[Senate Hearing 117-156]
[From the U.S. Government Publishing Office]




                                                        S. Hrg. 117-156
 
                       NOMINATION OF DILAWAR SYED
                     TO BE DEPUTY ADMINISTRATOR OF
                 THE U.S. SMALL BUSINESS ADMINISTRATION

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

                                HEARING

                               BEFORE THE

                      COMMITTEE ON SMALL BUSINESS
                          AND ENTREPRENEURSHIP

                                 of the

                          UNITED STATES SENATE

                    ONE HUNDRED SEVENTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             APRIL 21, 2021

                               __________

    Printed for the Committee on Small Business and Entrepreneurship
    
    
    
    
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        Available via the World Wide Web: http://www.govinfo.gov
        
        
        
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             U.S. GOVERNMENT PUBLISHING OFFICE 
 46-628PDF            WASHINGTON : 2022 
     
        
        
        
        
        
            COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP

                    ONE HUNDRED SEVENTEENTH CONGRESS

                              ----------                              
                 BENJAMIN L. CARDIN, Maryland, Chairman
                  RAND PAUL, Kentucky, Ranking Member
MARIA CANTWELL, Washington           MARCO RUBIO, Florida
JEANNE SHAHEEN, New Hampshire        JAMES E. RISCH, Idaho
EDWARD J. MARKEY, Massachusetts      TIM SCOTT, South Carolina
CORY A. BOOKER, New Jersey           JONI ERNST, Iowa
CHRISTOPHER A. COONS, Delaware       JAMES M. INHOFE, Oklahoma
MAZIE K. HIRONO, Hawaii              TODD YOUNG, Indiana
TAMMY DUCKWORTH, Illinois            JOHN KENNEDY, Louisiana
JACKY ROSEN, Nevada                  JOSH HAWLEY, Missouri
JOHN HICKENLOOPER, Colorado          ROGER MARSHALL, Kansas
                 Sean Moore, Democratic Staff Director
              William Henderson, Republican Staff Director
              
                            C O N T E N T S

                              ----------                              

                           Opening Statements

                                                                   Page

Cardin, Hon. Benjamin L., Chairman, a U.S. Senator from Maryland.     1
Paul, Hon. Rand, Ranking Member, a U.S. Senator from Kentucky....     4
Kaine, Hon. Tim, a U.S. Senator from Virginia....................    12

                                Witness

Syed, Mr. Dilawar, of California, Nominated to be Deputy 
  Administrator, U.S. Small Business Administration..............     5

          Alphabetical Listing and Appendix Material Submitted

Cardin, Hon. Benjamin L.
    Opening statement............................................     1
Kaine, Hon. Tim,
    Opening statement............................................    12
Paul, Hon. Rand
    Opening statement............................................     4
Syed, Mr. Dilawar
    Testimony....................................................     5
    Prepared statement...........................................     8
    Responses to questions submitted by Ranking Member Paul and 
      Senators Cantwell, Duckworth, Rosen, Rubio, Risch, and 
      Young......................................................    48
U.S. Chamber of Commerce
    Letter dated April 20, 2021..................................     3
U.S. Small Business Administration
    SBA Form 3501 COVID-19 Economic Injury Disaster Loan 
      Application................................................    18


                       NOMINATION OF DILAWAR SYED

                     TO BE DEPUTY ADMINISTRATOR OF

                 THE U.S. SMALL BUSINESS ADMINISTRATION

                              ----------                              


                       WEDNESDAY, APRIL 21, 2021

                      United States Senate,
                        Committee on Small Business
                                      and Entrepreneurship,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 2:40 p.m. via 
Webex and in Room 301, Russell Senate Office Building, Hon. Ben 
Cardin, Chairman of the Committee, presiding.
    Present: Senators Cardin, Cantwell, Shaheen, Booker, 
Hirono, Rosen, Paul, Scott, Ernst, Inhofe, Young, Hawley, and 
Marshall.

OPENING STATEMENT OF HON. BENJAMIN L. CARDIN, CHAIRMAN, A U.S. 
                     SENATOR FROM MARYLAND

    Chairman Cardin. The Small Business Committee will come to 
order.
    Let me acknowledge that Senator Paul and I saw Senator 
Kaine on the way in. He is here to introduce the nominee. He 
went over to cast his vote. As you know, the vote just started 
on the floor of the Senate. Senator Paul and I voted and came 
here. So we will interrupt where we are when Senator Kaine 
returns, to allow him to make his introductory remarks to our 
nominee.
    I want to recognize Dilawar Syed, our nominee for the 
Deputy SBA Administrator. Thank you very much for your 
willingness to serve our country during these extremely 
challenging times. It is not easy to serve in public life, just 
ask the members of the Senate right now. And it is not easy to 
take a position in the Executive Branch. So we appreciate your 
willingness.
    We know you are a successful businessperson so we thank you 
for this sacrifice. And we know it is not just your sacrifice, 
but a sacrifice of your family.
    Welcome to our committee.
    The Deputy Administrator of SBA is responsible for the day-
to-day management of the Agency, so this position is vital to 
SBA's success. And yet, this position has been vacant for the 
past three years due to the previous Administration's failure 
to put forward a nominee.
    Filling the position with a qualified nominee is more 
important than ever because Congress has tasked the SBA with 
tremendous responsibilities as part of the Federal Government's 
COVID-19 relief effort.
    In the past year, SBA's has delivered more than $970 
billion in aid to small businesses through the Paycheck 
Protection Program, EIDL, the EIDL Advance grants program, and 
the Small Business Debt Relief program. In the coming days and 
weeks, SBA will begin accepting applications for the $16 
billion Shuttered Venue Operators Grant program, as well as $28 
billion for the Restaurant Revitalization Fund. So we have a 
lot of activity that is taking place within the Small Business 
Administration.
    In total, Congress has charged SBA with distributing more 
than $1 trillion in COVID-19 small business aid, more than 10 
times the SBA's annual budget during the fiscal year before the 
pandemic.
    SBA must continue to be a lifeline to small businesses for 
the remainder of the pandemic and the Agency will be key to 
ensuring an equitable economic recovery.
    I am confident that Mr. Syed's experience as a business and 
civic leader has prepared him to lead SBA at this pivotal 
moment. Mr. Syed's decades of building and scaling companies 
will help SBA as it continues to implement new small business 
relief programs.
    SBA will also benefit from Mr. Syed's many years as an 
advocate for underserved entrepreneurs, including his service 
as Chair of the White House Initiative on the AAPI's Economic 
Growth Committee during the Obama administration; founder of 
the California Entrepreneurship Task Force; and leader of 
California's Rapid Response engagement with underserved small 
businesses during the pandemic.
    Because of Mr. Syed's broad experience and commitment to 
uplifting underserved entrepreneurs he has been endorsed by 
more than a dozen business organizations, including the 
National Association of Pacific Islanders, American Chamber of 
Commerce, Small Business Majority and the U.S. Black Chambers.
    Without objection, I will put the full list of the 
endorsements to the nominee into the record.
    [The information referred to follows:]
    
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    Chairman Cardin. The disproportionate impact of the COVID-
19 pandemic on minority-owned businesses has only highlighted 
the pervasive historic disparities in access to capital, 
technical training, and mentorship. That is why the Committee's 
top priority is improving SBA's program to better meet the 
needs of small businesses in Black, Latino, Asian, Native, 
rural, and other underserved communities to ensure an equitable 
recovery and prepare for future crises.
    Mr. Syed, if confirmed, we will need your insight into how 
to improve these programs. So I am asking for your commitment 
to operating SBA in a transparent manner and to maintain open 
lines of communication.
    I want to again thank you for stepping forward to serve our 
Nation during these very difficult, unprecedented times and I 
look forward to hearing your testimony.
    With that, let me turn it over to the ranking member, 
Senator Paul.

