FOR IMMEDIATE RELEASE
Statement by Frank Knapp, Jr., co-chair of Businesses for Responsible Tax Reform and President & CEO of the South Carolina Small Business Chamber of Commerce
Washington, D.C., May 12, 2020—The HEROES Act, released today, cleans up some of the mess created by the Trump Administration’s botched rollout and administration of the Paycheck Protection Program (PPP), which–as made clear in a recent inspector general report–failed to follow the intent of the Congress and the CARES Act. However, converting the PPP loans to no-strings-attached grants would best serve small businesses trying to navigate this crisis. We urge lawmakers to consider this course of action as they negotiate the next round of assistance to small businesses.
While imperfect and containing problematic provisions that benefit large corporations, there are also changes in the bill that would fix some flaws with the PPP that have spooked small businesses from using the emergency funds. Those changes to the administration of the loan program include eliminating the requirement to use 75% of the funds on payroll expenses; extending the period to use the loans from eight weeks to 24 weeks; and rolling back IRS Notice 2020-32, which, in essence, made the loans taxable. Small businesses have had bills stacking up for weeks and they need financial flexibility to survive the COVID-19 crisis.
The bill also dedicates a portion of the remaining PPP funds for underserved businesses–those owned by women and minorities and in rural areas–that do not have do not have strong ties to traditional banks. Importantly, it would also require the Small Business Administration to regularly report on demographic, industry, size, and geographic data points for PPP loans and grants. This transparency measure comes after more than $1 billion meant for small businesses were funneled to publicly traded companies.
The need for financial help cannot be overstated. A BRTR survey of small business owners finds the economic impact of the COVID-19 pandemic has created an existential crisis for America’s small businesses: 88% have lost revenue, with 70% reporting they have lost 50% or more of their revenue.
With emergency small business assistance in place, and a commitment to helping them over the long-term, small businesses can focus on what they do best — innovating and creating jobs to lead our nation out of economic turmoil.
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Contact:
Conan Knoll
conan@emcstrategies.com
(831) 524-6764
About Businesses for Responsible Tax Reform
Businesses for Responsible Tax Reform is a coalition of business leaders calling for tax reform that truly benefits America’s small business owners. We are dedicated to ensuring tax reform is fiscally responsible, creates a level playing field for all businesses, grows the economy and works for our nation’s 30 million small business owners. Learn more about us on our website and follow us on Twitter and Facebook.