Senators call on Trump administration to simplify PPP loan forgiveness process

Senators on Friday urged the Treasury Department and Small Business Administration (SBA) to to simplify the process for businesses to receive loan forgiveness under the Paycheck Protection Program (PPP).

Every member the Senate Democratic caucus signed a letter encouraging Treasury and the SBA to streamline the process, arguing that doing so would be particularly helpful for the smallest and most underserved businesses.

“In this public health and economic emergency, we must do all we can to make sure our small businesses have the support and assistance they need to weather the crisis,” they said in a letter to Treasury Secretary Steven Mnuchin and SBA Administrator Jovita Carranza.

Under the PPP, which was created by coronavirus relief legislation President Trump signed in late March, small businesses can get loans that are forgivable if they maintain their payrolls. Treasury and the SBA released a form last month for businesses to use to apply for loan forgiveness. 

Senate Democrats said that they’ve heard concerns from businesses and lenders that the form is complex. 

“The 11-page form that must be completed to secure forgiveness is especially burdensome, time-consuming, and costly for very small and underserved businesses, including microbusinesses, sole proprietorships, rural, and minority-owned small businesses,” the senators wrote.

The Senate Democrats said they were concerned that the complexity of the form would be an additional barrier to businesses choosing to participate in the program. They also said they were concerned that many businesses will feel that they need to hire lawyers and accountants in order to complete the loan-forgiveness form.

“The government should simplify the process such that these experts are not necessary or assist in providing this much-needed support,” the senators wrote. “That must be especially the case for our very small and underserved businesses, including in communities of color, that oftentimes lack the resources of other businesses and in many cases, have faced long-standing economic and process fairness challenges even before COVID-19. We have a chance to improve the PPP forgiveness process now for these small businesses to ensure the program works as intended.”

The senators urged Treasury and the SBA to consider creating a streamlined process for loan forgiveness for low-dollar loan amounts, issuing guidance that gives lenders reasonable protections when borrowers of small loans make certifications during the forgiveness process, creating online tools to help small business with the forgiveness process and creating a well-staffed help line for borrowers and lenders.

The Senate Democrats’ letter was led by Senate Minority Leader Charles Schumer (D-N.Y.), Senate Small Business and Entrepreneurship Committee ranking member Ben Cardin (D-Md.), Senate Banking Committee ranking member Sherrod Brown (D-Ohio) and Sen. Jeanne Shaheen (D-N.H.).

In a separate letter on Friday, a bipartisan group of more than 40 senators urged Treasury and the SBA to revise the loan forgiveness application form so that it is no more than one page long for loans under $250,000.

That letter was led by Sen. Mike Rounds (R-S.D.) and was primarily signed by Republicans, but was also signed by several moderate Democrats such as Sens. Doug Jones (D-Ala.) and Kyrsten Sinema (D-Ariz.).

“We appreciate the interest in appropriately auditing the use of government money,” the group of senators wrote. “However, the loan forgiveness application – which understandably needs more information for loans worth significantly more than $250,000 – is three times longer than the original application for the PPP.”

-updated at 5:09 p.m.

Tags Ben Cardin Charles Schumer Donald Trump doug jones Jeanne Shaheen Mike Rounds Sherrod Brown Steven Mnuchin
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