   OPENING STATEMENT OF HON. RAND PAUL, A U.S. SENATOR FROM 
                            KENTUCKY

    Senator Paul. Thank you, Mr. Chairman.
    I began my tenure as ranking member of this Committee by 
supporting Administrator Guzman's nomination in a good faith 
effort to establish an honest and transparent working 
relationship with the Biden administration and my colleagues 
across the aisle.
    It seems that this goodwill, though, is not being 
reciprocated. As we proceed with this hearing of the nomination 
of the Deputy Administrator of the SBA, as we began the process 
of vetting the nominee as required by the Committee rules, we 
became aware that Mr. Syed had applied for SBA's PPP and EIDL 
COVID relief programs on behalf of his company. He did not 
disclose this taxpayer assistance voluntarily. We found this 
information on our own, as part of our internal vetting 
process.
    Given that the position to which Mr. Syed has been 
nominated is responsible for overseeing all SBA programs, 
including the trillion dollars of taxpayer money Congress 
appropriate for small businesses, it is imperative that this 
Committee have complete information regarding any SBA programs 
Mr. Syed participated in.
    The Committee has a Constitutional obligation to evaluate 
nominees for Senate confirmed positions such as the one to 
which Mr. Syed has been nominated. Some would say that the 
failure of an SBA nominee to be transparent about taxpayer 
funded programs under this Committee's jurisdiction would be 
disqualifying in and of itself.
    I have made repeated requests for this information from 
both Mr. Syed and SBA. As of today, the Committee still does 
not have his complete information related to the SBA COVID-19 
loan applications that Mr. Syed signed on behalf of his 
company.
    Despite my request that the Committee not proceed with this 
hearing until it has received all of the requested information, 
here we are.
    I look forward to hearing from Mr. Syed. I still have an 
open mind on the nomination, but I hope that he will today 
provide some clarity and transparency on the information that 
has been repeatedly denied to the Committee. This is the only 
way we can allow the Committee to make a full and informed 
determination of his eligibility for the position so I hope we 
will get to some transparency today.
    Chairman Cardin. Thank you, Senator Paul.
    If I could ask Mr. Syed, if you would please rise and raise 
your right hand. We have a tradition in our Committee to swear 
in our witnesses that we have Senate confirmation with.
    Do you solemnly swear to tell the truth, the whole truth, 
and nothing but the truth, so help you God?
    Mr. Syed. I do.
    Chairman Cardin. You can have a seat.
    Should you be confirmed as administrator, are you willing 
to appear and testify before any duly constituted committee of 
Congress when requested to do so?
    Mr. Syed. I do.
    Chairman Cardin. Are you willing to provide such 
information as is requested by any such committee?
    Mr. Syed. I do.
    Chairman Cardin. Thank you.
    We will go to your opening statement right now but when 
Senator Kaine arrives, we might interrupt it to allow him an 
opportunity to properly introduce you to the Committee.
    So please excuse the informality here, but I think it is a 
better use of our time.

   STATEMENT OF DILAWAR SYED, OF CALIFORNIA, NOMINATED TO BE 
    DEPUTY ADMINISTRATOR, U.S. SMALL BUSINESS ADMINISTRATION

    Mr. Syed. Thank you, Chairman Cardin, Ranking Member Paul, 
and members of the Committee for the opportunity to appear here 
today.
    I am deeply honored to be nominated by President Biden to 
serve as Deputy Administrator of the Small Business 
Administration.
    America's 30 million small businesses are the lifeblood of 
our economy. SBA's mission of supporting these entrepreneurs is 
more critical today than at any point in its history.
    The economic challenge created by the COVID-19 pandemic has 
claimed millions of American livelihoods, and so many of its 
small businesses. In the wake of this crisis, we have a once-
in-a-lifetime opportunity to build a more supportive, 
equitable, and resilient environment for small business owners 
in every community across our great country.
    I am an entrepreneur who has navigated a company through 
these difficult times. During the past year, like many other 
small businesses, we have had to make critical decisions to 
save jobs and preserve livelihoods.
    I also know full well that there are many small businesses 
that have been impacted to a far greater degree. Entrepreneurs 
in Black and Brown communities, rural and underserved regions 
need our commitment and support more than ever.
    For over two decades, I have built early stage businesses 
and run companies in software, consumer, health care, and 
artificial intelligence. I am proud to have led teams that have 
built digital tools used by thousands of Main Street businesses 
across America. Today, I guide a team of scientists and 
engineers to help improve health outcomes. I have learned how 
to build passionate teams that tackle intractable challenges; 
how to foster an empowering culture; and how to create products 
that serve millions.
    While my business career has been gratifying, it is my work 
as a civic entrepreneur that I value most, and what has driven 
me to serve.
    My civic journey spans a decade of serving communities that 
have too often been left behind. I have spent time in Central 
Valley of California, Detroit, Philadelphia, and Atlanta 
advising entrepreneurs in regions that many people would fly 
over or drive through, but they are brimming with talent, 
promise, and aspiration.
    After the Great Recession, as a White House AAPI 
Commissioner I led engagement with Asian American entrepreneurs 
across the country, hosting listening sessions with small 
businesses, regional SBA teams, and resource partners.
    In my home State, which has over 4 million small 
businesses, I co-founded the California Entrepreneurship Task 
Force to bridge regions like the San Joaquin Valley with 
networks in Silicon Valley. I partnered with chambers of 
commerce, incubators, and universities to drive inclusive 
entrepreneurship and innovation in the rural heartland of our 
State.
    During the pandemic, I led a campaign to raise awareness of 
resources, including the Paycheck Protection Program, reaching 
more than 20,000 businesses. Our startup, like millions of 
small businesses, received critical help through the PPP and 
the EIDL programs. I am grateful for the assistance which 
allowed the company to keep all its employees, stabilize, and 
then repay the PPP and EIDL loans.
    During these challenging times, I saw firsthand the heart, 
skill, and resilience of our amazing team. Through it all, they 
persevered.
    I believe that my experience as a business leader and civic 
entrepreneur can help serve the SBA and all those who rely on 
it.
    If confirmed, I commit to leading the SBA--in partnership 
with Administrator Guzman and its committed public servants--
with urgency and purpose.
    I will provide hands-on leadership to continue 
implementation of COVID relief for small businesses and help 
rebuild those most affected by the pandemic.
    And I absolutely share Administrator Guzman's commitment to 
be transparent, accessible, and responsive to this Committee.
    I want to thank my family for their support in this 
endeavor. I am a proud dad and I know my wife and kids are 
watching. And I am really sorry that they could not be here 
today.
    In closing, I am an immigrant. I came to America 30 years 
ago as a young student in pursuit of education and opportunity. 
At that time, I never could have imagined that I would sit in 
this chamber with this committee having been called to serve by 
the President of the United States at this critical juncture. I 
am deeply humbled and honored.
    This moment calls me like it should call all of us, 
including those in the business world, to roll up our sleeves 
to build a better future.
    What we do next will matter for generations of Americans. I 
welcome this challenge and the opportunity to work alongside 
all of you.
    Thank you and I look forward to your questions.
    [The prepared statement of Mr. Syed follows:]
    
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    Chairman Cardin. Mr. Syed, thank you very much for your 
comments.
    We are now honored to be joined by our colleague from 
Virginia, Senator Kaine. Senator Kaine, welcome and we look 
forward to hearing from you.

