Three Facts on the Paycheck Protection Program You Need to Know

Today at the White House, President Trump will hold an event touting the Paycheck Protection Program (PPP).

While the program was supposed to provide relief to small businesses, the Trump administration has provided billions to the well-connected or big corporations. Here are three key facts to know:

FACT: PPP Funds Went to Big Corporations with Access to Capital and Paid their Executives At Least $1 Million

200 Publicly Traded Companies Received $800 Million. “Last week, the Treasury Department emphasized existing guidance that companies need to certify they really need the loans to survive, bringing fresh scrutiny to the over 200 publicly traded companies that have so far disclosed receiving a total of $800 million in small business funding.” [NBC News, 4/27/20]

A.US Action: 160 Publicly Traded Companies that Received PPP Funds Paid Executives At Least $1 Million. Accountable.Us Action has identified 160 publicly traded companies that paid their executives at least $1 million and received PPP taxpayer funds. [TrumpBailouts.org, accessed 4/28/20]

A.US Action: 31 Publicly Traded Companies with More than 500 Employees Received $252 Million in PPP Funds. Accountable.US Action has identified 31 publicly traded companies with more than 500 employees that have received $252 million in PPP taxpayer funds. [TrumpBailouts.org, accessed 4/28/20]

NYT: Dozen Publicly Traded Companies Received PPP Funds After Saying They Had Access to Capital. “The New York Times identified roughly a dozen publicly traded companies that had recently boasted about their access to ample capital — and then applied for and received millions of dollars in the federal loans.” [New York Times, 4/26/20]

FACT: PPP Funds Are Not Getting to Small Businesses that Need it Most

15 Percent of Companies in the Most Affected Congressional Districts Got Funding Compared to 30 Percent of Companies in the Least Affected Congressional Districts. Researchers from MIT and the University of Chicago found “that approximately 15% percent of businesses located in the most affected congressional districts were able to obtain PPP funding until April15th, 2020. By contrast, more than 30% of all businesses operating in the least affected congressional districts were able to tap into PPP funding.” [National Bureau of Economic Research, April 2020]

Loans for $1 Million Accounted for 4 Percent of First Round of PPP Applications but 45 Percent of Approved Dollars. “Loans for more than $1 million accounted for about 4% of applications but nearly 45% of approved dollars under the program, according to SBA data released Friday. That suggests larger companies received a disproportionate share of aid.” [Wall Street Journal, 4/20/20]

FACT: PPP Funds Went to Well-Connected Companies with Ties to the Trump Administration 

Wall Street Journal: PPP Funds “Came Down to How and Where [Companies] Banked.” “The small businesses that received aid under the federal government’s $350 billion rescue program weren’t always the ones with the greatest needs or the best chances to survive the coronavirus pandemic. Whether a firm made the cut often came down to how and where it banked.” [Wall Street Journal, 4/20/20]

Banks Prioritized Wealthiest Clients for PPP Funds, Giving Them “Concierge” Treatment. “That’s because some of the nation’s biggest banks, including JPMorgan Chase, Citibank and U.S. Bank, prioritized the applications of their wealthiest clients before turning to other loan seekers, according to half a dozen bank employees and financial industry executives who spoke on the condition of anonymity because they were not authorized to discuss the banks’ operations…Some banks provided highly personalized, so-called concierge service to their richest clients by enlisting representatives to walk them through every step and submit their paperwork.” [New York Times, 4/22/20]

Forbes: PPP Funds “Went to Those with the Best Relationships – Not the Neediest or Most Deserving.” “The paycheck protection program was meant to help struggling small businesses hit by COVID-19. Instead, a lot of the money went to those with the best relationships — not the neediest or most deserving.” [Forbes, 4/20/20]

Hotel Conglomerate Owned by Trump Donor Monty Bennett Received Millions in PPP Funds After Pressuring the Treasury Department and Has No Plans to Return Them. “Dallas-based billionaire Monty Bennett-controlled conglomerate, the hotel chain’s biggest recipient of small business bailout funds, announced on Saturday that it does not plan to return money to the government despite the news…Bennett, a prolific donor to President Donald Trump and the Republicans, made headlines after learning that his hotel conglomerate, which owns 130 hotels across the country, had won at least $ 58 million in emergency loans . Business Insider reported on Thursday that Bennett had hired a pair of Trump fundraisers, Jeff Miller and Roy Bailey, to pressure the Treasury Department for relief, and that he recently donated $ 50,000 to the committee. Trump fundraiser. In total, Ashford Hospitality Trust and its affiliates have requested $ 126 million from the paycheck protection program, the statement said.” [Business Insider, 4/26/20]

Company Owned by Family of Trump Campaign Fundraiser Now-Ambassador to Belgium Received $5.5. Million. “While many small businesses have found it difficult or impossible to get one of the Small Business Administration’s Paycheck Protection Program loans, a company owned by a prominent Chicago family with close ties to the Trump administration was able to get a $5.5 million loan under the program, according to documents the company filed with the Securities and Exchange Commission on Monday. U.S. Ambassador to Belgium Ronald Gidwitz, who was appointed in 2018, was then-candidate Donald Trump’s campaign finance chair for Illinois in the 2016 presidential campaign. According to filings with the SEC, Gidwitz’s family owns the majority of Continental Materials Corp., which secured the 1% interest loan.” [NPR, 4/20/20]

Hallador Energy, A Coal Company that Hired Former Trump EPA Administrator and Whose Former Government Relations Director Now Works in the Trump Energy Department, Received $10 Million in PPP Funds. “A coal company based in Indiana received $10 million from a federal loan program intended to rescue faltering small businesses from the economic ravages of the coronavirus pandemic. But Hallador Energy has several hundred more employees than the standard firm awarded money under the $2 trillion stimulus bill. And it has at least two important ties to the Trump administration: Scott Pruitt, the former Environmental Protection Agency administrator, was hired last year to lobby for the publicly traded firm in Indiana; and the company’s former government relations director now works at the Energy Department.” [Washington Post, 4/21/20]

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