funds from the Economic Injury 
Disaster Loan program have begun to make their way out across 
the State, amounting to over $210 million in advance funds. 
That is fantastic. These programs have helped many small 
businesses in central New York to keep their doors open and 
their workers paid. I can't tell you how many businesses I have 
heard from, often calling up in an emotional state, saying: 
Thank you. You saved our jobs. You saved our business. I worked 
my whole life for this and hit this disaster, and were it not 
for this program, I would have shut my doors.
    That is working. That is what government is supposed to do: 
help out small businesses and get out of the way.
    And that is exactly what we are doing here.
    The Paycheck Protection Program and Healthcare Enhancement 
Act, Phase 3.5, is going to ensure that more small businesses 
in my district are able to obtain relief. I liken it to a race 
car at the beginning of the track, revving its engine. They are 
all ready to go; they are just waiting for us to get it across 
the finish line today, and we are going to do that. It provides 
an additional $310 billion for the Paycheck Protection Program 
to ensure more businesses can participate. It increases funding 
for the Economic Injury Disaster Loan program by $60 billion.
    I am also pleased that the legislation allows small and 
medium size farms, which are all over my district, to take 
advantage of this program, which it badly needed to do, and 
that was a well done adjustment by all of you. It provides $2.1 
billion to support the Small Business Administration as they 
work to administer these programs.
    Congress must work to ensure that the PPP remains available 
to struggling businesses going forward during this crisis. 
Additional funding will be necessary to continue providing 
relief and ensure that small businesses have confidence in the 
program. Additional work is needed to ensure that the program 
accurately reflects the payroll needs of all businesses. I am 
proud to advocate with Representative Angie Craig of Minnesota 
for additional flexibility for seasonal employees, which I 
think is very important.
    And, with that, Madam Chair, I yield back. Thank you.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    The gentleman from Pennsylvania, Mr. Fitzpatrick, is 
recognized for 2 minutes.

STATEMENT OF THE HON. BRIAN K. FITZPATRICK, A REPRESENTATIVE IN 
            CONGRESS FROM THE STATE OF PENNSYLVANIA

    Mr. FITZPATRICK. Thank you, Madam Chairwoman, and thank you 
to the Ranking Member as well.
    Madam Chair, I am going to cut right to the chase here. We 
all know what the issues are. The PPP was well intended, poorly 
executed. It clearly missed the mark. We are here today to put 
more money into the program. Clearly needed. There have got to 
be guardrails put up on this program that prevent what we have 
seen in Pennsylvania, which I am sure all my colleagues have 
seen, where anybody under 500 employees is all put in the same 
bucket regardless of whether they are a hedge fund owner or a 
brokerage firm that is down 10 percent revenue with no plan to 
lay off their employees. And at the same time, you have small 
mom-and-pop shops, pizza shop owners, owner-operated day care 
centers that have no access to capital, no cash flow, who are 
getting denied. That is not the congressional intent of the 
Paycheck Protection Program. We have got to fix it. We have got 
to include our nonprofit communities as well. We all know what 
we need to do here. Let's fix this because this is a make-or-
break moment for our country.
    Second, Madam Chair, is a topic that Madam Chairwoman 
raised regarding business interruption insurance. I signed onto 
a letter along with this Committee. I used to be a member of 
this Committee as well. We have two choices going forward. God 
forbid, we are down this path. We either choose the path of 
government bailouts, or we create an insurance product. Right 
after 9/11, we created the TRIA program, which made all the 
sense in the world. It was market priced. It was risk based. 
And it was federally backstopped. There are a lot of industry 
tradespeople out there that are trying to say that this is not 
their problem. They don't want to be a part of the solution. 
They have to be part of solution. We can create a product where 
they can make money that insures our small businesses because, 
Madam Chairwoman, there are now small banks in our community 
that are now telling small businesses they will no longer 
extend lines of credit and financing unless they can show some 
level of insurance. That has got to be the solution going 
forward. These bailouts are inefficient. They miss the target. 
They result in endless deficits and the endless printing of 
money, and they miss the mark as PPP has. We can fix it. Let's 
work together with the Treasury Department to make sure that 
those guardrails are set up so that we protect our mom-and-pop 
small businesses and not give these loans out to people that 
don't need them.
    Madam Chair, I yield back.
    Chairwoman VELAZQUEZ. Thank you. The gentleman yields back.
    The gentlelady from Washington, Ms. Schrier, you are 
recognized for 2 minutes.