   STATEMENT OF HON. TIM KAINE, A U.S. SENATOR FROM VIRGINIA

    Senator Kaine. To Chairman Cardin and Ranking Member Paul, 
thank you for the opportunity to speak a little bit out of 
order to this committee today.
    I am so honored to be here to introduce, you have already 
heard from him, but really to vouch for my friend, Dilawar 
Syed, who is an ethical and innovative businessperson but also 
has the heart of a public servant.
    Before I say a word about him, I do want to just 
congratulate the Committee and the members of the Committee. 
Like many of you, during the Easter recess, I spent time 
traveling around my State and spent a lot of time meeting with 
small businesses. And just a report from the road, here is what 
I heard again, and again, and again: it has been the toughest 
year of our entire business existence. To get through it, we 
have had to be incredibly creative and resilient and think of 
new ways of doing virtually everything. We could not have done 
it without loyal employees and our customer base rallying 
around us. And thank Congress, thank you to Congress for 
prioritizing the needs of small businesses, not only in 
programs like the Paycheck Protection Program and the EIDL loan 
program, but what I found that surprised me a little is 
virtually every local government that received CARES Act 
funding used a portion of that funding to help small businesses 
in their jurisdictions, maybe businesses that did not quality 
for CARES or that had opened during the pandemic and could not 
demonstrate lost revenue from the years before.
    So that is the first thing I just want to say to the 
Committee is that the work that you have done in CARES and now 
the American Recovery Plan is making a difference and I wanted 
to report that.
    The Small Business Administration plays a very important 
role in advocating for the backbone of the American economy. 
And in choosing administrators, choosing the leaders of the 
Small Business Administration, because of the critical nature 
of these businesses to the American economy, you want people 
with a particular skillset.
    Dilawar Syed, to me, his resume is just almost the job 
description of what you would want in a leadership position of 
this kind. He is an innovative, as he pointed out, American 
immigrant entrepreneur who has started not just one but 
multiple businesses in California.
    Interestingly enough, he has had the experience of a small 
business owner and the strains and stresses and anxieties of 
starting something and growing it. But his particular business 
is serving other businesses. That is what he does.
    And so it is a business that puts him in touch with other 
small businesses. That has given him significant insight into 
their challenges, as well.
    He has also had the advantage of working as a commissioner 
in the Obama administration and then in governmental and public 
service efforts in California to help small businesses.
    So to conclude, small business owner and innovator, serving 
other small businesses, and doing so in tandem with 
governmental agencies and philanthropies.
    He also mentioned in his opening statement that he, 
himself, had the experience of benefiting from actions of 
Congress, his own businesses, through the CARES Act and knows 
how those programs work and how they did not, and how future 
programs could work even better.
    He has much to offer the United States and I was so happy 
when I heard that President Biden had nominated him for the 
position and very happy to be here today to vouch for him.
    Chairman Cardin. Senator Kaine, thank you very much for 
that introduction. We always appreciate having you with us in 
this Committee, so thank you for your being here and we 
recognize that you have other obligations so thank you very 
much.
    Mr. Syed, I want to start the questioning. We are going to 
have 5 minute rounds based upon arrival from the members.
    I want to go into the point that you raised during your 
opening statement that Senator Paul has acknowledged during his 
opening statement. And that is that you, as the CEO of an early 
stage health care startup company in April 2020 applied for a 
PPP loan, an EIDL loan, and an EIDL Advance.
    My understanding is that your company received a loan, a 
PPP loan, in May of $563,513 and an EIDL loan of $67,500, and 
an EIDL Advance of $10,000.
    You have indicated in your testimony that that was 
essential in order to maintain your payroll. I believe your 
payroll was 24 employees at the time. Let me just ask you a 
couple of direct questions.
    When you applied for the PPP loan and the EIDL loan were 
you eligible to receive funding from those two programs?
    Mr. Syed. Thank you, Senator Cardin, for the question. The 
answer is yes.
    Chairman Cardin. Was that funding necessary for you in 
order to be able to maintain your payroll during that period of 
time?
    Mr. Syed. Yes.
    Chairman Cardin. Were the funds under the PPP program used 
principally for payroll?
    Mr. Syed. Exclusively.
    Chairman Cardin. Exclusively for payroll.
    And then, you were then able, as I understand it, to get 
outside financing in order to deal with your financial needs. I 
take it, if you were eligible, your revenues were less during 
COVID-19 than they were prior to COVID-19?
    Mr. Syed. Correct.
    Chairman Cardin. Then you made a decision to get outside 
financing and you made a decision to repay the PPP loan and the 
EIDL loan, if I understand correctly, in January 2021?
    Mr. Syed. That is correct.
    Chairman Cardin. Were you eligible for the loan forgiveness 
under the PPP program, considering that you used the money for 
payroll?
    Mr. Syed. Senator Cardin, I believe we obviously did not 
apply, we made a business decision to clear all our debt 
including the PPP and EIDL after raising a new round of 
funding. But based on where the money was spent, my 
understanding is we would have been eligible.
    Chairman Cardin. So why did you decide to repay the loan? 
After all, you have responsibilities to your company. You are 
entitled to have it forgiven, the PPP loan. Why did you decide 
to repay the PPP loan?
    Mr. Syed. Senator, we did not have the need. We believed 
that, having raised outside financing, at that point we made a 
business decision to clear all of our debt. And we considered 
the PPP and EIDL loan to be a debt. And we believed that that 
should be paid back and we made a business decision to pay back 
the loans.
    Chairman Cardin. I just want to compliment you on that. 
Obviously, you could have sought forgiveness and have been 
eligible for forgiveness under the terms that we set up. But 
you made a decision that, from the point of view of the 
appropriate judgment on the appropriateness of keeping the 
money that you felt better returning the money.
    I thank you. I am sure there are other businesses that are 
in your category but you are in the minority of the businesses 
in regards to the forgivable PPP loans.
    As the Deputy Administrator, you are going to be 
responsible for a lot of the administrative issues dealing with 
the implementation of these programs. I am going to just 
mention one as an example. In the most recent statute, the 
American Rescue Plan, we extended eligibility to PPP for local 
media companies. Part of that was to waive the affiliation 
rules and to use a size standard based upon per location. We 
have been informed that there has been a challenge in getting 
eligibility for the media companies because they have the same 
EIN numbers, which bounces it out from the application process 
even though they are eligible.
    My point to you in raising that example is that from day 
one we are going to need your attention to working in a very 
transparent way with us and the stakeholders to deal with the 
administrative challenges of implementing the PPP law. As you 
know, the administration changed the eligibility on the self-
employed. We have the larger non-profits that are now eligible. 
We are starting into the shuttered venue, certainly we will be 
in the restaurant program.
    All of that is going to require total transparency and 
working with us in a very close, open manner as you try to 
carry out congressional intent. We need to make sure that you 
will keep us totally informed and work with our offices.
    Do we have that commitment?
    Mr. Syed. Absolutely, Senator Cardin. And let me say that I 
think obviously the scale at which the SBA is operating and 
just the diverse set of programs it has to stand up, there is a 
lot going on. So if confirmed, I will partner with the 
Administrator to make sure that I am doing my best and also 
providing information as requested by this Committee.
    Chairman Cardin. And we have another bill passed. Senator 
Lankford has worked with several of us to clarify some of the 
provisions in the PPP. There is comparable legislation in the 
House that is now moving through the hotline. So there might be 
some additional challenges that we are going to throw on you 
