Senators Urge SBA to Use Available Money to Fund EIDL Requests
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Two Senate committee chairs want the Small Business Administration to pull more funds into the Economic Impact Disaster Loan program. They are asking the SBA to pull Covid-19 relief money from relief programs where it hasn’t been spent.
Last week, the SBA urged small business owners in New York, New Jersey, Connecticut, Massachusetts and Pennsylvania to ask for EIDLs related to Hurricane Ida. The SBA announced a deadline of June 6. Within a few days, the deadline was changed to June 5, with the SBA citing lack of funding.
SBA Told to Use Money Available to Fund EIDL Loans
Here’s what Senator Ben Cardin (D-MD) and Senator Chris Van Hollen (D-MD) had to say. Cardin chairs the Small Business and Entrepreneurship committee. Hollen chairs the Appropriations Subcommittee. The statement comes from a letter the two wrote to SBA’s Administrator Isabella Casillas Guzman: “By prematurely shutting down the program, the agency appears to have prioritized its own administrative needs over those of the thousands of borrowers that await decisions on their applications. Furthermore, it has done so in a way that has needlessly confused borrowers and raised expectations.”
The senators continued, “… if funding does indeed remain available that could be transferred under the authority of the IIJA (Infrastructure Investment and Jobs Act) to serve borrowers in the EIDL loan program, SBA should exercise that authority immediately so that pending applications for modifications, rehearings and appeals can be processed and funded.”
Can Covid-19 Relief Monies Be Moved?
Yes, the Senators said. They cited a section of the Infrastructure Investment and Jobs Act (IIJA), which states that the SBA has the authority to move funds from one program to another.
To further make their point, the Senators noted that 2 months ago, the SBA transferred $500,000 from a Covid-19 relief program to replenish its own “administrative funding.”
Covid-19 Relief Funds by the Numbers
Numbers vary by source, but in general within the last 2 years there have been 6 Covid-19 relief measures totaling about $4.6 trillion. US Spending is an excellent source for in depth reporting on how those monies have been spent or obligated (committed) to date.
As of the end of January 2022, estimates reported that 87% of that money had been obligated. Of the 87% obligated, 76% had been spent (estimates range from $3.7 trillion to $4 trillion.
Where Is the Rest of the Covid-19 Money?
The Covid-19 funds have been “underspent” in education, health care and disaster relief. It’s important to know that some monies described as “underspent” are obligated, or committed, to be spent in the future. For example, the education Covid-19 relief funds pot still has $200 billion, but the deadline for spending the money is 2026. Of the $114 billion for disaster relief, $70 billion is left.
Of that, $3 billion remains in the Paycheck Protection Program (PPP). To date, about $830 billion was spent for PPP. The remainder falls under “other categories” of disaster relief money. A whopping $56 billion remains unspent in unemployment compensation.
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Image: Depositphotos
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