By Congressman TJ Cox
Rep. TJ Cox
Rep. TJ Cox

Since this crisis began, I have heard from dozens of small businesses, farms, and, in particular, minority borrowers who have been shut out of federal economic stimulus funds. As one constituent put it, “My tax dollars are as green as Ruth’s Chris’, this is just not fair.”

Unfair is right. I recently argued on the House floor about the outrageous fact that 45% of the Paycheck Protection Program’s (PPP) $349 billion dollars of funds went to just 4% of borrowers—all big businesses.

A key tool for our economic recovery, the PPP provides forgivable loans of up to $10 million for small businesses to cover payroll, rent, utility, and other costs. Unfortunately, bigger businesses quickly vacuumed up all the initial funds.

In response, last week, I led the sending of a letter to the Director of the Small Business Administration, imploring changes to the PPP program to facilitate the participation of smaller financial institutions, community banks, credit unions, and Community Development Financial Institutions (CDFIs). These community lenders make up 27% of our financial institutions. They are the primary conduit for loans to the smallest businesses and minority-owned businesses in economically distressed rural and urban communities across America.

Over the last week, Democrats in the House made it clear to the Senate that we wouldn’t agree to any replenishment of the PPP program unless the funds would be equitably distributed to all small businesses and communities across the nation.

Increasing community lender participation in the PPP was critical since many small businesses are built on loans from these institutions. For example, last year, CDFIs made nearly 800,000 loans or investments in rural and underserved communities totaling more than $21.5 billion, with an average size loan or investment of about $28,000. In contrast, the average size of all PPP loans to date is approximately $200,000 – almost seven times larger.

Community banks and credit unions are the strongest partners for small businesses in their communities. Credit unions and community banks with less than $10 billion in assets provide more than half of the total small business loans made annually by depository institutions. Collectively, these community lenders will ensure that the PPP loans reach the truly small businesses that desperately need help.

Last Thursday, we passed our fourth emergency funding package, providing urgently needed dollars and resources to sustain the fight to protect the lives and livelihoods of the American people. I’m proud to say we flipped the Senate’s legislation from an insufficient plan that did nothing to aid the survival of the most vulnerable small businesses—and one that left hospitals and health workers behind—into an agreement that follows the path set by the first bipartisan CARES Act:

Regrettably, the Administration refused to agree to more funding for state, tribal, and local governments who desperately need money to pay the workers who keep us safe. Our lives and well-being are threatened if our health care, police, fire, EMS, teachers, and other vital workers don’t have the support they deserve. The President, though, has acknowledged their need and agreed to consider this as a priority in future legislation. We will hold the Administration accountable for this promise.  

In the meantime, my colleagues and I will continue to work relentlessly and in a bipartisan way to put families and workers first and protect our nation’s health, economic security, and well-being. By working together, we’ll eradicate this virus and then begin to rebuild our economy in a way that truly reflects the greatness of our nation.


A strong COVID-19 recovery starts with strong support for small business