and we would appreciate a very open process with you.
    The last one I am just going to raise, that you and I had a 
chance to talk about. Our highest priority is to make sure that 
our programs are targeted to the small businesses of greatest 
need, that we deal with the underserved community in the PPP 
program, the underbanked community, minority community, low-
income communities.
    Do we have your commitment to work with this Committee and 
members of this Committee as we look at the existing tools of 
the SBA to better target them to need as well as additional 
recommendations that have been made by members of this 
Committee, including myself, that deal with partnerships with 
the HBCUs, that deals with dealing with emerging markets, for 
minority small businesses getting access to venture capital, 
those types of programs. Will you work with us so that we can, 
in fact, live up to our commitment to serve all businesses in 
this country?
    Mr. Syed. Senator, absolutely I do, and a lot of my work 
that I have done in the underserved communities in rural parts 
of California, with communities of color, demonstrates my 
personal passion to focus on those communities. And so I 
absolutely will commit to doing this if I am confirmed.
    Chairman Cardin. Thank you very much.
    Senator Paul.
    Senator Paul. Mr. Syed, when you submitted your nominating 
materials to the Committee, you chose not to disclose that you 
had had PPP loans. That was found through our vetting of your 
candidacy but it was not voluntarily given to us. Since then, 
we have asked for more information and there has been some 
response but there has been an incomplete response.
    One of the specific questions we have asked and not yet got 
an answer for us the amount, in U.S. dollars, of the estimated 
loss that was required for one of the forms for the COVID-19 
Economic Injury Disaster Loan. What was the amount, in U.S. 
dollars, of estimated loss?
    Mr. Syed. Senator Paul, thank you for your question and let 
me first say, at the outset, I appreciate the importance of 
sharing of information that is necessary to confirm me and it 
is important, especially with this role of this agency at this 
time.
    With all due respect, I would like to clarify that I filled 
the questionnaire, the Senate questionnaire. When asked about 
whether the company had received COVID relief, this was 
supplemental information I provided, yes. So I have been 
transparent, forthcoming in sharing as various requests were 
made of me via the supplemental information that came in. And I 
think on multiple occasions I did that.
    The questions that we received yesterday, many of them 
pertain to information that is proprietary for the company. It 
is a private company. We are in a competitive environment, an 
AI company. It is a globally competitive environment. And we 
have to protect the company, even as I commit to you that when 
it comes to myself I will continue to work with this Committee 
to be transparent and forthcoming.
    Senator Paul. So let the record show that you will not 
answer the question and you will not tell us the amount that 
you put on the application that you signed your name to for 
your company on how much U.S. dollars were estimated you were 
going to lose.
    The problem with that is you just say oh, believe me. Oh 
yes, we were eligible. But that is self-policing. Give us the 
information so we can trust you. I am willing to vote for you 
but not if you stonewall us and say we are not going to give 
you the information.
    I mean, we deserve to know that because you are going to be 
in charge of these. You got $14 million in the midst of this.
    The other question that really still boggles my mind is it 
is forbidden to be involved with expansion when you get these 
loans. And yet, within three weeks of you getting your loan, we 
have your tweeting out about new hiring in Guadalajara and 
welcoming the expansion of your tech team in Guadalajara. So it 
sounds like you are in the midst of an expansion when you are 
getting the money.
    Mr. Syed. Senator Paul, these are contractors. We are not 
expanding the company elsewhere in a full-time manner. All the 
assistance we received for PPP and EIDL was used exclusively in 
the United States. It preserved jobs, 24 jobs. The company 
would not exist today, would not be in a place where it was 
able to raise financing and be able to innovate as we speak. 
So----
    Senator Paul. Eleven days after you got the money you 
tweeted out, your words, ``We welcome the newest member of our 
tech team in Guadalajara.'' Most people would read that and it 
sounds to them like you are expanding into Guadalajara, that 
you have new enterprises and new partners--or actually not even 
partners, newest member in Guadalajara.
    So the thing is you are not going to tell us what you put 
down, as far as your economic loss. You were in the middle of 
an expansion but you are saying it was a contractor and not an 
expansion.
    What was your generating revenue, how much revenue did you 
generate, did Lumiata generate in 2020?
    Mr. Syed. Senator, as I mentioned earlier, this is 
proprietary information. This is a public hearing. I am not 
going to be able to share company----
    Senator Paul. So let the record show that we have these 
questions in writing. It is not as if you were not prepared. 
You have made the decision not to divulge the information.
    And so you know, you have made it hard on me. I mean, the 
thing is I supported the Democrat pick to be the administrator. 
I would support your pick but I am not going to support it if 
you are stonewalling us on the information. You applied for a 
large amount of money from a Government entity. You did not 
tell us about it. We found out about it by searching through 
the data, and then we asked you. Then you admitted that you had 
the loan.
    But you did not volunteer that. We had to drag that out of 
you when we had evidence that you had the loan. Now you will 
not tell us about how you got the loan. And then all of a 
sudden you pop up with $14 million. For struggling restaurants 
around the country that might have gotten a PPP loan, they will 
scratch their head and say some guy with $14 million in angel 
investors got a PPP loan. He could not have survived and yet he 
got $14 million in loans. It does not pass the smell test.
    And if you are not going to give us the information, how do 
you expect me to support your nomination?
    Mr. Syed. Senator Paul, let me just reiterate this. I have 
been forthcoming with this information. I shared these loans at 
the very start of my vetting process with the SBA, with the 
Office of Government Ethics, as part of the agreement to 
determine whether there was any conflict or not.
    So I have shared this information voluntarily----
    Senator Paul. The staff informs me that you were asked for 
it and that it was not shared.
    Mr. Syed. I am sorry, could you repeat the question?
    Senator Paul. The staff informs me that you were asked for 
the information and then you revealed it but you did not share 
it voluntarily. You gave it when you were asked for it.
    So the thing is--and that is beside the point. We now know 
you had the PPP loan, you paid it back. This hearing could be 
easy and we could be saying exactly what Senator Cardin says, 
that you should be congratulated for paying it back and for 
being an upstanding citizen. But not if you say well, we are 
not going to put down how much our estimated loss. There is 
nothing proprietary about what your estimated loss was to the 
government, unless maybe there is something fishy about the 
number that you do not want to divulge.
    Nothing in that estimate, because your company is 
completely transformed now. You got $14 million. So people have 
already believed and bought into you. They are not going to 
change their decision based on your application for PPP. You 
paid it back. You have got good things you can say about 
yourself. But you are hiding some number. And when you hide it, 
that is not transparency. That is the opposite of transparency 
and it makes us doubt you.
    Mr. Syed. Senator, with all due respect, my understanding 
is that the EIDL application for COVID relief did not include, 
at the time, your projected loss. We had financially a more 
challenging year than the year 2019. Again, this is proprietary 
information that----
    Senator Paul. So you are saying the application you filled 
out, you did not put down an estimated loss?
    Mr. Syed. To my best knowledge, I do not believe that that 
information was required as part of those applications at the 
time. We have shared with you information that is part of the 
applications that were submitted for both PPP and EIDL.
    Senator Paul. We would like to provide, for the record, the 
rules for the application at the time when his application was 
made to show that the estimated loss was a requirement at the 
time, and we will be submitting that for the record.
    [The information referred to follows:]
    
