Without objection the chair is authorized to declare recess at any time. Let me begin by saying the practice will continue to apply during remote hearings. We must continue to the rules of the committee and the house. Members are reminded the technology they are utilizing today the committee will operate in accordance with Solutions Vendor the subsequent guidance with respect to the rights of all of the members that participate. Please keep your camera on and also to participate in others like this one they prevented them from being recognized in the questions and i would move to the next available member and recognize the time provided they return to the proceedings. I will recognize that for the remainder of the time and if they witness loses connectivity during the testimony or questioning. It from the seventh Congressional District beginning in 18871996 to take on that critical role. Being a member of the Small Business committee to serve as a chair of minority enterprise. I look forward to continuing with the Small Businesses across the country we are pleased to have you join us. That the outbreak of covid19 has led to unprecedented and then to address both but today we are focusing on Paycheck Protection Program created by the cares act. The Paycheck Protection Program with the Loan Guarantee program almost 350 billion the goal of the program is to save as many jobs as possible and as quickly as possible but to do so to guarantee 50 times as many loans with the entire 2019 we appreciate all the hard work and are equally grateful for those who participated during these Uncertain Times that it was found to be less than perfect. It with these areas of improvement in the first round of paycheckk Protection Program will expose some of those areas. For example too many momandpop shops were forced to sit on the sidelines and those receiving the loans. We will help congress will add more money to the program and the Paycheck Protection Program was signed into law. It with a Paycheck Protection Program funding. In the cdc micro loan intermediaries. And those 200 serve the community. Because of the lack of the clear guidance. Agency rules act again and the ppe flexibility act between eight weeks and 24 weeks. Also permitted with the greater portion of their loans that makes todays forum a tiny one about what has worked with the program. And how congress can keep optimizing as they slowly begin to reopen. And through some prospective borrowers. For example to establish a rule that requires and then to be eligible. And with that ability of any type of Small Businesses and with the ppe product as it enters the forgiveness phase the primary concern and with that forgiveness which according to experts it is a key feature of the program because we also heard minority owned Small Businesses and micro businesses continue to struggle with ppe loans despite 130 billion remaining in the program alone. And the treasury will not be publishing the information for ppe of the data that we need for the program. I look forward to hearing from our distinguished panel today about how congress can keep improving the ppe program and if congress should continue before the second round of funding or the program closes on jun june 30th thank you to the panel for joining us here today and i now yield to the Ranking Member for opening statements. Thank you madam chair for holding this hearing today. Also i want to extend our welcome. I was elected in 1994 he left 1996 i had the pleasure of serving one term with him and as former chair his portrait is on the wall in the Committee Room we want to welcome him back to the committee im sure you make a great contribution to Small Businesses all over the country on a different note again must register my concern about the continuing conducting of Committee Meetings by virtual format the house has important work that needs completed but yet we are forced to have these hearings virtually. With states and localities opening up is a concern the house of representatives remains a virtualal entity. I certainly dont hold the chair responsible for this obviously that is above her paygrade they think the speaker should make sure congress is in session. We have a lot of work to do. Im actually in the Visitor Center right now because we are holding a hearing here in washington relating to the George Floyd Killing and Congress Response to that and obviously there is legislation has legislation the administration offered their suggestions how to move forward the executive order yesterday so we are all discussing this right here in washington unfortunately other committees are not in session and they ought toon be. Relative to todays hearing the Paycheck Protection Program then a portal opened up on april 3rd it hasnt been that long in two months the sb approved and dispersed more than four. 5 million loans totaling half a trillion dollars. It has been a herculean effort by the sba which is a relatively small Government Agency working extremely hard and its incredible how much they have done according to the may employment report according to bls nonfarm payroll rose by two. 5 million and the Unemployment Rate declined at 13. 3 percent. Its good news that it went unfortunate it is still that high we have a lot of work to do to get that Unemployment Rate down and get the economy moving again. Clearly there is a long way to go but it appears the ppe has a major impact to save Many American jobs. I see enormous impact in my district in southwestern ohio with two dozen businesses including restaurants and learning centers and manufacturers and medical practices and manyic others on may 8 i had the honor and pleasure to visit the Animal Hospital in lebanon ohio and i asked the owner if he shared his experience with us and he will be one of our witnesses here today. We know the program has not been perfect especially Early Congress madere adjustments including the paycheck enhancement act and the flexibility act and these adjustments included expanded loan forgiveness from eight weeks up at 24 weeks with the option of the Small Business and what they determine is in their best interest have the interest to pick one back option to pick one or the other and also the loan amount that must be spent on non payroll cost ive heard from a lot of folks that will help. The ppe program is a result of work of congress and the esadministration we hope to achieve a delicate balance with flexibility and to protect the integrity of the Programs Mission to conduct needed oversight transparency is a hallmark of all Government Programs we must ensure transparency without compromising confidential information and personal information. Additionally a Small Business moves closer it will be instruments toll for members of congress to examine todays discussion and we are all committed to making sure this program has maximum impact for Small Business across the country thank you to the Witnesses Today and countless businesses providing feedback to me and other members of congress especially those on theof committee how the program has worked with them and their impact we have an Immediate Impact on the program for economic recovery and thank you for holding a hearing and i yield back. I like to take a moment to explain how the hearing will proceed. Each witness will provide a statement and each member will have five minutes of questions. Please ensure your microphone is on when you begin speaking in return to mute when finished. With that thank you to the witnesses for taking time out of their busy schedule to join us. And