July 21, 2020
By Caity Witucki
Contributing Editor, Hot Topic Tuesday
Hot Topic Tuesday — House Committee Discusses PPP Forgiveness
On Friday, July 17, 2020, the House Committee on Small Business held a hearing entitled “Oversight of the Small Business Administration and Department of Treasury Pandemic Programs.” At the hearing, SBA Administrator, Jovita Carranza, and Treasury Secretary, Steven Mnuchin, provided insight into PPP forgiveness and future small business economic recovery programs.
“One of the top issues we heard from PPP stakeholders is the incomplete and ever-changing guidance,” Small Business Committee Chairwoman Velázquez said in her opening statement. “Borrowers testify that they have very little guidance regarding how to spend the loans so they could qualify for full forgiveness. Lenders are still reporting the process for seeking forgiveness is unclear and unworkable. If forgiveness is the centerpiece of the program a streamline efficient process for getting those loans forgiven should be a priority.”
Ohio Representative, Steve Chabot specifically asked how the forgiveness process might be simplified. In response, the Treasury Secretary voiced his support for blanket forgiveness of smaller-sized PPP loans. “Should we just have forgiveness for all the small loans? I think that’s something we should consider,” said Mnuchin. “We should obviously make sure there is some fraud protection, but I look forward to working with this committee and others.”
Looking to the future, Mnuchin added that the next step in economic recovery should not focus on a particular industry, but rather, on continued revenue losses. “The Administration supports using the existing money and topping it up with some additional money… and allowing for a second payment to the businesses that are especially hard hit,” said Mnuchin. “I think that this time we need to have a revenue test and make sure that the money is going to businesses that have significant revenue declines.” This proposal in similar to several pending Congressional bills introduced last month.
Also at the hearing, the SBA Administrator indicated that the SBA intends to have the PPP Forgiveness portal open by August 2020.
Small Business Committee Hearing