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    Senator Paul. So this is a point of fact and we should 
figure this out. If you are right and I am wrong, that is fine 
and you did not have to provide it.
    But there still is the question of why you are unwilling to 
sort of divulge anything about this. And I do not think any of 
it is proprietary. I think it appears to us as if you are 
hiding something about the loan. So the more transparent you 
are, the more we believe in the things you are saying. But when 
you tell us you are not going to divulge things because of 
proprietary reasons it, frankly, makes us suspicious.
    But we will look into the facts and I will retract the 
question on the estimated loss or I will retract the accusation 
if we find out you were not required to do it.
    But this is something we can check by facts. And this will 
have to be pursued. If we find the facts of the matter are that 
that was a line and it was required, show us your application, 
you know. We are happy to show you the application in private, 
where it does not have to be read out in front of the public.
    I said to Senator Cardin on the way over here, I would 
prefer not to say the company's name, Lumiata. I would prefer 
not to say that we have doubts about your application. But that 
is why you need to give us information and not try to hide 
things from us.
    Mr. Syed. Thank you, Senator and I have shared information 
about the application through multiple requests. I absolutely 
appreciate the fact that we have to be transparent, 
forthcoming, and I have been through multiple requests.
    Again, both of these COVID loans, I declared them with the 
SBA team when the vetting process started. This was----
    Senator Paul. But your first response to me was you were 
not going to give me the estimated loss. And then your backup 
response, two minutes later, is oh, we do not think we were 
required to. You could have said that from the beginning. You 
could have said oh, we were not required to put estimated loss. 
That almost sounds like that is an evolving answer because you 
first told me I cannot give you the estimated loss. And then 
you tell me it is not on the form and was not required.
    So we are left with a lot of questions and we are going to 
have to research this further. And I am not saying absolutely I 
will not vote for you but, the thing is that our side will be 
very concerned with a trillion dollar program with someone who 
used it to a significant degree and is unwilling to give us the 
information on how you got the loan.
    Mr. Syed. Senator, thank you for the question.
    This, in a sense, saved the company's job. I appreciate 
your questions and will continue to work with the Committee. 
Thank you.
    Chairman Cardin. And I am sure Senator Paul will work 
together on this and I think there has been certain information 
that has been made available.
    I agree with you that much of this should be done in a 
closed setting when we are dealing with sensitive information.
    Senator Paul. And if he is willing to do that, I am happy 
to look at it in private. I think there are things that should 
be private. But I think there is some burden to prove----
    Chairman Cardin. We will work together to try to resolve 
this issue.
    I do want to make one observation on this. It is my 
understanding that the PPP loan was more of a self-
certification and not specific information. The EIDL loan is 
different, I grant you that.
    Senator Paul. I think that is what we think. The 
requirement for the estimated loss, we think, comes from the 
EIDL loan application.
    Chairman Cardin. So we will work on those two issues and, I 
must tell you, I stand by the statement I made during my 
questioning and that is I applaud Mr. Syed's voluntarily 
repaying the PPP loan when he was eligible for forgiveness 
because of his view that it was not the purpose of the PPP loan 
to be forgiven if you had the capital to pay off those loans.
    I think that was an exemplary conduct and I just really 
want to acknowledge that. But I understand Senator Paul's point 
and I assure you we will work together to try to get you the 
information.
    Senator Paul. And we are happy to keep an open mind.
    Chairman Cardin. I appreciate that very much.
    Senator Hirono, by video.
    Senator Hirono. Thank you, Mr. Chairman.
    And thank you for enlightening us on the fact that Mr. Syed 
paid back the loan. Yes, I agree with you that that is 
exemplary behavior.
    Mr. Syed, based on your experience as a business owner and 
entrepreneur and your time working with businesses and 
entrepreneurs in the Obama administration and more recently in 
California and elsewhere, it is clear that you have a lot of 
relevant experience to bring as the Deputy Administrator of 
SBA. So can you talk a little bit about how your experiences as 
a business owner and entrepreneur will enable you to help other 
businesses and entrepreneurs as a Deputy Administrator? And 
particularly minority businesses.
    Mr. Syed. Senator Hirono, thank you for the question.
    First of all, I think, as we discussed in previous 
questions, these recent months and year or so has been one of 
the most challenging times for small businesses and 
entrepreneurs all over the country. Both in my own running the 
company, going through some really, really difficult times. A 
year ago we were just starting to see the horrible effects of 
the pandemic, both on lives and livelihoods and businesses.
    And so it has given me, frankly, a deeper reservoir of 
empathy. What someone who has to sometime go through sleepless 
nights to think about payroll goes through. And if confirmed, I 
will bring that perspective, Senator, to my job.
    Secondly, I think to your point about communities of color 
and underserved regions, it is absolutely true that we have a 
disparity there and we need to make an intentional effort, 
intentional effort to reach out to those communities. I have 
done that in my own civic advocacy, as I have mentioned 
earlier. And I would bring that lens, as well.
    And third, I just want to add to the point that my 
operating background also prepares me to be a value-add to the 
SBA team as it stands up programs that are an unprecedented 
scale and breadth.
    Senator Hirono. One of the minority-owned businesses in 
Hawaii are the Native Hawaiian-owned businesses. And as with a 
lot of minority businesses, they have suffered 
disproportionately because of this pandemic. And so I would 
like to have a commitment from you that you will work to 
understand the needs of the Native Hawaiian businesses, the 
8(a) businesses, and to work with me to address their concerns 
going forward because they certainly could use the kind of 
empathetic leadership that you talked about.
    Senator Syed. Absolutely, Senator. And I will do so. After 
the Great Recession, as part of my role at the White House AAPI 
Commission, I spent significant time engaging with communities. 
So I will do so.
    Senator Hirono. Have you ever been to Hawaii, Mr. Syed?
    Mr. Syed. I have not. My kids and wife have been telling me 
so I will certainly do so if I am confirmed, and help these 
businesses there.
    Senator Hirono. I am not just saying that because I would 
like you to come and visit with us but Hawaii is--we have some 
very unique challenges. We are definitely not connected to the 
rest of the country, as with Alaska. And so there are some very 
unique challenges to small businesses in Hawaii. Things cost 
more to bring in. There are various issues that are unique to 
Hawaii small businesses.
    I certainly want to ask for your support in understanding 
the unique challenges that particularly Hawaii small 
businesses, and I would say the same for Alaska small 
businesses, that they face. So I would certainly like your 
commitment to do that.
    Mr. Syed. I commit to do so if I am confirmed, Senator.
    Senator Hirono. If you are confirmed, what is the first 
thing that you would want to do as the Deputy Administrator?
    Mr. Syed. That is a good question, Senator.
    You know, this will be my first job in government if I am 
confirmed. The first thing you go into any place that has 
complexity and scale, especially at this time, I want to listen 
and learn but very quickly understand where I can be a value 
add. We have an incredible team of public servants who have 
been at this agency for decades and, especially in the last 
year, put their heart and soul into standing up programs.
    I would like to understand what is working? Where is an 
area where we can do things better, whether it is the systems 
or processes or to quality infrastructure. But I would go in, 
and this is just my management style, with an open mind and try 
to learn and understand and see where we can help, where we can 
build capacity, where we can move the needle forward.
    Senator Hirono. Thank you very much, Mr. Chairman. Thank 
you, Mr. Syed.
    Chairman Cardin. Thank you, Senator Hirono.
    Senator Hawley.
    Senator Hawley. Thank you, Mr. Chairman.
    Nice to see you in person, Mr. Syed. I enjoyed our 
conversation yesterday. Thank you for your time. I look forward 
to getting into a little bit of what we discussed.
    Let me start though by asking you this: on April 15th, not 
even quite a week ago, the Republican members of the Committee, 
including me, sent a letter to the SBA Administrator, to Ms. 
Guzman, requesting that the Agency initiate an investigation 
into whether Planned Parenthood affiliates made knowingly false 
certifications on applications for PPP assistance last year 
during the height of the pandemic.
    The letter also requested that the SBA provide the 
Committee with the following information: a detailed 
explanation regarding how three separate Planned Parenthood 
affiliates were approved for a second draw PPP loans, despite 
SBA's determination they were ineligible; all forgiveness 
information associated with loans to PPPFA entities; and 
thirdly, a description of any and all actions SBA has taken to 
recover those PPP funds unlawfully provided to the Planned 
Parenthood affiliates.
    Here is my question to you: will you commit to us that if 
you are confirmed, you will work with us to make sure that we 
get the information that we requested in our letter of April 
15th?
    Mr. Syed. Senator, first of all, thank you for your 
questions. It is good to see you in person, as well.
    If confirmed--well, first of all, I think we will apply 
rules as we should for all businesses, all non-profits. I have 