STATEMENT OF THE HON. KIM SCHRIER, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF WASHINGTON

    Ms. SCHRIER. Thank you, Chairwoman Velazquez, and Ranking 
Member Chabot, for holding this hearing. The Paycheck 
Protection Program is extremely popular based on the demand 
that we are seeing. And for the livelihood of small businesses 
and nonprofits, it is imperative, as you have heard many times, 
that we get its implementation right. We can't punish the 
smallest businesses just because they don't have longstanding 
lending relationships with banks. We need automatic triggers so 
the loans and forgiveness will renew if this economic strain 
persists far longer than we anticipated and businesses need to 
keep their idle employees on payroll for more than 8 weeks. 
Otherwise, their employees will just end up on unemployment 8 
weeks later.
    The lack of detailed guidance from the administration about 
requirements for PPP loan forgiveness puts small businesses in 
challenging positions when they have to make decisions at a 
moment about payroll, leases, and work orders. My constituents 
have expressed concerns about banks not honoring the first 
come, first served ethos. I have heard from several businesses 
that their PPP application goes unanswered by their bank while 
larger customers are actively courted and have their 
applications approved quickly. I realize these are anecdotes, 
and we will know more when we have good oversight, but many 
businesses who act quickly and do everything right are still 
getting overlooked by their banks.
    Now, there are restaurant owners in Auburn who haven't 
heard about their EIDL application. Cashmere Mountain Bed & 
Breakfast in Leavenworth, Washington, applied for a PPP loan on 
the first possible day and used their local bank. They haven't 
yet received a loan or a word. Their business averages $80,000 
per year and has just two employees, and they have been left 
out.
    I am hopeful that struggling businesses will get help with 
the passage of today's PPP and Healthcare Enhancement Act. The 
set-aside for funds to be distributed through small local banks 
should help, but as you continue to consider changes to the 
PPP, we want to make sure the little restaurant owner and the 
bed and breakfast owner are taken care of. Thank you very much.
    Chairwoman VELAZQUEZ. Thank you. The gentlelady yields 
back.
    At this time, the Committee is going to take a short 5-
minute break. The Committee stands in recess.
    [Recess.]
    Mr. EVANS. [Presiding.] The Committee will come back to 
order. We will resume with members' testimony, starting with 
Mr. Phillips of Minnesota, who is recognized for 2 minutes.

   STATEMENT OF THE HON. DEAN PHILLIPS, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MINNESOTA

    Mr. PHILLIPS. Thank you, Mr. Evans, and as a small business 
owner myself, I am grateful to all of you for the important 
work you do on behalf of small businesses. In a couple of 
hours, I will be voting to inject another $310 billion into our 
exhausted small business relief programs, but I do so with 
serious reservations. While the need is as real as it is 
urgent, the programs simply are not working as intended. Far 
too many small businesses in my district and throughout the 
country have not been able to access the PPP or EIDL programs 
even as they face the real prospect of having to close their 
doors for good.
    Once again, I am afraid a Federal program designed to 
support every business is benefiting those which need it the 
least at the expense of those which need it the most. Take 
independent restaurants, cafes, bars, and clubs, for example, 
the quintessential community small businesses without which no 
American town would ever be the same. Most are now shut down, 
and many are being shut out. Take Jason, the owner of Monie's 
Bar and Grill in small but might by Maple Plain, Minnesota. PPP 
did not work for him due to the 75/25 rule, the 8-week window, 
and other challenges with the covenants. So he applied for an 
EIDL loan on April 8th, over 2 weeks ago, and what did he hear 
back? Crickets. Not even an acknowledgment of receipt of his 
application. You could say that Monie's couldn't get the money.
    Now, there are thousands of businesses in my district that 
have benefited from PPP and EIDL loans, and I am grateful for 
that, but there are thousands more who have been shut out and 
need our help now. It will not matter how much money we throw 
at the problem if the system by which it is distributed is 
inaccessible to businesses who need it the most. My recent 
letter to Treasury Secretary Steve Mnuchin proposes much-needed 
commonsense changes, and I submit it for the record.
    Despite these challenges, I do remain hopeful. And this 
bill, while imperfect, will surely help more people, but our 
job is not done. We must fix what is broken and ensure that 
intensive oversight and accountability is present where the 
money flows and where it goes. And to the small businesses of 
our country, I say: Keep the faith because help is on the way.
    Thank you, Mr. Chair.
    Mr. EVANS. Mr. Keller of Pennsylvania.

STATEMENT OF THE HON. FRED KELLER, A REPRESENTATIVE IN CONGRESS 
                 FROM THE STATE OF PENNSYLVANIA

    Mr. KELLER. Thank you, and I appreciate the opportunity to 
talk about how the provisions of the PPP and the CARES Act have 
positively impacted the businesses in Pennsylvania's 12th 
Congressional District. In the first round of PPP funding, 
Pennsylvania had nearly 70,000 small businesses take advantage 
of the program. These businesses received a combined total of 
$15 billion in loans. Similarly, 700 Pennsylvania small 
businesses have received loans through the SBA's EIDL program 
for over $138 million.
    The Paycheck Protection Program and the EIDL have been 
important and successful programs in keeping small businesses 
open and people hired during this pandemic. Every dollar used 
in these programs to keep businesses operating and people 
employed is a dollar invested in our economic recovery and also 
a dollar not spent on unemployment.
    I can talk from experience with talking to people in my 
district that there has been robust interest in the small 
business components of our COVID-19 response in Pennsylvania's 
12th. Recently, our office facilitated a successful call 
between small businesses and banks in our district and regional 
officials from the U.S. Small Business Administration. The 
Small Business Administration, which had been a great resource 
throughout the process, answered questions for over an hour 
from small businesses and lenders. We had hundreds of people on 
the call and found that the information was helpful in their 
process for applying for small business relief.
    One of the persistent questions we have received is how 
these programs apply to our agricultural community. While 
qualifying farms have been able to access paycheck protection 
benefits, I am glad to see language in H.R. 266 that will 
confirm EIDL benefits apply to qualifying farms.
    Small businesses employ nearly half of all Americans. They 
are the heart of our economy and will be a major player in our 
economic recovery. Many speak about finding a way to the new 
normal. At least as far as the economy is concerned, I hope we 
return to the old normal where the American worker built the 
greatest economy the world has ever seen.
    Thank you, and I yield back.
    Mr. EVANS. Mr. Schiff from California, you are recognized 
for 2 minutes.

