With money from the Paycheck Protection Program (PPP) gone, civil rights leader Marc Morial is asking Congress to ensure additional funding toward appropriate small businesses, including black businesses.
Morial, president and CEO of the National Urban League, the largest historic civil rights and urban advocacy group, is demanding the next legislative package include specific monies for legitimately small businesses that are truly harmed.
The PPP is geared to help small businesses combat the novel coronavirus. The $350 billion lending program became law in late March as part of the $2 trillion coronavirus economic stimulus package. PPP funding ran out on April 16, just about two weeks after being launched. On Tuesday, the Senate passed a $484 billion bill to send new aid to small businesses and hospitals, the Wall Street Journal reported.
The move is part of an effort to help halt the economic meltdown caused by the coronavirus pandemic. The bill provides an additional $310 billion to PPP, Yahoo News reported. The legislation is expected to be sent to the House for approval Thursday.
Morial told BLACK ENTERPRISE the National Urban League considers what happened on Tuesday a win but more needs to be done. “Without our advocacy, the package would not include the $60 billion disaster loan fund or the funding for CDFIs (Community Development Financial Institutions) and small banks, Morial said. “We continue to advocate for desperately needed funding for local governments.”
Earlier in the week, the National Urban League blasted reports that massive restaurant chains and still-operating businesses received PPP funds that were intended for small businesses closed because of the pandemic.
“Struggling small businesses in the nation’s hardest-hit regions have not received a dime from the Paycheck Protection Program, intended for businesses with fewer than 500 employees, while hundreds of millions of dollars have gone to corporations that employ thousands, like Ruth’s Hospitality Group and Potbelly Corporation,” Morial said in a press release. “Executives whose annual compensation is in the multi-millions skirted the intent of the program by applying through subsidiaries, depriving legitimate small businesses of the aid they desperately need to survive.”
BLACK ENTERPRISE reported larger businesses got PPP funding while smaller ones didn’t.
“We are in discussions with members of Congress and senior committee staff, including Senators Chuck Schumer, Cory Booker, Chris Van Holland, Sherrod Brown, Ben Cardin, and Rep. Maxine Waters,” Morial told BLACK ENTERPRISE. Those Congressional leaders are among the most powerful in the nation’s capital. For instance, Waters is Chairwoman of the House Financial Services Committee, Schumer is Senate Minority Leader, and Cardin is Ranking Member of the Senate Small Business Committee.
Morial added the National Urban League is working on including language that specifically addresses black-owned businesses–along with other minority businesses–rural, remote and unbanked businesses as priorities. “And,” he said, “we are pushing for the COVID-19 legislation to include these provisions.”
The National Urban League reported it has been advocating in Congress for the next round of PPP funding to be reserved for legitimate small businesses that qualify under the Small Business Administration’s gross sales guidelines.
Because eligibility for PPP loans does not consider the small business size standard base on gross sales, large chains like Ruth’s and Potbelly were eligible based on the number of employees who work at individual locations, not the total workforce, the civil rights group said.
Further, much of the funding has gone to businesses that continue to operate, like construction firms, that have retained most of their workforce. Because funding was based on the size of a company’s workforce, the worst-hit businesses that had already laid-off workers were at a disadvantage.
“The lifeblood of the communities we serve are the Main Street mom-and-pop establishments, like barbers and beauty shops, neighborhood cafes, and specialty services that may employ only a few dozen or fewer workers,” Morial said. “Those are the businesses we’re fighting to protect, and we expect Congress to protect them as well.”