read about this. I do not know, I am not aware of the 
intricacies of what is involved here. But to the extent that 
the information that you need to do your oversight, I commit to 
doing that, obviously, in partnership with the Administrator 
and our staff at the SBA.
    Senator Hawley. Good. I will hold you to that.
    And will you also commit to ensuring that the non-profit 
affiliation rule is followed as it applies to Planned 
Parenthood, and as it applies to all non-profits?
    Mr. Syed. Senator Hawley, I am not obviously up to speed on 
the non-affiliate rule. The affiliate rule is for non-profits. 
If confirmed, I will understand this and will make sure that 
the rules are applied consistently.
    One of the things that you learn in business is process is 
sanctimonious. That should be your guiding light. And I will do 
my part to make sure that, as leadership, we do that.
    Senator Hawley. Let me ask you about one of the topics we 
discussed yesterday. We talked a little bit about the Economic 
Injury Disaster Loan Program. I shared with you some of the 
struggles that businesses, small business folks, in my State 
had accessing that program. This is something I have raised in 
this forum with other folks up before us.
    And at the same time, we also discussed the fact that the 
Inspector General's report recently came back and found quite a 
lot of waste, fraud, and abuse in that program which, of 
course, is deeply frustrating because you have got people who 
are qualified who cannot access the funds. You have got people 
who should not be getting the funds and did.
    We also talked about the Shuttered Venue Operators Grant 
Program which Congress established in December but still is not 
really operable.
    Here is my point on this: SBA's track record in standing up 
these programs and administering them is not the best, to be 
frank. It needs to be better going forward. We have asked the 
SBA to do a lot during the midst of this pandemic.
    Share with us your view and your own experience from the 
private sector in how SBA can get better at implementing these 
vital programs, in making sure that there is appropriate 
oversight and controls for these programs and just, in general, 
doing its job more efficiently.
    Mr. Syed. Senator Hawley, that is a very important question 
and thank you. I appreciate the question.
    I think we all can agree that the scope of responsibility 
that SBA has, it is unprecedented. And that is one of the 
things that I am really excited about, if I am confirmed, to go 
in and be a value-add to the team.
    I think you have to look at overall what is the capacity, 
whether it is human, whether it is technology, or whether they 
are processes or people? And where do we need to make sure that 
we are--if you are upgrading, to be able to meet the moment, if 
you will.
    Obviously, I am not in the job. It would be presumptuous 
for me to opine on what we can do there. Once I am confirmed, 
if I am confirmed, I absolutely commit to you that I will work 
with the Administrator and also would like to work with you, as 
well. You are passionate about this and this is important. I 
mean, these are all of our businesses, that we do everything 
possible to make sure that we are responding in this moment 
with all our might and resources.
    Senator Hawley. If you are confirmed, when you come to look 
and review programs, like let us just say the EIDL program, the 
Economic Injury Disaster Loan Program, what sort of--as you are 
thinking about its success, about its efficiency, what sort of 
principals will you take? What sort of benchmarks will you 
apply? What will you look for? In other words, to evaluate how 
well it is done and what can be improved going forward?
    Mr. Syed. Right. It is a good question, you actually asked 
me as well yesterday. I think the first order of business would 
be, again not knowing exactly how we track things as data, how 
are these programs instrumented? What data can you look at? 
Where we are succeeding? Where we can do better? Where there is 
a gap?
    There is a whole breadth of information that we should have 
at our fingertips and we should work to do that, given just the 
scale of what you are doing.
    Obviously, I am not aware of what those things are. I am 
not in the job. Once I am there, if I am confirmed, I will make 
it a point to work with the Administrator and the staff to see 
how we can track things and make sure that we are doing better 
and, of course, sharing as appropriate with this committee.
    Senator Hawley. Very good. Thank you. Congratulations on 
your nomination.
    Mr. Syed. Thank you.
    Senator Hawley. Thank you, Mr. Chairman.
    Chairman Cardin. Thank you, Senator Hawley.
    Senator Shaheen.
    Senator Shaheen. Thank you, Mr. Chairman.
    Mr. Syed, congratulations on your nomination. I look 
forward to working with you if confirmed.
    I just want to followup a little bit on the previous 
question because since the beginning of this pandemic, it has 
been the SBA programs that have really kept so many of our 
small businesses alive during the last year with COVID. I have 
heard from so many in New Hampshire who say that it is the PPP 
loan program that has really saved them.
    I recognize, as you have said, that we are not there yet. 
But the SBA really does face two new challenges in looking at 
how to implement the new restaurant grant program, as well as 
the Shuttered Venue Grant Program.
    We appropriated, in the last package, $1.325 billion in new 
funding to help SBA administer these programs. So again, 
recognizing that you are not there yet, do you have thoughts 
about how the agency could best spend that money in a way that 
is efficient and that addresses some of the challenges that it 
has had with the previous PPP and EIDL programs?
    Mr. Syed. Senator Shaheen, thank you for the question.
    Again, unfortunately, I do not have a lot of the detail as 
to where the gaps are. The reality is this, when we have such 
an incredible resource that is being made available thanks to 
the work of this Committee and the staff, obviously I am sure 
everybody at the SBA as well would want this to be rolled out 
very soon because the sooner this gets into the small 
businesses--and having been part of the process myself, I know 
how critical that is.
    A year ago, we were going through this ourselves and it was 
very, very challenging. And I was working with communities all 
across California in the rural heartland, as we talked about, 
Senator, and saw every day matters. If you can quickly get--so 
I get that. I am deeply empathetic to that.
    Now, I also want to be careful to make any judgment to see 
what we can do since I do not have the context. What I can tell 
you is that I will bring that energy and passion and commitment 
to making sure that we do not even waste a second. And I am 
pretty sure Administrator Guzman, I worked with her in 
California, she shares that commitment, as well. That is the 
lens I will take.
    But I do think this is an opportunity for us to take the 
moment and see what are some of the things that we can do 
better in terms of our internal ops and processes and 
technology and so forth. Again, I do not have the stock of 
that. Fortunately, I have been in business where I have stood 
up infrastructure and I have scaled companies, and often in the 
face of unprecedented growth. I will bring that lens if I am 
confirmed in this job.
    Senator Shaheen. Well, I appreciate that and I look forward 
to revisiting this issue after you are confirmed.
    One of the real frustrations that I have had, and I know it 
is shared by members of this Committee during the last year, 
has been trying to get accurate information about SBA programs 
and their performance, about how much money has been lent? Who 
it has gone to? On the EIDL, again, how much money has already 
been provided to people.
    And so, recognizing that you are not there at SBA, but you 
have been a business owner. You have been a customer of SBA. 
Can you talk about how the Agency currently shares information 
with stakeholders? And what steps you would like to see taken 
to improve sharing of that information with customers of the 
SBA?
    Mr. Syed. Senator Shaheen, that is a good question and I am 
glad you asked that question.
    Again, my perspective is what I have seen, what I have 
observed. The reality is the Agency is operating at a level--I 
think we mentioned earlier--which is multiples of where it was.
    Frankly, any organization that has to go through that kind 
of a change, you have to get to the right point of 
understanding where you need to go in terms of sharing data, 
instrumenting metrics, and so forth.
    I will commit to you that that is one of the priorities we 
will make, in partnership with the Administrator but as an 
operator, if you would, in the Agency to make sure that we are 
able to track and share things that are appropriate that you 
need as the oversight committee. And that will be something 
that I commit to you that I will do as a matter of priority.
    Senator Shaheen. Thank you. We have a lot of small 
businesses in New Hampshire who are very frustrated because 
they could not get an answer from the SBA on their EIDL loans 
and what the status is. And so, I think that communication is 
critically important.
    Thank you. Thank you, Mr. Chairman.
    Chairman Cardin. Thank you, Senator Shaheen.
    Let me just followup with one point on Senator Shaheen's 
point. Yes, it is important that the stakeholders know how the 
programs are working. And if we are going to evaluate a 
program, it is not only making information available to us that 
you have. It is having that information to make it available to 
us.
    We found out the previous administration, they were not 
asking the questions that allowed us to be able to determine 
whether our intent of reaching all communities was, in fact, 
taking place. So I would just urge you to understand, you have 
got to also get granular information available so that we can 
evaluate it, and that requires an affirmative action on your 
part to make sure that information is accumulated.
    Senator Marshall.
    Senator Marshall. Thank you so much, Chairman.
    Mr. Syed, again it is good to meet you in person. I enjoyed 
our phone call. So welcome.
    You come from a technology, an AI background. How do you 
see, what are the opportunities in the SBA to use that 
background to improve the services, as well as to better 
measure what we do, leading to better management?