   STATEMENT OF THE HON. ADAM B. SCHIFF, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. SCHIFF. Thank you, Madam Chair, Ranking Member Chabot, 
members of the Small Business Committee for the opportunity to 
provide feedback on this vitally important program passed as 
part of the CARES Act. I am pleased we are providing additional 
funding for SBA relief programs, but I am deeply concerned 
that, without further programmatic changes and further 
assistance, many small businesses will be forced to close 
permanently, causing enormous economic suffering and slowing 
our recovery.
    Many small businesses and nonprofits in my district are 
frustrated by the difficulty of getting help and finding a 
lender. They have been moved to the back of the line behind 
larger businesses with established relationships and feel 
forgotten. This is a particular issue, as we have seen in the 
recent New York Times report, for small businesses that are 
customers of very large banks but are not the favored customers 
of those banks. Congress must get to work funding those 
businesses, large and small, that need it. Small businesses 
that have seen their revenue cut to zero in weeks cannot 
survive much longer. They will close, and many will not come 
back. So I strongly urge the Committee and Congress to consider 
programmatic changes that ensure greater access to the PPP and 
EIDL programs but also how we go further to get help to the 
businesses and nonprofits that most need it.
    I am also puzzled why the first tranche of funding has been 
distributed inequitably among the States with California 
receiving one of the smallest per capita amounts. I ask the 
Committee to look into this disparity and make sure that SBA 
loans are distributed fairly.
    And, finally, I would ask the Committee to consider the 
interplay between the small business program and unemployment 
compensation. In discussions with local businesses, like the 
Tallyrand Restaurant in Burbank, many are having difficulty 
rehiring workers who are already laid off and on unemployment 
compensation. They want to participate in this program. They 
are required to rehire employees, but those employees have 
already gone on to the unemployment system. So, if we could 
consider how that interplay works and affects these small 
businesses, to make sure they keep their doors open.
    Finally, I would like to advocate for a broader vision in 
the next major relief package like a large payroll guarantee 
program that would be equitable for businesses large and small. 
It would be efficient. It would avoid layoffs and I think will 
be commensurate with the size of the economic challenge facing 
the country. So I thank you for your attention and your work on 
this, and I yield back.
    Mr. EVANS. Mr. Roe of Tennessee, you are recognized for 2 
minutes.

    STATEMENT OF THE HON. DAVID P. ROE, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF TENNESSEE

    Mr. ROE. I thank the Chair and the Ranking Member for 
holding this very important meeting. We have rolled out an 
amazing PPP plan in a very short period of time. With that 
said, any program like this is going to have a few hiccups, and 
there are three changes I would like to discuss today, 
basically.
    One is to encourage the SBA to allow lenders the discretion 
to offer loans to companies in Chapter 11. We have a newspaper 
business in my district that has a strong underlying book of 
business, but the structural changes in the news industry has 
left it saddled with some debt. Before the crisis, they were on 
track to reopen, but now the business is not sure it can 
survive. I think by asking lenders to review the underlying 
business and ensure that it is in a strong position can save 
many businesses.
    Number two, I would like to encourage this, specifically to 
allow medical practices that have more than 500 employees but 
less than 500 at its individual practice locations to be 
afforded the same PPP loans as the hospitality industry and 
restaurants. In fact, CMS actually requires medical practices 
to submit applications to qualify for an accountable care 
organization by each practice location. And the SBA wants to 
look at the total number of people working there, and this 
makes no sense. Absent this action, there won't be a private 
practice of medicine, I am afraid. My practice has been there 
for 50 years, and for the first time ever, we laid off a third 
of our employees.
    And, lastly, I want to encourage the Committee to start 
considering a different start date for the loan forgiveness. In 
Sevier County, Tennessee, where Dollywood is, there is a lot of 
entertainment. This goes across the country. And if you have, 
let's say, a Comedy Barn, and you use this program, there is 
nobody there because the Governor has shut that down. We can't 
open it. So it would really help these businesses, when the 
Governor gives his okay in our State to open these businesses 
back up, that the clock then starts for the 8-week loan 
forgiveness.
    I appreciate very much the opportunity to speak today, and 
I yield back the balance of my time.
    Mr. EVANS. Mr. Rose of New York, you are recognized for 2 
minutes.

