Katko Aims To Make Improvements To Paycheck Protection Program

SYRACUSE, NY — U.S. Rep. John Katko (NY-24) today led a bipartisan effort urging the Small Business Administration (SBA) and U.S. Treasury Department to make targeted improvements to address disparities in the Paycheck Protection Program (PPP).

Katko made the request after hearing from several local businesses who received PPP loans, but due to subsequent PPP guidance or confusion with the application process, obtained loans that were smaller than what they were entitled to receive.

Established by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, bipartisan legislation Rep. Katko supported in the House, PPP loans provide critical assistance to small businesses impacted by the COVID-19 pandemic. However, for many small businesses in Central New York, particularly seasonal businesses and those who handle their own accounting, uncertainty surrounding PPP lending has resulted in businesses receiving less assistance than they are entitled to under the program.

In some instances, businesses have received a final PPP loan amount, only to have the amount of assistance they are eligible for increased by subsequent guidance from the SBA and Treasury Department. Some of these businesses find themselves with a very limited window to request increased PPP funding after they receive their original loan, while others have no available options to seek additional assistance.

Given the significant legislative and regulatory changes that have occurred since the enactment of the PPP, business owners need a flexible timeframe to address disparities in their loan amount. For this reason, in a letter to the SBA and Treasury, Rep. Katko requested that additional, immediate flexibility be provided to PPP borrowers.

“In Central New York, the Paycheck Protection Program (PPP) has been incredibly successful— providing loans to more than 9,000 small businesses and saving nearly 200,000 local jobs,” Katko said. “However recently, I’ve heard from several local small business owners who were eligible for PPP loans, but due to confusion with the application process, ultimately received smaller loan amounts than expected. That’s why I’m leading a bipartisan effort urging the Small Business Administration and U.S. Treasury to provide borrowers with the flexibility to address disparities in their loan amount. By making this important improvement to the PPP, we will ensure Central New York businesses and workers have the help they need to endure the sustained impact of the COVID-19 pandemic.”

The full text of the request can be found below:

Dear Secretary Mnuchin and Administrator Carranza,

Thank you for your work to support America’s small business community amid the Coronavirus Disease 2019 (COVID-19) pandemic. In the interest of continuing to support these businesses and their workers, we write to express strong support for targeted improvements to the Paycheck Protection Program (PPP). Specifically, we request administrative action to allow small businesses to seek an increase in their PPP loan if they are entitled to a greater amount of assistance than they received.

Established under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, PPP loans provide critical assistance to small businesses impacted by the COVID-19 pandemic. These loans have helped millions of businesses keep their doors open and have ensured a steady income for many working families by guaranteeing loan forgiveness for employers that maintain their payroll. Given the importance of PPP loans to our nation’s economic recovery, it is critical that the program remain responsive to the needs of all of America’s businesses.

For many sole proprietors and seasonal businesses, uncertainty surrounding PPP lending has resulted in these businesses receiving less assistance than they are entitled to under the program. In some instances, businesses have received a final PPP loan amount, only to have the amount of assistance they are eligible for increased by subsequent guidance from the Small Business Administration and U.S. Treasury Department. These businesses find themselves with a very limited window to request increased PPP funding, with many having no available options to seek additional assistance.

Preventing businesses from accessing full PPP assistance will have significant consequences for America’s economic recovery. For this reason, we ask that all available flexibility be provided to allow PPP borrowers to seek an increase in their loan amount if they are entitled to a greater level of assistance than they received. This commonsense step will help businesses and workers across the country endure the sustained impact of the COVID-19 pandemic.

Thank you for your time and attention to this request. We look forward to your response.

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