    Mr. Syed. It is wonderful to see you in person, Senator 
Marshall. I enjoyed the conversation, as well.
    You know, I think again, AI is early in its deployment, if 
you will, in various industries. But just from the outside and, 
again, I do not have--obviously, I am not privy to the internal 
operations.
    I think when we are generating so much data at the scale at 
which we are doing right now, with the $1 trillion that is 
working through the SBA, there are opportunities potentially in 
the area of fraud, waste, and abuse. You can look at patent 
recognition. You can see where we can actually catch things 
earlier, right? So again, I will have to dive in. I am sure 
there is some machine learning the team may already be 
deploying and I will bring that, if you will, acumen in the job 
if I am confirmed.
    So that is just probably one of the areas that one can look 
at, which I understand is a priority. It is a priority for the 
President. It is a priority for the Administrator, and also for 
this Committee.
    Senator Marshall. Great. We are certainly very proud of our 
relationship with the SBA in Kansas, our office working with 
them, and we look forward to continuing to implement new 
technology.
    Mr. Syed, are you familiar with the Hyde Amendment?
    Mr. Syed. I am at a higher level.
    Senator Marshall. So it is a law that says you cannot use 
Federal funds for abortion. Planned Parenthood is the largest 
abortion provider in America. So just using some common sense, 
does it not seem like giving money through the PPP program to 
Planned Parenthood is a violation of American law?
    Mr. Syed. Sir, I understand this is an important question, 
it is important to you. And I hear you.
    I am not in a position to comment on violation of any 
amendment because one, as I shared with you right now that I am 
not entirely familiar with the amendment. And secondly, again 
the rules pertaining to this particular entity.
    As I mentioned earlier in the question and response to 
Senator Hawley's question, if confirmed I will work with the 
Administrator to make sure that we are applying the rules 
consistently for all position, for-profit, non-profit. And that 
is what I can commit to you.
    Senator Marshall. We talked briefly about CDFI, Community 
Development Financial Institutions, and this is just something 
that I learned about at the last meeting. I think that there is 
a great opportunity for them to be more visible and better 
implemented, as well. And one piece of the puzzle that I 
discovered, as I sat down with people that could not get a PPP 
loan, and even went to different banks trying to say what can 
you do to help these people? And there are certainly reasons 
why banks were shying away from them, probably had something to 
do with their credit score.
    But it was even just their knowledge, business knowledge, 
the inability to fill out a financial statement even, just some 
real simple basic facts. I just would ask you, as you look into 
what the role of CDFIs are, if there is not an opportunity to 
help educate people so that we can bring them into the fold and 
help these--they may be great entrepreneurs but just not 
financial wizards, so to speak.
    Do you see any role for that education from the SBA?
    Mr. Syed. Absolutely. Actually, that is very close to my 
heart, Senator Marshall. Actually, pretty much a year ago, when 
the pandemic's effects were coming out, I was with a community 
in California, walking folks through various things, how to 
access PPP and so forth. And we noticed that the communities of 
color, underserved regions, rural communities, they were 
clamoring for information. They did not even know where to go, 
to your point, and especially if you are underbanked and 
unbanked.
    So I actually commit to you, this is an area that I will 
personally be very energized to help with.
    Senator Marshall. I would love that, after you are there 
three or four months, to kind of have a conversation about the 
CDFIs and how you feel they are doing and where they can 
improve.
    Thank you so much and I appreciate you coming.
    I yield back.
    Mr. Syed. Thank you.
    Senator Shaheen. Mr. Chairman.
    Chairman Cardin. Senator Shaheen?
    Senator Shaheen. Can I just make a clarification for the 
record?
    The questions that Senator Hawley and Senator Marshall are 
raising about support for Planned Parenthood under the PPP 
program. That was done under the Trump administration, under 
SBA Administrator Carranza. So I would suggest that those are 
questions that maybe should have been put to them, as opposed 
to the current Administration.
    Thank you.
    Chairman Cardin. Senator Cantwell.
    Senator Marshall. If I could just make a point, as well.
    Chairman Cardin. Senator Marshall.
    Senator Marshall. Certainly, there is a new tranche of 
money that was just recently given out by the current 
Administration, as well, just for the record.
    Chairman Cardin. Senator Cantwell.
    Senator Cantwell. Thank you, Mr. Chairman.
    Mr. Syed, thank you so much for your willingness to serve 
and thank you for the conversation we had yesterday to talk 
about many things related to the SBA administration.
    You have already heard from many of my colleagues about the 
operations of the programs that are underway or not as 
successfully underway, so just to add my comments to the 
Shuttered Venue Operations Grant, we need to make that 
successful. Obviously, we do not want the Restaurant 
Revitalization Grant to be kludgy like that. We want it to be 
successful.
    I had to step out for a minute but I think that is what the 
Chairman was asking you, to make sure that that--let us know 
anything that is necessary for us to make that restaurant 
program move successfully.
    I wanted to bring up two issues. One, there was a program 
related to the newspapers, and part of the PPP application when 
newspapers were owned by a large entity apply separately with 
the same EIN of their parent company. So some of the 
applications are being held.
    And so this is really, I think, a technical problem in the 
application form. So I hope that you would look at this and 
make sure that we are resolving these problems as it relates to 
newspapers and that the set-aside for local news networks, that 
they also fix any technical barriers.
    Mr. Syed. Senator Cantwell, thank you for those questions 
and good to see you in person. I appreciate your time for the 
call yesterday.
    So I totally agree with some of the things that you 
mentioned here. If confirmed, I will look into these things.
    You know, having gone through the process myself and seeing 
sometimes just some of the fears that are there, there is the 
opportunity to probably do better. And especially when we 
expand the program for so many different types of entities, 
right? And this has not been done----
    Senator Cantwell. But I think these are more like technical 
issues in the way that somebody asked for information that does 
not quite fit with the specificity.
    But here is another example that is very challenging. So 
the SBA lenders have denied Paycheck Protection Program loans 
to Native-owned small businesses because they do not meet the 
SBA's documentation requirement. So we have 20-plus recognized 
Tribes in the Pacific Northwest and more than 1,000 Native-
owned businesses. So these are individuals that have fishing 
rights but they have not been able to get COVID relief because 
they do not file tax returns because they do not have that 
obligation under the treaty rights. So they do not have an 
employment identification number.
    So we need to figure out how to fix this. So I hope that 
you will commit to fixing this. I mean, create a pilot program, 
figure out another way to do it. But you have 1,000 people--at 
least in my State, there would be more in Oregon and Alaska and 
California, and other places. You know, figuring out exactly 
how to make the program fit the mold for the uniqueness that 
tribal businesses represent in their tax status structure.
    It is almost like okay, come up with some other identifier, 
if that is what you are looking for, so that you know and 
understand these businesses meet the standard. They just do not 
have an EIN number.
    Mr. Syed. Thank you, Senator.
    I think it is a great example of the kind of things we need 
to put an eye toward and I commit to you that I will have that 
operating view on things in partnership with the team at the 
SBA and will work with your office, as well, to make sure that 
those potential pilot programs are being explored, given that 
the need is there and somehow they are not being addressed 
properly.
    Senator Cantwell. It is not the need. It is that they are 
being treated inequitably under the law just because of a 
previous right that they already have. So it is just the 
program did not entail thinking about people who do not have an 
EIN. So we just need to fix it.
    So thank you for your commitment to fixing it.
    Thank you, Mr. Chairman.
    Mr. Syed. Thank you, Senator.
    Chairman Cardin. Thank you, Senator Cantwell.
    Senator Inhofe, are you ready?
    Senator Inhofe. Yes.
    Thank you, Mr. Chairman. My timing is perfect. I was 
delayed on the floor, but I definitely wanted to get in here.
    I have a couple of things to talk to Mr. Syed, is that it? 
Does that sound good to you?
    Mr. Syed. That is right.
    Senator Inhofe. All right, Mr. Syed. The CARES Act included 
funding to allow the SBA to provide debt relief payments for 
regular SBA loans. Now this problem was extended through 
December 2021, the Omnibus allowing SBA to make up to eight 
additional monthly debt relief payments.
    Now businesses in my State of Oklahoma have benefited 
greatly from this program, but there are concerns that once the 
program ends businesses will be unprepared to resume regular 
loan payments. Now the SBA should consider providing banks with 
increased flexibility with payments and loans to date.
    So are you aware of these concerns? Is this something you 
have run into before?
    Mr. Syed. Senator Inhofe, I am aware of the payment relief, 
just really from outside and some friends who were able to get 
payment relief for the 7(a), 8(a), and 504 programs.
    Senator Inhofe. If you are confirmed, can you commit to 
proactively helping businesses to begin making regular loan 
payments? Because this has grown to be a problem in Oklahoma. 
Can you do that for me?
    Mr. Syed. Senator, if confirmed, I will work with the 