 STATEMENT OF THE HON. MAX ROSE, A REPRESENTATIVE IN CONGRESS 
                   FROM THE STATE OF NEW YORK

    Mr. ROSE. Thank you very much for your time.
    Thank you, Chairwoman Velazquez, Ranking Member Chabot, for 
having us here today and for your leadership for New York City 
businesses, Chairwoman, especially.
    I commend this Committee's amazing work in establishing 
both the PPP and EIDL programs, two unprecedented programs that 
have seen unprecedented demand demonstrate how responsive 
government should work when confronting national crises.
    As you all know, true small businesses are facing 
absolutely immense challenges accessing these programs, 
challenges made worse during the turmoil and uncertainty of 
this pandemic. Nowhere is that more so the cases than for 
businesses on Staten Island and south Brooklyn, two of the 
locations hardest hit by this virus in the entire world.
    Small businesses in my district need help. They cannot 
afford to wait. I come before this Committee to ask that you 
help these businesses by addressing the following issues: We 
can start by ensuring history does not repeat itself by letting 
the big banks prioritize the wealthiest clients while small 
businesses in my district wait for even a reply after 
submitting their application. By using prescriptive language in 
future relief bills, we must look out for the businesses who 
need help the most and make it harder for big corporations to 
use emergency relief funds to optimize their bottom line.
    We also have to look ahead. The banking industry estimates 
that this next tranche of money could last only a week or so. 
Based off what I am hearing from my district, I can't tell 
you--I can't tell my constituents with a straight face that 
they will be able to access these funds again when they--after 
this dries up. I was proud to see $60 billion put aside for 
State and Federal credit unions, micro lenders and such, but we 
need to do more for the nonprofit sector as well. Look. Plain 
and simple, more relief very well might be needed. This crisis 
is far from over.
    And I thank you again for all of your extraordinary 
leadership.
    Mr. EVANS. Ms. Slotkin of Michigan, you are recognized for 
2 minutes.

   STATEMENT OF THE HON. ELISSA SLOTKIN, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MICHIGAN

    Ms. SLOTKIN. Thank you. Mr. Chairman, Ranking Member 
Chabot, thank you for the opportunity to share the effects of 
the COVID-19 crisis on Michigan and Michigan's Eighth District.
    I consider the bill that we are going to vote on today as a 
must-pass piece of legislation. In Michigan, we have been 
deeply hard hit by this crisis. Only two States have lost more 
lives to COVID-19, and Michigan is a fraction of the size of 
those States. Our Governor, Gretchen Whitmer, has issued Stay 
Home, Stay Safe, designed to limit the spread of the virus. And 
that has unquestionably saved lives, but it comes at a real 
cost to our economy. Small businesses, retail shops and cafes, 
brew pubs, restaurants, greenhouses and lawn companies, hair 
salons, and machine shops, they have had to close and sharply 
reduce their business activity in order to keep their workers 
and their customers safe.
    In response, we have tried to do anything we can to get 
those business owners a scrap of information in this process, 
and I thank you all for doing such wonderful work to keep 
people informed. We have held virtual summits with businesses, 
done Facebook Live events in the Detroit and Lansing areas. 
Main Street businesses across the district are eager for any 
news. In that environment, the passage of the PPP program, 
Paycheck Protection Program, was absolutely necessary, and 
replenishing it today is as well.
    Let me share what I have heard from some of our businesses. 
In Brighton, a receipt of a PPP loan means the Work Skills 
Corporation can continue programs that last year placed 1,200 
people in jobs providing services to our most vulnerable 
residents. The Cookies and Cream Ice Cream Shop in Lake Orion 
got a PPP loan and were able to keep nine seasonal employees on 
the payroll, preparing for their springtime opening. In 
Rochester Hills, PPP helped keep Dutton Farms alive so it can 
continue to provide economic opportunities for the 
developmentally disabled. And in Lansing, our very beloved 
minor league baseball team, the Lugnuts, is better equipped to 
weather the storm and bring us that summertime joy.
    And I thank you for passing this legislation. I thank you 
for proposing it and for allowing our smallest businesses to 
benefit this time around. Thanks so much.
    Mr. EVANS. Thank you.
    Ms. Sherrill of New Jersey, you have 2 minutes.

