Two Senate Committee chairmen want the Small Business Administration to raise more money for the Economic Impact Disaster Loan program. They are asking the SBA to recover Covid-19 relief money from aid programs where it was not spent.
Last week, the SBA urged small business owners in New York, New Jersey, Connecticut, Massachusetts and Pennsylvania to request EIDLs related to Hurricane Ida. The SBA announced a June 6 deadline. Within days, the deadline was changed to June 5, with the SBA citing a lack of funding.
SBA told to use available money to fund EIDL loans
Here’s what Senator Ben Cardin (D-MD) and Senator Chris Van Hollen (D-MD) had to say. Cardin chairs the Small Business and Entrepreneurship Committee. Hollen chairs the Appropriations Subcommittee. The statement comes from a letter the two wrote to Isabella Casillas Guzman, administrator of SBA: “By closing the program early, the agency appears to have prioritized its own administrative needs over those of the thousands of borrowers awaiting decisions about their loans. to request. In addition, it has done so in a way that has unnecessarily confused borrowers and raised expectations.”
The Senators continued: “…if indeed funding remains available that can be transferred under the authority of the IIJA (Infrastructure Investment and Jobs Act) to serve borrowers in the EIDL loan program, SBA must exercise that authority immediately so that ongoing requests for changes, rehearsals and appeals can be processed and funded.”
Can Covid-19 aid funds be moved?
Yes, the senators said. They cited part of the Infrastructure Investment and Jobs Act (IIJA), which states that the SBA has the power to move funds from one program to another.
To further emphasize their point, the senators noted that the SBA transferred $500,000 from a Covid-19 aid program two months ago to supplement its own “administrative funding.”
Covid-19 relief funds in numbers
The numbers vary by source, but overall, there have been 6 Covid-19 relief measures totaling about $4.6 trillion in the past 2 years. US spending is an excellent resource for in-depth reporting on how those funds have been spent or committed (promised) to date.
At the end of January 2022, estimates reported that 87% of that money was compulsory. Of the 87% required, 76% had been spent (estimates range from $3.7 trillion to $4 trillion.
Where is the rest of the Covid-19 money?
The Covid-19 funds are “underspent” in education, health care and disaster relief. It is important to note that some funds described as ‘underspending’ are required or committed to be spent in the future. For example, the pot for education Covid-19 relief funds still has $200 billion, but the deadline to spend the money is 2026. Of the $114 billion for disaster relief, $70 billion remains.
$3 billion of that remains in the Paycheck Protection Program (PPP). To date, approximately $830 billion has been spent on PPP. The rest falls under ‘other categories’ disaster money. As much as $56 billion remains unspent on unemployment benefits.
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