For Immediate Release
July 8 ,2020
Below is the letter sent to Congressional leaders from Small Business for America’s Future. The letter provides recommendations for the next steps for Covid-19 relief for small business. Contact Frank Knapp at sbchamber@scsbc.org or call 803-252-5733.
July 7, 2020
The Honorable Nancy Pelosi The Honorable Mitch McConnell
Speaker Majority Leader
U.S. House of Representatives United States Senate
H-232, The Capitol S-230, The Capitol
Washington, D.C. 20515 Washington, D.C. 20510
The Honorable Kevin McCarthy The Honorable Charles E. Schumer
Minority Leader Minority Leader
U.S. House of Representatives United States Senate
H-204, The Capitol S-221, The Capitol
Washington, D.C. 20515 Washington, D.C. 20510
Dear Speaker Pelosi and Leaders McConnell, Schumer, and McCarthy:
Small Business for America’s Future (formerly Businesses for Responsible Tax Reform) is a coalition of small business owners and leaders nationwide committed to ensuring policymakers prioritize Main Street by advancing an economic framework that works for small businesses and their employees.
Recently we joined 24 other diverse business groups in signing a letter to you that presented the critical need for continued federal relief to help small businesses survive a protracted economic downturn resulting from the COVID-19 health crisis.
The collective recommendation in this letter was for a new relief program that created zero-interest loans with long-term maturity, administrative simplicity, and broad usage.
Small Business for America’s Future believes that such a zero-interest loan program will serve the needs of many of our larger, more established small businesses.
However, such a program will leave out the vast majority of our nation’s over 30 million small businesses that are not interested in taking on debt regardless of the interest rate.
In addition, the experience with the Paycheck Protection Program (PPP) clearly shows that lenders will not be interested in making smaller loans even with a 100% SBA guarantee and a processing incentive. The reason is simple and understandable. Very small businesses are perceived by lenders as too risky and not a good use of the loan processing effort, exactly the same reasons entrepreneurs and very small businesses have had problems for decades with access to capital.
Congress and the President must enact a new recovery plan for these small businesses, especially those that are minority-owned, women-owned, and sole-proprietors. Even the needs of small businesses that were able to obtain PPPs loan must be addressed.
We our calling on Congress to enact policies that create fair and equitable COVID-19 recovery plans that truly support Main Street:
- All PPP loans of $150,000 or less should be quickly forgiven. This policy is supported by the Consumer Bankers Association and the Bank Policy Institute, which found such a policy would protect “85 percent of total PPP recipients, but less than 26 percent of PPP loan dollars,” from 70 million hours of paperwork by owners, which equates to a savings of over $7 billion. Congress intended PPP loans to be forgiven. Requiring small businesses with these small loans to waste valuable time and money to achieve Congress’s original intent is simply not in the best interest of the loan recipients nor the lenders.
- IRS Notice 2020-32 should be rescinded to allow wages, rent, and other expenses paid with PPP money to be tax deductible as Congress intended.
- Create no-strings-attached recovery grants for small businesses with 20 or fewer employees that did not receive either a PPP loan or an Economic Injury Disaster Loan.
Small Business for America’s Future supported PPP loans but had earlier advocated that instead of putting private lenders in charge of deciding which small businesses should receive a loan to survive, an SBA small business grant program would have been a fairer and faster mechanism without a debt-threat to help all needy small businesses.
The last policy recommendation above re-affirms our original advocacy for grants, not loans, and takes into consideration the PPP loans already received, financial cost to the government and the 89% of all small businesses that have 20 or fewer employees and are most in need of relief.
Helping all small businesses to survive this deep recession is imperative. We will need every one of our small businesses to be healthy so that they can quickly lead the way in hiring workers to move us out of this recession as they did after the Great Recession.
We look forward to working with you on our recommendations.
Sincerely,
Small Business for America’s Future Co-Chairs
Erika Gonzalez, M.D., CEO, President, & Co-Founder of South Texas Allergy and Asthma Medical Professionals (STAAMP) and STAAMP Clinical Research and Chair, San Antonio Hispanic Chamber of Commerce
Frank Knapp Jr., Owner, Carolina Pet Resort and President & CEO, SC Small Business Chamber of Commerce
Shaundell Newsome, Visionary & Founder, Sumnu Marketing and Chairman of the Board, Urban Chamber of Commerce
Anne Zimmerman, CPA, Founder & Owner, Zimmerman & Co CPAs Inc. and Treasurer, Anderson Area Chamber of Commerce
cc: Senator Marco Rubio
Senator Ben Cardin
Representative Nydia Velazquez
Representative Steve Chabot