   STATEMENT OF THE HON. MIKIE SHERRILL, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF NEW JERSEY

    Ms. SHERRILL. Thank you. Thank you to Chairwoman Velazquez, 
to Acting Chair Evans, and Ranking Member Chabot and the 
Subcommittee for this opportunity.
    Thank you to my colleague, Representative Kim, for 
advancing New Jersey's priorities on this Subcommittee.
    As many of you know, New Jersey is one of the hardest-hit 
States in the Nation. Along with New York, we account for 45 
percent of the cases nationwide. So I am grateful for the 
Committee's work in helping our struggling small businesses 
face this unprecedented pandemic. I testify today for New 
Jersey's small businesses and towns as we continue to develop 
future stimulus packages.
    I want to highlight two key issues I am seeing in New 
Jersey. First, additional funds to the Paycheck Protection 
Program is only the first step. We must take the lessons 
learned and apply them now. I hear from companies daily: a 
Nutley Florist who cannot find a lender, an engraving store in 
Little Falls who cannot find out the status of their loan, a 
yoga studio in Verona whose bank stopped taking applications, 
and the list goes on.
    It is not sufficient to nearly add more funding. We must 
make it easier for businesses to access these funds and live up 
to the intention of the program we created. The $10,000 EIDL 
grants promised within 3 days are now only marginally 
available, devastating small businesses in NJ-11 and 
demoralizing owners who are fighting to take care of their 
employees.
    Second, we must ensure direct funding for smaller towns and 
counties. The CARES Act took the first step of providing 
funding for States and larger localities but ignored counties 
like Morris in my district, which falls just under the 
population threshold to qualify for the funds. For more rural 
Sussex County, COVID challenges are still resource intensive. 
Direct funding is critical to keep the fight up for our 
constituents. We must rectify this. We must support our county 
officials and mayors as they face unexpected budget shortfalls 
through no fault of their own on top of the COVID-19 crisis.
    Local electeds from towns like Hopatcong and Chatham 
Township are incredibly concerned about revenue loss from 
sources like construction permits, which had already dropped 
because of the SALT deduction cap and an inability of residents 
to pay property taxes.
    So thank you for this opportunity. I look forward to 
working with you on a bipartisan basis as we move forward on 
critical legislation. Thank you very much.
    Mr. EVANS. Thank you.
    Mr. Womack of Arkansas, you are recognized for 2 minutes.

    STATEMENT OF THE HON. STEVE WOMACK, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF ARKANSAS

    Mr. WOMACK. Thank you, Acting Chairman Evans, and to my 
colleague, Mr. Chabot, for your leadership and to have the 
opportunity here to be heard today at this hearing.
    I come today pretty much with my Ranking Member of the 
Budget Committee hat on. I will save the specifics for what I 
think could happen to the small business piece of the act that 
we have passed and what we are considering today and talk a 
little more generally about where we are as a country fiscally.
    No doubt the coronavirus is a challenge unlike anything we 
have faced before. I think we would all agree that this 
pandemic has impacted every facet of our life and our economy. 
Our response, just as this situation, has been unprecedented. 
We acted swiftly to help families and businesses across the 
Nation. It was the right thing to do. Between the CARES Act, 
the Families First Act, we delivered immediate relief to 
support medical workers and hospitals, helped families and 
workers, and stabilized the economy to the best of our ability. 
With no template on how to navigate these times, the goal was 
to make resources immediately available, and we did. There is 
no doubt that these efforts delivered assistance. For example, 
Arkansas alone saw 21,000 PPP loans administered, totaling $2.7 
billion, to help the small businesses in Arkansas and keep 
workers on the payroll.
    However, our continued response must be focused on doing 
what is necessary, not what is wanted. We must ensure our 
efforts are targeted to help the needy, not prop up the 
opportunistic. Discussions about another high-dollar 
legislative package are already underway and even though the 
full effects of this crisis nor the impact of the bills we have 
already had signed into law are fully known. May I remind my 
colleagues that, before anyone had heard of COVID-19, this 
Nation was on track to overspend itself by more than a trillion 
dollars.
    I believe it is important to address the needs of our 
Nation, but I also believe it has to be done in a very 
responsible way. We have to be targeted. It has to be 
temporary. And it must be transparent. The insatiable appetite 
to throw a lot more money at the problem must be constrained.
    With that, Mr. Acting Chairman, I yield back the balance of 
my time.
    Mr. EVANS. Thank you.
    Mr. Horsford of Nevada, you are recognized for 2 minutes.

  STATEMENT OF THE HON. STEVEN HORSFORD, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF NEVADA

    Mr. HORSFORD. I want to thank the acting Chairman--it is 
great to see you in that role--and to the Ranking Member, Mr. 
Chabot, and members of the Small Business Committee and to the 
staff for keeping us safe.
    I want to thank you for allowing me to address an issue 
that is important to my State of Nevada but also that affects 
some 43 other States in our country.
    The gaming industry is vital to local small businesses. It 
supports more than 350,000 small business jobs and delivers $52 
billion annually in small business revenue, including 
construction, manufacturing, retail, and wholesale firms. In 
many States, especially in my State of Nevada, gaming pays a 
significant share and contributes significantly to State 
budgets with more than $10.7 billion in gaming taxes and Tribal 
revenue.
    However, in light of COVID-19, commercial and Tribal casino 
operators have been forced to close their doors. And while many 
small businesses are able to participate in the Paycheck 
Protection Program, which we have provided now $660 billion in 
relief, the SBA has used unfair and, I would say, 
discriminatory guidance and has stated that small businesses 
that have a portion of gaming revenue are to be precluded from 
receiving any of these funds. This is outrageous. Nevada 
currently is ranked 43rd out of 50 States in the amount of 
money that we have received from PPP. We have over 8,700 
businesses who have been funded with the loan, but 
disproportionately restaurants, small taverns, and other local 
businesses are not even eligible to apply, and, therefore, 
Nevada is being left out. On top of that, my minority-, women-, 
and veteran-owned businesses have not gotten an equal share of 
the funding either.
    So, while I am voting for this bill today, I am calling on 
this Committee to join with me and members of our delegation to 
fix this issue that prohibits gaming companies from getting 
their share of the money. And I am asking you, Mr. Chairman, to 
work with us as we address this issue, not just for Nevada but 
for all of the United States.
    Thank you, and I yield back.
    Mr. EVANS. Mr. Tipton of Colorado, you are recognized for 2 
minutes.

