Manchin, bipartisan senators urge Small Business Administration to process remaining COVID loan applications

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July 19, 2022

Washington, DC – United States Senator Joe Manchin (D-WV) led 48 bipartisan senators to urge Small Business Administration (SBA) Administrator Isabella Casillas Guzman to process the remaining COVID Economic Injury Disaster (EIDL) loan applications from small businesses in West Virginia and across the country. The COVID EIDL program has provided critical relief to nearly four million small businesses since the start of the COVID-19 pandemic and continues to play a critical role in the economic recovery of West Virginia communities.

“We are writing today to ask the Small Business Administration (SBA) to resume processing COVID Economic Disaster Loan (EIDL) applications that were received by the agency’s May 6 application deadline. 2022 and to ensure that applicants with outstanding appeals are given due consideration,” senators wrote in part. “While we recognize that the agency has helped an unprecedented number of small businesses throughout the pandemic, our offices continue to hear from thousands of potential borrowers awaiting review. We also continue to hear from EIDL candidates with contested refusals who have not received any communication from the administration for months.

On April 28, 2022, the SBA announced the May 6, 2022 submission deadline for COVID EIDL loan modifications, increase requests, and denial reviews. However, many qualified small businesses that submitted their applications before the deadline remain in limbo following the SBA’s decision to stop processing some applications. The SBA has pledged to process “feasible” applications, but many deserving borrowers still haven’t had their forms processed to receive the funds they need and deserve.

“Given that many applicants did not receive a final exam, we have difficulty understanding the SBA’s decision to stop processing applications that were submitted by the May 6 submission deadline,” the Senators continued. “The EIDL program has been a vital resource for struggling small businesses throughout the pandemic, but until eligible businesses are served, the SBA still has work to do. We expect you to ensure that every deserving company that submitted applications or appeals on time receives fair consideration. »

Senator Manchin was accompanied by Senators Ben Cardin (D-MD), John Cornyn (R-TX), Chris Van Hollen (D-MD), Roger Wicker (R-MS), Michael Bennet D-CO), Bill Cassidy ( R-LA), Catherine Cortez Masto (D-NV), Marsha Blackburn (R-TN), Mark Kelly (D-AZ), Ron Wyden (D-OR), Patty Murray (D-WA), Raphael Warnock (D – GA), Maggie Hassan (D-NH), John Hickenlooper (D-CO), Alex Padilla (D-CA), Bernie Sanders (I-VT), Chuck Schumer (D-NY), Jack Reed (D-RI ), Sherrod Brown (D-OH), Richard Blumenthal (D-CT), Kirsten Gillibrand (D-NY), Bob Casey Jr. (D-PA), Jeanne Shaheen (D-NH), Jacky Rosen (D-NV ), Sheldon Whitehouse (D-RI), Krysten Sinema (D-AZ), Ed Markey (D-MA), Cory Booker (D-NJ), Tina Smith (D-MN), Mazie Hirono (D-HI), Tammy Duckworth (D-IL), Tammy Baldwin (D-WI), Debbie Stabenow (D-MI), Tim Kaine (D-VA), Ben Ray Luján (D-NM), Amy Klobuchar (D-MN), Tom Carper (D-DE), Dianne Feinstein (D-CA), Dick Durbin (D-IL), Patrick Leahy (D-VT), Brian Schatz (D-HI), Jon Ossoff (D-GA), Gary Peters ( D-MI), Jef f Merkley (D-OR), Mark Warner (D-WV), Elizabeth Warren (D-MA) and Martin Heinrich (D-NM).

The letter is available in full below and here.

Dear Administrator Guzman:

We are writing today to ask the Small Business Administration (SBA) to resume processing COVID Economic Disaster Loan (EIDL) applications that were received by the agency’s May 6, 2022 application deadline. and to ensure that applicants with outstanding appeals are given due consideration. While we recognize the agency has helped an unprecedented number of small businesses throughout the pandemic, our offices continue to hear from thousands of potential borrowers awaiting review. We also continue to hear from EIDL candidates with contested refusals who have not received any communication from the administration for months. EIDL has been a lifeline for businesses throughout this pandemic, but many continue to struggle. The program is too important to be stopped prematurely. While funds remain, we expect the SBA to process all eligible applications and appeals that were submitted by the application deadline.

Nearly four million borrowers have benefited from the EIDL program, including during the most difficult period of the pandemic when businesses could not obtain credit from other lenders. Thanks to the program, millions of business owners have been able to keep their businesses running and adapt to the changing dynamics of the pandemic.

However, our offices have heard from many companies who received conflicting or confusing instructions when applying for the program. Some business owners were asked to submit the same form multiple times and received assurances from an SBA representative that they were compliant, only to be told after waiting weeks and months that they would not still did not meet program guidelines. The SBA’s communication with borrowers fell short of our expectations and undermined public confidence in the agency.

Given that many applicants did not receive a final exam, we find it difficult to understand the SBA’s decision to stop processing applications that were submitted before the May 6 submission deadline. Rather than treat every eligible candidate as they should, the agency fell back on a vague commitment to treat “feasible” applications. Based on this substandard standard, our offices have seen far too many deserving applicants turned down by the SBA. “Workability” is not an acceptable standard to justify the rejection of an eligible and needy borrower. The barrier to denial is eligibility, not SBA’s willingness to continue processing applications. We find it particularly disturbing that your agency continues to tell our offices that loans cannot be completed due to depletion of funds when there is $800 million of loan subsidy remaining – enough to support over $7 billion. dollars of loans.

We respect that the SBA will not approve all applicants, but we expect that when a person is deemed ineligible, the SBA will provide a specific and unambiguous explanation of its decision. Anything less does a disservice to the thousands of business owners who have been tricked into believing they did everything right, only to be told their application cannot be processed because the program is closed.

The EIDL program has been a vital resource for struggling small businesses throughout the pandemic, but until eligible businesses are served, the SBA still has work to do. We expect you to ensure that every deserving company that submitted applications or appeals on time receives fair consideration.

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