Watch Senator Rosen’s full remarks here.
WASHINGTON, D.C. – Today, during an oversight hearing of the Senate Committee on Small Business and Entrepreneurship on the implementation and performance of the U.S. Small Business Administration’s (SBA) COVID-19 relief programs, U.S. Senator Jacky Rosen (D-NV) questioned SBA officials and applauded the SBA’s announcement from earlier in the day that the maximum amount small businesses and non-profit organizations can borrow through its COVID-19 Economic Injury Disaster Loan (EIDL) program is increasing. This is an issue Senator Rosen has been advocating for since last year after Congress passed the CARES Act, which funded the SBA EIDL program and created the EIDL Advance program to ensure that small businesses affected by the COVID-19 pandemic received disaster loans and grants to assist them during the economic downturn.
However, during the previous Administration, the SBA arbitrarily capped EIDL loans at $150,000 instead of the $2 million limit intended by Congress, and EIDL Advance grants were capped at $1,000 per employee instead of providing full $10,000 grants, regardless of size or location.
“I want to take a brief moment to thank Administrator Guzman, Chairman Cardin, and the witnesses here today from SBA for working with me to lift the prior Administration’s EIDL loan cap that for the past year has blocked small businesses from obtaining critical funding that they needed to stay afloat,” said Senator Rosen. “As the Chairman and Mr. Rivera mentioned earlier, just before this hearing, the SBA announced that it will be raising, and then I hope eliminating, the EIDL loan cap. This change – which was Congress’ intention in the first place - will help unleash the economic potential of our small amazing businesses across this country as they navigate through the ongoing pandemic.”
“[Mr. Rivera], as you know, one year ago this week, Congress passed the CARES Act. It included provisions to ensure that small businesses – 99% of businesses in Nevada are small businesses –receive the disaster loans and grants in full. Struggling small businesses in Nevada and across the country have been waiting a year for more assistance. So I am thrilled that you are responding to Senator Cornyn and I, and again I thank you,” Senator Rosen continued.
“I’d also like to know – now that SBA has announced that it is raising the loan caps from $150,000 to $500,000 and perhaps eventually to $2 million, is SBA considering similar action to lift or raise the caps on EIDL Advance grants, regardless of size or location, which would benefit the smallest of small businesses that are the backbone of each and every single one of our communities – those family-owned businesses, those entrepreneurs that are really struggling right now?” Senator Rosen asked James Rivera, Associate Administrator, Office of Disaster Assistance of the U.S. Small Business Administration.
BACKGROUND: In March 2020, soon after the CARES Act became law, the SBA placed arbitrary caps on EIDL loans and EIDL Advance grants. Currently, EIDL loans – low-interest loans that can be used to cover small business operating expenses – have been capped at $150,000 per business, instead of the congressionally mandated maximum of $2 million. Additionally, the SBA placed caps on EIDL Advance grants to small businesses of $1,000 per employee (up to $10,000), rather than the congressionally mandated $10,000 for every eligible small business.
In April 2020, Senator Rosen co-led a letter along with Senator Cornyn (R-TX) urging the SBA to eliminate its self-imposed caps on EIDL loans and EIDL Advance grants.
In June 2020, Senator Rosen directly brought these EIDL and EIDL Advance concerns to then-SBA Administrator Carranza and then-Treasury Secretary Mnuchin during a Small Business Committee hearing.
In July 2020, Senator Rosen and Senator Cornyn introduced the EIDL for Small Businesses Act. This bipartisan legislation would assist our nation’s small businesses by removing the SBA caps on EIDL loans below $2 million – the threshold set by Congress – and require SBA to provide the full $10,000 EIDL Advance grants to all eligible small businesses, regardless of size or location, as intended by the CARES Act.
Earlier this month, Senator Rosen and Senator Cornyn reintroduced the Ensuring Increased Disaster Loans (EIDL) for Small Businesses Act.
The bipartisan Ensuring Increased Disaster Loans (EIDL) for Small Businesses Act is endorsed by the U.S. Chamber of Commerce, Small Business Roundtable (SBR), National Restaurant Association, American Hotel & Lodging Association (AHLA), National Federation of Independent Business (NFIB), International Franchise Association (IFA), Small Business Majority, Small Business for America’s Future (SBAF), Disability:IN, U.S. Black Chamber (USBC), U.S. Hispanic Chamber of Commerce (USHCC), The Asian/Pacific Islander American Chamber of Commerce & Entrepreneurship (National ACE), National Association for the Self-Employed (NASE), National Association of Women Business Owners (NAWBO), Small Business & Entrepreneurship Council (SBE Council), Las Vegas Metro Chamber of Commerce, Reno + Sparks Chamber of Commerce, Urban Chamber of Commerce, Latin Chamber of Commerce, Henderson Chamber of Commerce, and the Las Vegas Asian Chamber of Commerce.
Earlier today, Senator Rosen sent a letter to SBA Administrator Isabel Guzman urging one of her first actions as SBA Administrator to be lifting the prior Administration’s caps on Economic Injury Disaster Loans (EIDL) and EIDL Advance grants.