Treasury Secretary Steven Mnuchin speaks as U.S. President Donald Trump and senior White House adviser Ivanka Trump listen during an East Room event highlighting payroll protection program (PPP) loans for small businesses affected by the Coronavirus outbreak (COVID-19), at the White House in Washington, the United States, on April 28, 2020.
Carlos Barria | Reuters
The Treasury Department and the Small Business Administration have disclosed the names of many of the small businesses to which they have lent money under a program to reduce the economic damage resulting from the coronavirus pandemic.
The disclosure comes amid the Democrats̵
Treasury Secretary Steven Mnuchin sparked a Democrat protest when he initially insinuated that the Trump administration would not reveal the names of the participants. The Treasury and the SBA later reversed the course, saying they would disclose names and other details of the companies that took $ 150,000 and above PPP loans.
These loans account for nearly three quarters of the total approved loan dollars, but a much smaller percentage of the number of actual loans. About 87% of the loans were for less than $ 150,000, according to the SBA.
The SBA released other details on the program on Monday, including:
- It has approved 4.9 million loans for a total of over 521 billion dollars.
- The companies said the funding supported over 51 million jobs. But firms reported the total when applying for loans, and it’s unclear how many of those employees remained on the payroll.
- The program has approximately $ 132 billion in remaining funding.
- The average loan is $ 107,000.
- California candidates received most of the overall cash with $ 68.2 billion, followed by Texas at $ 41.1 billion and New York at $ 38.3 billion. Companies in California, Texas and New York that received loans reported having approximately 4.1 million, 2.7 million and 2 million employees respectively.
- Businesses in economically troubled areas as designated by the SBA obtained nearly 23% of the loan money, while businesses in rural areas received around 15% of the funds.
- The industries that achieved the largest share of net dollars in PPP were healthcare and social care, professional, scientific and technical services, construction and manufacturing.
The goal of the PPP is to offer forgivable loans to small businesses, helping them stay afloat and employees to keep their jobs while coronavirus puts the US economy in crisis.
Companies that maintain most of their paychecks during the loan span can convert those funds into a grant.
While the aim of the program was to help companies in difficulty with fewer than 500 employees, its effectiveness remained unclear. Initially, larger, public companies took advantage of a loosely written language to leverage the funds on their own.
Ruth’s Hospitality Group, owner of Ruth’s Chris Steak House chain, AutoNation and ShakeShack are among those who have taken out PPP loans. So did the Los Angeles Lakers.
They – and many other companies – eventually returned the money after public protests. More than $ 30 billion in loans were repaid altogether, senior administration officials refusing to be named on Monday.
Lawmakers also pushed to find out if politicians or their families took funds from the program. Representative Vicky Hartzler, R-Mo. Thursday revealed that his family’s assets received nearly $ 480,000.
The program was initially launched in April, offering $ 349 billion to small businesses. After those funds ran out quickly, the government filled the program with an additional $ 310 billion.
Critics of the program expressed concern about the amount of untapped funds that could demonstrate that rural or minority-owned businesses with weaker or absent banking relationships had difficulty accessing relief funds. More than 40% of small black business owners have been forced to close stores due to the pandemic.
Democrats have sought to secure established programs to help Main Street reach those most in need. The bill passed by Congress to replenish the program in April included $ 60 billion specifically for small lenders in response to concerns over businesses without a traditional banking relationship that accessed loans.
Last month, Congress passed a bill that eases the terms of how companies can use funds and qualify for forgiveness. It reduced the share of the loan that a company has to spend on payroll and gave them a longer period of time to use the money.
The House of Representatives followed the Senate by approving a measure Wednesday to extend the deadline for submitting program applications from June 30 to August 8.
Trump on Saturday signed a temporary extension of the PPP into law, setting a new deadline for applications on August 8 from June 30. Both houses of Congress voted to approve the extension last week.
– Kate Rogers and CNBC’s Betsy Spring contributed to this report
A pedestrian wearing a protective mask walks past a Shake Shack restaurant in Washington, DC, the United States, Monday April 20, 2020.
Adnrew Harrer | Bloomberg | Getty Images