Trump administration agrees to disclose details of PPP loans

Bloomberg

The Trump administration, following a backlash, said it would release details about companies that received loans of $150,000 or more from a coronavirus relief program for small businesses.
Treasury Secretary Steven Mnuchin said last week the firms that got billions of dollars in taxpayer-funded aid wouldn’t be disclosed, sparking fury from Democrats and others.
In a joint statement, the Treasury Department and the Small Business Administration (SBA) said the company names, addresses, demographic data and other information would be disclosed in five ranges — starting with $150,000 to $350,000, and going up to between $5 million and $10 million.
For loans below $150,000, only totals will be released and will be aggregated by zip code, by industry, by business type, and by various demographic categories, the agencies said. The loans above $150,000 account for almost 75% of the total loan dollars approved, they said. The statement didn’t say when the data would be released.
Lawmakers demanded the disclosure of details about Paycheck Protection Program (PPP) loans after Mnuchin said at a Senate committee hearing on June 10 that the names of companies that received forgivable loans and the amounts were proprietary or confidential. The administration had previously said the details would be disclosed, and the PPP application said such data would “automatically” be released.
Officials had expressed concerns about releasing the details because a company’s payroll is used to determine the loan amount, and some independent contractors and small businesses use their home addresses that would then be disclosed.
“We have been able to reach a bipartisan agreement on disclosure which will strike the appropriate balance of providing public transparency, while protecting the payroll and personal income information of small businesses, sole proprietors, and independent contractors,” Mnuchin said in a statement.
Critics said the public has a right to know how taxpayer dollars were being spent, and that more detail was needed to know whether PPP was serving businesses that need help. Eleven news organisations, including Bloomberg News, sued to make details of the loan
recipients public.
The SBA reported that, loans had been approved for almost 4.7 million small businesses totaling $514.5 billion. As of June 12, there were 3.9 million loans of less than $150,000 totaling $136.7 billion and almost 650,000 larger loans worth $375.6 billion.
Releasing details about companies with loans of more than $150,000 is a step in the right direction but doesn’t go far enough because it means the identities of more than 85% of loan recipients will still be withheld, said Democratic Representative James Clyburn of South Carolina, chairman of the Select Subcommittee on the Coronavirus Crisis.
Democrats on the House panel have sent letters to several banks, including JPMorgan Chase, Bank of America, Wells Fargo & Co and Citigroup Inc., asking whether they favoured larger, well-connected companies over smaller firms from rural or minority communities when making PPP loans.
The Democrats also demanded that the Trump administration release the names of all PPP borrowers.
The action “is an overdue step toward securing the transparency needed to ensure struggling small businesses, particularly minority, women and veteran-owned businesses, are getting the vital assistance they need to survive and retain their workers,” House Speaker Nancy Pelosi said in a statement on Saturday.
Republican Senator Marco Rubio of Florida, chairman of the Small Business & Entrepreneurship Committee, said the public deserves to know how effective the PPP has been, but that there are legitimate concerns about disclosing information about small firms.
“Today’s announcement strikes a balance between those concerns and the need for transparency,” Rubio said in a statement.
Lawmakers have also called on Treasury and the SBA to provide details about its coronavirus relief loans to the Government Accountability Office, which is preparing a report about how relief dollars were spent.