Washington – Today, Ways and Means Select Revenue Measures Subcommittee Chairman Mike Thompson (CA-05) wrote to Treasury Secretary Steven Mnuchin to express concern that much of the critical aid in the CARES Act never made it to legitimate small businesses to help keep workers on the payroll. One example is the reports that Potbelly and Ruth’s Chris Steakhouse received major funding while small restaurants were left empty-handed. Thompson asked for answers as to whether these programs are being administered as intended in order to help small businesses. A copy of Thompson’s letter is below.
April 17, 2020
The Honorable Steven Mnuchin
Department of the Treasury
500 Pennsylvania Ave., N.W.
Washington, DC 20220
Dear Secretary Mnuchin:
I write to express my concern about the alarming reports concerning the small businesses relief enacted under the Coronavirus Aid, Relief and Economic Security (CARES) Act. As you are aware, the Small Business Administration Paycheck Protection Program is designed to provide a direct incentive for small businesses to keep their workers on the payroll. However, this critical relief to keep workers employed may never get to legitimate small businesses who are desperate for help because larger companies that employ thousands of people were able to benefit from the first wave of the loans. These large companies got there first, for example large restaurants chains like Potbelly Corp. and Ruth's Hospitality Group received funding that accelerated the depletion of critical SBA loan relief and now many small family-owned businesses are unable to get the funding they need to survive and keep their workers employed.
Like many Members, I have received countless inquiries from small businesses throughout my district who have encountered major difficulties applying for relief assistance that would help their businesses survive and save the jobs of so many employees. Small businesses are not getting access to loans and many have not been able to apply before funding ran out. In addition, banks are getting ever evolving guidance which slows things down and are not embracing the Paycheck Protection Program as they should. Knowing that these funds are distributed on a first come, first served basis, small businesses in my district without existing bank relationships and resources have been left out in the cold, whereas larger companies with resources have navigated the process successfully.
Small businesses in my district are struggling to stay afloat and meet payroll obligations during this health care crisis. Many are in a financial situation where their cash may not last under current conditions. The Paycheck Protection Program is not working as intended and small businesses are still waiting, uncertain about how much they will get or when they will get it. In addition, because of the depletion of SBA loan resources, I am deeply concerned about legitimate small businesses not losing their place in line and not having to reapply. In light of the struggles facing small businesses who are working desperately to survive and keep their workers employed, the Administration must ensure the small guys get the relief Congress intended.
Thank you in advance for your prompt attention to this urgent matter.