Letter to Jovita Carranza, Small Business Administration Administrator, and Steven T. Mnuchin, Department of the Treasury Secretary - Cantwell, Hirono, Markey Urge SBA & Treasury to Help Small Businesses with 10 or Fewer Employees Access COVID-19 Relief Funds

Letter

Dear Administrator Carranza and Secretary Mnuchin:

Our smallest businesses especially women-owned and minority businesses have long struggled
getting access to capital. The coronavirus pandemic has created new hurdles for them. We urge
you to ensure that small businesses with 10 or fewer employees and self-employed individuals
get the help they need from the Paycheck Protection Program (PPP), Economic Injury Disaster
Loan (EIDL), and other COVID-19-related assistance. The needs of our smallest businesses must
be taken into account in final guidance, forms, and process for PPP loan forgiveness.

Smaller businesses represent 96 percent of small businesses across the country and are
disproportionately women- and minority-owned. Over 98 percent of women-owned businesses,
representing more than 9.7 million businesses, have fewer than 10 employees. Black-owned
businesses employ an average of nine people and 96 percent of all Black-owned firms are sole
proprietors. Approximately 96 percent of all Asian-owned businesses have less than 10
employees.

The CARES Act was meant to prioritize underserved concerns including many of these women
and minority-owned businesses. Soon after the PPP went into effect, however, it was reported
that many smaller and underserved businesses struggled to access these loans. For example, a
survey by UnidosUS and Color of Change found that only 1 in 10 Black and Latinx small
business owners received the assistance they requested and more than 40 percent received no
assistance at all. On May 8, 2020, the SBA Inspector General determined that the SBA's efforts
"did not fully align" with the CARES Act by failing to prioritize underserved markets.
At the same time, our minority communities have been disproportionately hurt by the
coronavirus pandemic. Additionally, between February and May, the unemployment rate
increased 190 percent for African-Americans and 500 percent for Asian Americans. The
unemployment rate for black women has reached as high as 16.4 percent.

Ensuring that COVID-related small business assistance reaches businesses with 10 or fewer
employees will enable more businesses to remain open and more employees to return to work,
especially in underserved communities. We appreciate your attention to this important matter
and urge you to help make COVID-19-related assistance more accessible to the smallest
businesses.

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