All 45 Democratic senators are pushing the Trump Administration to develop a streamlined process for the smallest businesses to obtain loan forgiveness under the Paycheck Protection Program.
The 45 senators, in a letter to Treasury Secretary Steven Mnuchin and Small Business Administration Administrator Jovita Carranza, did not go as far as credit union trade groups, which have called for automatic loan forgiveness for certain borrowers.
The Democratic senators were joined by Independent Sens. Bernie Sanders of Vermont and Angus King of Maine.
The senators wrote that the forgiveness process is “tremendously cumbersome and overly complex, especially for very small businesses, sole proprietors, and underserved borrowers.”
They said they have heard concerns from lenders and small businesses about the 11-page forgiveness application. “We are especially concerned that so many of these very small and underserved businesses will feel compelled to hire accountants and attorneys to complete the forgiveness form in a manner that provides comfort that the loans will be forgiven.”
They also are concerned that many eligible businesses have not even applied for PPP loans because the process is so complicated.
They wrote that the agencies should develop a short application for low-dollar borrowers, adding that the document should require a “simple attestation on fund use and minimal documentation.”
The Democrats said that the Trump Administration also should provide lenders with “reasonable” safe harbor protections when forgiveness certifications are made for low-dollar borrowers.
Credit union trade groups have called for automatic loan forgiveness for those borrowers, although they differed on the threshold that should be used. CUNA suggested a $350,000 threshold, while NAFCU suggested a $150,000 threshold.
Meanwhile, White House economic adviser Larry Kudlow told CNN Sunday that the Trump Administration never promised that the names of PPP borrowers would be made public—echoing comments made last week by Mnuchin.
Outside groups blasted that decision. “The only plausible reason to hide information about the small-business relief program is that the Trump Administration wants to hide who is or is not getting help, and to what extent it is working,” said Rion Dennis, legislative and advocacy director at Americans for Financial Reform Education Fund.