  STATEMENT OF THE HON. SCOTT R. TIPTON, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF COLORADO

    Mr. TIPTON. Thank you, Ranking Chair Evans, and my 
colleague, Ranking Member Chabot, for the opportunity to be 
able to address Small Business Committee. We would like to echo 
some of the same comments that were made by my colleague in 
regard to making sure that we know where the dollars are going 
and showing some fiscal restraint as well.
    However, in Colorado, healthcare workers and officials have 
responded admirably to the COVID-19 crisis, but there are a few 
easily resolvable issues on the business side that could help 
maximize Colorado's healthcare response. Many of our rural 
hospitals in Colorado are in a unique situation of being 
partially owned by the county and the district under State 
laws. While they function like nonprofits, their ownership 
structure has created confusion about whether they are eligible 
for the PPP as the Small Business Act prohibits government-
owned entities from accessing Small Business Administration 
loans. I have written to the SBA to be able to seek 
clarification on this issue and was told by the 
administration's liaisons that they are working on it. 
Meanwhile, I have heard from at least two rural hospitals in my 
district that were approved for PPP loans and received funds 
but who have subsequently been cautioned by their attorneys 
against using those funds in the event that they are deemed 
ineligible for the PPP program.
    Rural hospitals operate on an extremely thin margin, and 
the PPP would be a lifeline for many of them. Unfortunately, 
because there has been a lack of clear guidance from the SBA, 
and the interim funding package was silent on the issue, county 
and district-owned hospitals are in limbo. We need to clarify 
this issue now because we need clarity on it now. We cannot 
afford to lose rural hospitals and to have them close their 
doors in the midst of this pandemic. I would like to ask this 
Committee, Treasury, and the SBA to take up these concerns and 
to come together to resolve this issue for rural hospitals and 
the many, many Coloradans who rely on them. Thank you for this 
time.
    Mr. EVANS. Thank you.
    Ms. Stevens of Michigan, you are recognized for 2 minutes.

  STATEMENT OF THE HON. HALEY M. STEVENS, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MICHIGAN

    Ms. STEVENS. Thank you, Acting Chair Evans and Ranking 
Member Chabot and members of this distinguished Committee. 
Thank you for the opportunity to testify and for your continued 
leadership to our country's impeded economy and to our 
struggling small businesses in the face of a public health 
crisis to the likes our Nation has never seen.
    In Michigan, I am working around the clock with small 
businesses and the 25 beautiful towns I have the privilege of 
representing, comprised of beautiful downtowns with 
restaurants, gyms, hotels, mom-and-pop shops, sandwich stores, 
and people who came to this great Nation to build these 
businesses; people who grew up in my communities, who were born 
here, who graduated from West Bloomfield High School, from 
Waterford Kettering, from Churchill High School; people who 
have given it all to achieve the American Dream; people like my 
parents, who are small business owners.
    We must, my friends, orient our policymaking towards long-
term economic viability in our new scientific reality. We are 
not as in charge as we would like, but I am optimistic. I have 
hope. We must evolve and truly reckon with the task at hand for 
the health outcomes oriented towards the science, for the 
economic viability, for our workers, and their employees.
    We cannot feign the revenue loss for businesses. We do not 
intend to feign revenue loss for businesses. We must achieve 
standardized health guidelines for the operation of our cities, 
for our enterprises, the employers in our cities, and the very 
functions of society. We will learn, we will evolve, and we 
will continue to prevail.
    I am grateful for my credentials as a former Treasury 
official during the last financial crisis, and I worked closely 
on the State Small Business Jobs Act of 2010.
    Many Michigan businesses have shared obstacles to accessing 
the Payment Protection Program funds, from the lack of guidance 
and oversight for lenders, to the lack of transparency in 
distribution. Many businesses will be dealing with the impacts 
of the pandemic for years, and we will not be successful 
without additional flexibilities.
    I remain committed to you, Mr. Chairman, and to this 
Committee as we move forward for the health and success of our 
overall economy.
    Thank you.
    Mr. EVANS. Mr. Roy of Texas, you are recognized for 2 
minutes.

