Senate Democrats seek simpler loan forgiveness process for PPP
WASHINGTON — Senate Democrats are calling on the Treasury Department and Small Business Administration to simplify the process for businesses applying for loan forgiveness under the Paycheck Protection Program.
In a letter Friday to SBA Administrator Jovita Carranza and Treasury Secretary Steven Mnuchin, all 47 Senate Democrats said they have heard “significant concerns” from small businesses that the current 11-page application to have coronavirus relief loans forgiven is “especially burdensome, time-consuming, and costly.”
“Small businesses should not need to spend precious resources on an accountant or attorneys to finalize their forgiveness application,” wrote the senators, led by Sen. Sherrod Brown of Ohio, the top Democrat on the Banking Committee, and Minority Leader Chuck Schumer, D-N.Y., among others. “The government should simplify the process such that these experts are not necessary."
Businesses receiving PPP loans can qualify for full loan forgiveness if they spend at least 60% of the proceeds on payroll. Partial forgiveness is available for companies that spend less than that amount.
Specifically, the senators are calling for a streamlined forgiveness process for small loan amounts, such as an easy-to-use form that requires a simple attestation on fund use and minimal documentation.
The senators are also asking Treasury and the SBA to develop online tools, such as “how to” videos and reporting calculators, for small businesses to navigate the loan forgiveness process. And they are asking the two agencies to set up a “well-staffed” helpline for lenders and borrowers to talk through any challenges with the loan forgiveness process.
They further urged the SBA and Treasury to move to the first page of the loan forgiveness application a section for reporting demographic information about Paycheck Protection borrowers. The section is currently on the last page.
“An updated, streamlined forgiveness form should continue to collect this information, ideally including a demographic reporting section on the first page to ensure as much information as possible is gathered to provide much more clarity on whether PPP assistance has reached communities of color,” the senators wrote.