Administrator to explore options to see what levers can be 
applied.
    Senator Inhofe. Okay, that is good.
    Now the other thing that I was interested in is information 
keeps coming to light, because it is a pretty toxic subject, 
that Planned Parenthood has illegally received the PPP loans 
despite SBA's affiliate rules. Now their affiliate rules 
provide that, first of all, it has to be under 500, and they 
count the affiliates in with this.
    Now, with the affiliates, Planned Parenthood is some 16,000 
people. So I cannot imagine that it would not be disqualified 
just on those lines.
    What is your opinion about that?
    Mr. Syed. I am sorry, Senator, could you repeat the 
question?
    Senator Inhofe. Yes. What is your feeling about the fact 
that Planned Parenthood, we understand, has received some of 
the PPP loans, I contend are illegal because, first of all, 
just the size limit of 500. They are a group of some 16,000. So 
would you believe that they would not qualify for the PPP loans 
because of size and affiliate size alone?
    Mr. Syed. So Senator, it is an important question and we 
had an earlier discussion as well.
    I, obviously, am not familiar with the rules as applied to 
this particular entity. If confirmed, what I can commit to you 
is that I will work with the Administrator to make sure that we 
are applying rules consistently for all organizations as laid 
out in the law.
    Senator Inhofe. Yes, I am not sure it would be necessary to 
do that because you do have a hard fast rule on the number 500 
and this falls way outside of that. And so the only question I 
have is is there a loophole I do not know about, where this 
would be a legal and appropriate application of the PPP 
program?
    Mr. Syed. Senator, with all respect, I am not obviously 
familiar with the application of this particular entity, what 
was applied. Again, what I am committing to you, with absolute 
certainly, is that we will work to apply the rules consistently 
across and make sure that there is a proper eligibility review.
    Senator Inhofe. Well, do you know of any exceptions that 
are in the rules in this case that would provide to exceed the 
500 limitation for appropriate programs?
    Mr. Syed. Senator, I am obviously not privy to the rules. I 
am not in the job yet. So I am not able to comment on that. 
Again, I hear your concern, and it was brought up earlier as 
well. I commit to you that I will work with the Administrator 
and the staff to make sure that we are applying rules 
consistently for all entities.
    Senator Inhofe. All right. Well, I will be checking back at 
the appropriate time then.
    Thank you very much.
    Mr. Syed. Thank you, Senator.
    Senator Inhofe. Thank you, Mr. Chairman.
    Chairman Cardin. Thank you, Senator Inhofe.
    Senator Inhofe. Did you have any comments to make about my 
inquiry here? Because I thought that the hard fast rule was it 
had to be under 500 to apply for and be granted the PPP 
program?
    Chairman Cardin. I know this issue has come up during the 
drafting of the PPP loans and I think there has been a 
consistent interpretation of the rules as to whether the 
affiliate rules apply or not. It may not be an exception to the 
affiliate rules, it is whether the affiliate rules apply.
    This was done under the Trump administration, I would 
remind you of that. And I know that there was some displeasure 
on how the rules were adopted. There were some efforts made to 
change the legislation. Those efforts did not succeed.
    Senator Inhofe. I see. Okay well, I will have to look into 
that.
    Chairman Cardin. And I appreciate, our Committee wants to 
make sure that the rules are being applied uniformly and is 
consistent with the legislative instructions and the practice 
of the SBA. And there is some historic practice on affiliation 
rules.
    Senator Inhofe. Yes, I think there is. All right, thank 
you, Mr. Chairman.
    Chairman Cardin. Senator Rosen is with us vis-a-vis the 
web.
    Senator Rosen. Thank you, Chairman Cardin. I appreciate it. 
And thank you, Mr. Syed, for being here with us today, for your 
commitment to serving our Nation.
    I look forward to learning more about your plans to support 
our Nation's small businesses. Of course, they are continuing 
to struggle to keep their doors open, and I want to hear about 
your vision and how the Agency can better serve them as they 
begin their path to recovery.
    So I want to talk a little bit about lifting the caps on 
EIDL grants. Last month, I was pleased that Administrator 
Guzman announced that the Agency will lift the caps on EIDL 
loans from $150,000 to $500,000. And just last week, she wrote 
to me to let me know the caps would move to $2 million. So all 
of them would be removed. That was what was originally mandated 
by Congress. This is a policy change I have been calling for 
since last year. It is going to provide much needed support to 
99 percent of businesses in Nevada that are small businesses.
    However, given the prior Administration's actions to cap 
the EIDL Advance Grants to $1,000 per employee, our smallest 
businesses--including many minority-owned small businesses--did 
not receive the $10,000 grants that Congress had promised and 
passed into law.
    So in her letter last week to me, Administrator Guzman 
stated that SBA does not have the statutory authority or the 
funding to provide $10,000 grants to all eligible small 
businesses, regardless of size or location. But she indicated 
that she would not have capped the original EIDL program, as 
the last Administration had.
    That being the case, if confirmed, will you commit to 
working with my office to advance legislation that provides the 
Agency with the authority and the funding to provide all of our 
small businesses with the $10,000 EIDL Advance Grants and not 
only those that happen to be in low-income areas?
    Mr. Syed. Senator Rosen, thank you for the question and I 
totally appreciate the importance of this topic. If confirmed, 
I will work with the Administrator to work with your office and 
partner as appropriate to make sure that there is more resource 
available to small businesses.
    Senator Rosen. Thank you.
    I want to move on quickly to technology, and I know that is 
something you know a lot about. Of course, I am a former 
computer programmer, systems analyst, and early on in my career 
I learned the importance of using updated software systems, the 
latest technologies, to improve processes and provide timely 
and accurate information.
    During the COVID-19 pandemic the SBA was delegated the 
difficult task of managing a multi-billion dollar emergency 
loan and grant program, programs that have provided critical 
aid to our small business community. However, some of our 
constituents small business owners have complained they have 
waited a long time, sometimes even months. And the Agency seems 
to be requiring them to resubmit the same documents multiple 
times, delaying the process. Of course, you know, small 
businesses do not have the capital reserves to survive for many 
months.
    So given your experience in the private sector, what can 
the Agency, in your opinion, incorporate from the private 
sector to improve its internal controls and technology, thus 
speeding up the process of these loans and grants so that 
people can get the timely help they need to stay in business?
    Mr. Syed. Absolutely, Senator Rosen. This is a very 
important question and I appreciate that you understand these 
demands since your own background in technology earlier.
    As I mentioned earlier, in previous comments, there is a 
significant scale at which SBA is operating with just the 
breadth of programs and how fast they have to be stood up. 
There is obviously infrastructure, based on my reading from the 
outside, that is decades old.
    Once I go in, the first order of business for me would be 
to learn and understand what the infrastructure looks like 
before suggesting and making any changes. The reality is, we do 
have an opportunity, given the moment, to be able to see how we 
can improve capacity of this infrastructure. I, fortunately, 
bring that background. I have built and scaled infrastructure 
in technology companies at all levels.
    And I commit to you that I will work with the team to make 
sure that we are meeting the moment, while at the same time 
making sure that we do not break things that are working, given 
just the importance of delivering services as we speak.
    Senator Rosen. I think this is another area for us, as 
Congress, to consider IT modernization, creating platforms that 
are easily accessible across all State front-ends that they can 
use, and modify the back-ends in ways that they need to. And so 
we hope that we can work with you on upgrading all of your 
systems.
    Thank you.
    Thank you, Mr. Chairman.
    Mr. Syed. Thank you, Senator.
    Chairman Cardin. Thank you, Senator Rosen, appreciate that 
very much.
    I just want to followup one point with Senator Paul, and I 
know that we are going to followup in regards to the 
information that he is seeking.
    I have been informed by my staff that estimated losses was 
not required on the application when the company applied for 
the loan, and that revenue loss is now on the application 
because of the EIDL Advance Program. The EIDL application does 
ask for total revenue during the 12-months prior to the 
disaster, in this case prior to January 2020. It is my 
understanding that information was made available by Mr. Syed.
    Also, there is no question on the Committee questionnaire 
or the financial disclosure statement which would have required 
he disclose the PPP or EIDL loans. The funds were for the 
company, not for Mr. Syed personally.
    I just really wanted that to be put on the record, just so 
we had that information. But we will followup with you, Mr. 
Syed, and with Senator Paul and staff to try to resolve any 
open issues so that we can try to move your nomination as 
smoothly as possible.
    Mr. Syed. Thank you, Senator.
    Chairman Cardin. We will keep the Committee record open 
until Monday close of business for any additional questions 
that might be asked by any of the members. We would ask that 
you respond to those questions promptly that are asked.
    And with that, I see no further member and no further 
business. The Committee will stand adjourned.
    Thank you very much, Mr. Syed.
    Mr. Syed. Thank you.
    [Whereupon, at 3:56 p.m., the Committee was adjourned.]

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