 STATEMENT OF THE HON. CHIP ROY, A REPRESENTATIVE IN CONGRESS 
                    FROM THE STATE OF TEXAS

    Mr. ROY. I thank the Chair.
    Twenty-six million unemployed Americans; 43 percent of 
American families have had a reduction in their paycheck or an 
elimination of their paycheck. I would posit that what we are 
doing is not working.
    We have met twice. We have spent $2 trillion, and now are 
throwing another $460 billion, whatever the number is, at it. 
And I am going to hold my nose and vote for the bill today 
because there are 700,000 businesses on the outside looking in 
hoping to get some capital to keep the jobs afloat and to keep 
the businesses they inherited or built alive.
    But we have got to change our approach. We have got to get 
our businesses back up and running. We have got to restart our 
economy. We can't fund our economy from Washington. We have got 
to get people back to work. And, if we are going to continue to 
have programs, they need to actually function.
    As many of my colleagues previously have talked about, I 
think my friend, Mr. Phillips, I think, who spoke a little bit 
earlier, about the extent to which the PPP program isn't 
functioning the way it needs to to work. And the combination of 
the unemployment insurance program where we are paying people 
more to not work than to work is fundamentally undermining the 
ability of businesses to get the benefit of a forgivable loan 
that requires them being able to go back and rehire people.
    This is not the way for us to do business. And Congress is 
going to have to meet, we should be here every single day until 
America is back, because we can't allow the 75 percent 
requirement, the 8-week requirement, the 2-year repaid loans. 
We are asking businesses to take a gamble, to go borrow money, 
to start paying back their loan in 6 months, feeling like they 
have got to repay it in 2 years, hoping that they will get it 
forgiven, to rehire people they can't rehire because of 
unemployment insurance is paying people more not to work than 
to work. That is not a way to do business.
    Mr. Chairman, I hope we can do better, and we should be 
meeting regularly to fix this problem.
    Thank you, sir.
    Mr. EVANS. Thank you.
    Mr. Thompson of California, you are recognized for 2 
minutes.

   STATEMENT OF THE HON. MIKE THOMPSON, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. THOMPSON of California. Thank you, Mr. Evans.
    I am concerned about reports regarding the small businesses 
unable to access relief enacted under the CARES Act.
    Mr. EVANS. Can we--your microphone. Can you start over?
    Mr. THOMPSON of California. It shows red. Is it on?
    Mr. EVANS. It should be on now, yeah.
    Mr. THOMPSON of California. I am concerned about the 
inability of businesses to access relief that we passed and 
provided for under the CARES Act. Like other Members, I have 
received many desperate calls from small business owners who 
have encountered major difficulties applying for the Paycheck 
Protection Program and the Economic Injury Disaster Loan 
Program.
    These programs were to help businesses survive and save the 
jobs of their employees. This is, in part, because some 
mainstream banks are prioritizing their well-heeled clients 
ahead of mom-and-pop businesses who need the assistance the 
most.
    In my district, for example, one business owner applied to 
10 banks. Another owner applied at four banks and finally 
received a $200,000 loan from a bank in North Dakota. My 
district is in California. And they got that loan because they 
called in a favor from a friend who got the loan moved to the 
top of the list.
    One constituent with a 42-year very positive existing 
relationship was passed over.
    These stories show that, even with an existing relationship 
with a bank, some folks are left out in the cold. Large 
corporations, like Potbelly and Ruth Chris, which are highly 
capitalized, received funding that accelerated the depletion of 
critical SBA loan relief.
    Small businesses were not getting access to loans, and many 
have been unable to apply before the first batch of funding ran 
out. They must lose--they may lose their businesses, and their 
employees, our priority for passing this bill, will be out of a 
job.
    I respectfully urge this Committee in the next legislation 
to close the corporate loopholes that place large businesses 
above the small businesses in the PPP, and reexamine the way in 
which PPP reimburses banks to ensure that they don't cherry 
pick loans that they process. And I respectfully ask that 
eligibility for the PPP be extended to 501(c)(6) organizations.
    Thank you for your time.
    Mr. EVANS. Thank you.
    Mr. Thompson of Pennsylvania, you are recognized for 2 
minutes.

   STATEMENT OF THE HON. GLENN THOMPSON, A REPRESENTATIVE IN 
            CONGRESS FROM THE STATE OF PENNSYLVANIA

    Mr. THOMPSON of Pennsylvania. Mr. Evans, thank you so much. 
And thank you to the Chair, Ranking Member, and all the members 
of the House Committee on Small Business. I want to thank you 
for the opportunity to share feedback from small business 
owners and lenders from Pennsylvania's 15th Congressional 
District.
    I am grateful for the SBA's work in recent weeks to 
implement PPP and deliver relief directly to millions of small 
businesses and their employees. In this 2-week period, I have 
learned a lot working with small business owners. Many have 
expressed concern, as small rural banks are still in need of 
assistance as funds went out to many with prior relationships 
with the Small Business Administration.
    Many have voiced concerns with PPP loan forgiveness. 
Specifically, I have heard PPP lenders and borrowers expressing 
that current guidance needs to further account for real world 
contingencies.
    Some employers are concerned with former employees who may 
not return on payroll in a timely manner. Treasury states that, 
to qualify for forgiveness, the employer has until June 30 to 
restore employment and salary level for any changes made to 
staff and payroll. Employers have reached out to me personally 
voicing that, under the current economy, it is difficult to 
restore pre-pandemic employment.
    Second, some lenders and borrowers share the concern that 
75 percent of the total amount of a PPP loan must be used 
towards payroll costs for the loan to be forgiven completely. 
This has caused confusion for some business owners who borrowed 
2.5 multiple over the payroll costs for the PPP interim final 
rule from the Treasury. Business owners are concerned that that 
may result in a failure to have the loans forgiven.
    Finally, I am appreciative of the support provided by CARES 
for our Nation's farmers and ranchers through USDA and SBA. 
Many have struggled mightily in the past decade as prices have 
been challenging and average farm income was nearly halved.
    Just as prices began to rebound and trade negotiations 
improved, this pandemic started, devastating markets as 
restaurants and schools closed their doors. It is said that 54 
percent of all meals prior to this pandemic were eaten at 
restaurants, and people have now returned to the kitchen table.
    So I am pleased to see that today's legislation will ensure 
agriculture's eligibility for the Economic Injury Disaster 
Loans, and I thank you for your support.
    In conclusion, I want to thank the Chair, the Ranking 
Member, and the members of the Subcommittee for your continued 
dedication to our Nation's small businesses. I appreciate your 
consideration, and I look forward to working together in the 
future.
    Mr. EVANS. Thank you.
    Ms. Spanberger of Virginia, you are recognized for 2 
minutes.

