“It didn’t solve the problems,” Rich Fierro told CNN in an interview. “What he did was hold us for a few more months.”
The program, as developed in the early days of the pandemic and the resulting business closings across the country, was intended to do exactly that: serve as a bridge for small business owners who saw their incomes rise. they faded without problems of yours.
“It is such a fluid situation that nobody really knows when it will start to go away,” Jessica Fierro told CNN. “And then when we start to see it go off and start going up again.”
What to do with $ 130 billion
Lawmakers on both sides of the aisle are well aware that more needs to be done, and they have seed money to do it. The small business program is likely to close its doors to apps with more than $ 130 billion in allocated funds remaining untapped.
“My concern is that the money that is not being spent now is the money that we are arguing should be withheld and used for a new round of assistance to small businesses,” said Florida Republican Senator Marco Rubio. “So as long as that term is open, you can’t do that.”
Rubio, chairman of the Senate Small Business Committee, led the writing of the program and has worked to address implementation issues during its nearly three-month existence.
The reality of the current crisis has deviated the dynamics from the original intention of the program, he said.
“My feeling is that the greatest need right now is from companies that have received that assistance but now need new or different assistance,” Rubio said.
There have been some calls to extend the deadline for applications, but given the depth of the economic crisis, there is general agreement that, depending on the way the initial program is structured, it simply will not be enough. The blow has been particularly sharp for frontline service industries like hotels and restaurants, where 67% of job losses originated through May, even when those industries received more than 40% of funds disbursed, according to a report. from S&P.
The small business program served to roll out more than $ 513 billion in business loans, but as the closings progressed, the structure of how that money should be used to make loans forgivable changed. The requirement that 75% have to go toward employee wages was reduced to 60%, and the timeline in which it was to be used, eight weeks, was extended to 24 weeks.
Treasury Secretary Steven Mnuchin made it clear Tuesday that he supports the reuse of unused funds.
“I think it should be done,” Mnuchin said during a hearing of the House Financial Services Committee.
Negotiations are already underway.
New proposals are already in the works, some of which would allow the smallest and most affected companies to take advantage of a second round of financing. A proposal from Senate Democrats, including Senators Chris Coons of Delaware, Ben Cardin of Maryland and Jeanne Shaheen of New Hampshire would do exactly that.
Rubio has indicated that he would like to keep any upcoming round of funding within the existing program structure, which took weeks to refine amid an initial rocky deployment and a series of changing rules.
“We have created this channel to deliver aid and it would make perfect sense to continue using it,” Rubio said. “And for those who would already receive PPP loans, it should be fairly simple to provide additional assistance as we have all of our documentation and information.”
A specific focus has focused on better helping minority communities, which were disproportionately excluded in the early stages of the program, as well as the service and hospitality industries, which were the first affected by the pandemic and likely to be the last to return. to any appearance of normality.
In that sense, a proposal under consideration in bipartisan discussions are the longer-term loans for the most affected companies, as well as those that obtain the majority of their income in low-income communities, according to a draft obtained by CNN.
“The pandemic has lasted longer than we anticipated when we first drafted the bill,” Sen. Susan Collins, R-Maine, who is a key negotiator on the program, told CNN. “The restaurants, for example, that are not yet allowed to eat at home in the Portland area had been very grateful that PPP has taken them so far, but now they are running out of money.”
There are also broader proposals, one in particular that the Fierros have been closely monitoring.
Senators Todd Young, an Indiana Republican, and Michael Bennet, a Colorado Democrat, have tabled a comprehensive bill to expand access and flexibility to the hardest hit companies, one that would offer loans that cover up to six months of spending. . Some of that money would be forgiven based on the percentage of lost income in 2020. The rest would be paid in seven years.
While he hasn’t fully moved into budding negotiations for the next stimulus round yet, his early introduction was designed to propel him into the talks.
“We wanted to get into the conversation,” Young told CNN.
New stops loom
The Fierros also do it. In fact, they played a role in creating the bill. Rich Fierro, an Army veteran with multiple deployments in Iraq and Afghanistan who has two jobs (he is a defense contractor as well as his role in Atrevida), while attending school, attended a Bennet town hall and began arguing with him about what he needed for his business to survive.
“It’s not in the next 30 to 60 days, it’s just not the question for us anymore,” said Rich Fierro. “It’s around six months to a year, how do we maintain 50% sponsorship.”
As things stand, Senate Republicans have made it clear that they will begin work on their next stimulus proposal, of which small business financing will be a centerpiece, in July. Its final form, with competing ideas and proposals, remains an open question.
One thing that is not is the current environment as states begin to close restaurants once again and the virus is re-emerging in areas across the country.
“You know, we both own it, I’m the main brewer, my husband is there 90% of the time, my daughter also works in the front of the house,” said Jessica Fierro. “Then it’s scary.”
However, when they look to Congress for Atrevida Beer Co., the Fierros, and as many small business owners as they do, there is a clear agreement that something, anything, must be done, and soon.
“There is a lot of hard work on the part of people who are not asking for brochures, who are not asking anyone to solve their problems,” said Rich Fierro. “What we are looking for is the opportunity to continue fighting to get to where we want to be.”
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