       STATEMENT OF THE HON. ABIGAIL DAVIS SPANBERGER, A 
     REPRESENTATIVE IN CONGRESS FROM THE STATE OF VIRGINIA

    Ms. SPANBERGER. Good morning, and thank you to Chairwoman 
Velazquez and Ranking Member Chabot, and to you, Mr. Evans, for 
providing me with the opportunity to address the Small Business 
Committee today.
    According to the Small Business Administration, small 
businesses make up 99 percent of Virginia's businesses. These 
700,000 Virginia businesses are not just a statistic, a 
building, or a sign out front; they are the dreams of our 
neighbors.
    But, right now, across Virginia, COVID-19 has put these 
dreams in jeopardy. Yes, many businesses have found innovative 
ways to adapt to these challenging times, but, in conversation 
after conversation with business owners in my district, I have 
heard dire concerns about their livelihoods, their families, 
and their employees.
    Today, we are taking the right step in providing additional 
robust funding to the Paycheck Protection Program. I am the 
first to acknowledge that there have been issues with the 
implementation of the PPP, but I also know that, in this moment 
of crisis, this assistance is still desperately needed in 
central Virginia and throughout the country.
    Just last week, I spoke with a small business owner in my 
district who said PPP has been a, quote, ``godsend''--yes, that 
is the word he used--for his businesses and his employees. 
Others have called it a lifeline. It is not an overstatement to 
say that PPP funding is ensuring his business' very survival.
    Once we move forward with this additional PPP funding, we 
should also attempt to fix some of the major issues with the 
program, including that all eligible businesses, not just a 
bank's top customers, can get these loans.
    I also urge my colleagues to review the guidance that was 
put in place surrounding payroll costs in these forgivable 
loans. The so-called 75/25 rule was not passed by Congress in 
the CARES Act. It was not signed into law by President Trump. 
But, yet, the SBA and the Treasury Department added this 
guidance before Democrats and Republicans could express our 
deep reservation about this onerous requirement.
    The 75/25 rule has been overly restrictive on many 
businesses in my district, including restaurants. The 
implementation of PPP has been unfair to many American 
businesses, and rescinding this burdensome requirement would 
allow our businesses to use these loans to cover expenses 
related to their unique individual circumstances. It would 
level the playing field.
    And, while outside this committee's jurisdiction, I also 
want to mention two additional items that we must include in 
future iterations of coronavirus response legislation.
    Our next package must include additional funding for States 
and localities, including my rural counties in central 
Virginia, to address the challenges caused by decreased tax 
revenue. They need funding for law enforcement, they need 
funding for EMS, and they need funding to keep the lights on 
and the water running throughout our communities.
    We can't leave our rural communities behind. Our businesses 
need these local services to stay afloat and eventually to 
reopen their doors.
    And, to keep our rural businesses connected, we also need 
to push forward on additional funding for high-speed broadband 
internet in future response packages. I have been vocal about 
this issue since I arrived in the House, and central Virginia's 
rural communities need additional support to build reliable 
access to an increasingly online economy.
    Thank you again for holding today's hearing, and I look 
forward to working with you as we fight to preserve the 
businesses and to protect the workers that keep our communities 
strong.
    Thank you.
    Mr. EVANS. I would like to thank you, and thank Madam Chair 
and Ranking Members, all members of the Small Business 
Committee. If there are no other comments, I would like to 
conclude this hearing by once again thanking all my colleagues 
for being here today.
    I can hear the pain and frustration in your voice when you 
talk about the needs of our small firms, and I hear you and 
share many of the same concerns. Rest assured we will be doing 
all we can do to improve the PPP and ensure the money gets into 
the hands of the truly small and underserved businesses, their 
employees, who need it the most.
    I encourage you to work with my staff and the Republican 
colleagues as our priorities. And with unanimous consent, 
Members have 3 legislative days to submit statements and 
supporting material to the record. Without objection, it is so 
ordered.
    If there is no further business to come before the 
Committee, we are adjourned, and thank you very much.
    [Whereupon, at 1:30 p.m., the Committee was adjourned.]
    
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