the proprietor and has a restaurant in maine after teaching across the world she opened a restaurant in 2000 with the help of the sba loan since then she hasnc partnered to open to additional locations and has been recognized for excellence. However the outbreak of covidien teen put her restaurant in jeopardy she took out the ppe loan with the hopes that it would save her business so thank you for joining us today our next witness is eduardo senior partner and resident from an independentt Community Bank in austin texas area of 5 million in assets. As a preferred lender with two years of experience with this program as we evaluate the ppe the third witness and the advocacy andoc senior counsel and research the Advocacy Organization to provide meaningful opportunities for asset building and economic security. Thank you for joining us today. Finally i will turn it over to the rankingit member who will introduce our last witness. Madam chair the final it is today is the the Animal Hospital in lebanon ohio completing his undergraduate studies at the university of cincinnati before graduating before Ohio State University college of veterinary of medicine in o 2002. December 2006 he took over the Veterinary Clinic he changed thehe name and build his facility in 2012 and beginner be model march 2019 so just last year to allow for more growth and opportunities and his clientele obviously none of us anticipated what was coming down the pike. As a dedicated Community Servant and sponsor of many local programs and then to speak of whats going on in the School System at that time also to meet his two delightful daughters and two cats although i dont think i met all of those that day to see how they benefited from the ppe. So thank you doctor for adding a senior great animal care facilityni alike forward and i yelled back. Thank you for being here. Good afternoon welcome to all members of thehe committee. And here in my kitchen and the corona pandemic changed all of that. I like to change my thoughts and concerns in three areas the industry at large and the effectiveness of the ppe loan i help people eat healthy and food and supporting the health of the planet. I also operated a small farm in the restaurant in maine. And on seasonal calendar and then steadily over the years and while on lockdown the first word was way people. I had no idea how long i would need to take before we could get back to work. And this is a big part of the reason why. My restaurant sees 155 inside we normally serveve over 32000 meals a week with an average earning 26 an hour revenue is mostly between july and october im here today not only representingg myself but for the Restaurant Industry in general i operate in maine that is dependent on revenue from seasonal terrace. And then the government mandated operations and regardless of the industry they may create financial stressors of their own when it was first offered i thought long and hard of that eligibility. Many operating cost many operating cost. [inaudible] with this timeframe and the last thing i need is more debt the restaurant has been closed due to state mandate the ppe loan allows us to bring back staff and to take out which is less than 20 percent of normal operations. And out to issue a new ruling to have for this calculation with 513,000 but only through. That time the restaurant was still for dine in that certainly would not have been forgiven. The recent passage of the Paycheck Protection Program flexibility act and those that were struggling during the pandemic. Went to increasese my loan at 400,000. But because my local bank did not form the file the form during 15 oh two i didnt qualify for sba so now i am recommending changes. [inaudible] your time has expired. Thank you for inviting me as a former migrant farmworkers than the last 25 years as an sba lender im especially honored to be here. Ly and with the participation with 3500 resulting over 477 million supporting over 50 that 7000 employees im grateful for congresses quick action to address the unemployed americans and understand why congress and the agency felt pressure to have guidance and have lenders implement the program immediately. That now pay the price we need to look at the middleground with common sense. Let me explain the first ppe guidance the final rules that have frequently changed never fully understood how to make a ppe loan from beginning to end. No windows. To issue seven weeks into the program after those to know the terms and conditions we still dont know how those decisions will be made we made clear and complete guidance. And now loans at 10 million and with that was eliminated. We believe congress intended most Small Businesses would certify to the necessity of the loan and with other available capital. But if they begin to highlight stories now requires the borrower selfassessed need with the elsewhere test. I watch my customers fearful that was 77 million of loan loans, 31 was repaid due to contradictory guidance. But the majority of those repaid was the smallest as well on a small is 1400 imagine their fear when the government said it must returnus funds or face serious consequences. The federal government said we are here t help and then who they intend to help the very businesses that invited to participate congress can require the ink agencies one that directly contradicts the statute and then with those forgiveness issues. And then with those borrowers forgiveness and then how to appeal adverse decisions. With the guidance to place a tremendous burden on borrowers o especially those with smaller loans. We need a simplified forgiveness process. I struck me on strongly recommend to create automatic forgiveness 550,000 or less. And limited liability to rely on borrower documents and certifications but the agency confuses this mandate and with the borrower certification but they must review those documentation and to not appropriately document it can be denied and then be increasingly worried when the rules are changing should we be surprised they are skeptical about any Program Expansion without the complete guidance provided first . Pr only now are we starting to get paid and were just learning the agencies are refusing to pay fees of and eligibility based on new interpretations that is unfair and unprincipled. Here is why we chose to participate we provided alone to a husband and wife owned bakery. One of the large youre funded private relief programs in the nations history. The program is in tended. It was built around Small Business owners so they and their employees but the execution rolloutut fell short creating a barrier for Small Business owners of color and that is what i hope to for you today. Theyve been hard hit by comparison declined by 17 . They are from the same community that was the most adversely affected by the Great Recession and they are the ones most likely to have been underserved. They didnt manage just the smallest businesses. On average they have fewer employees. The latest government study shows 95 of black owned businesses and 91 of latino, a these businesses are the least likely to be served. Business owners of color are less likely to have a relationship with t the lender d this is a sharp disadvantage especially in the opening round. Businesses of color have access to the loans and credit generally reedit the study between 20 of 82016. In 2185 of all loans were made and 9 made latino. Business owners of color are more likely to. The depository institutions are helping to increase access that have been hindered by unnecessary thresholds and other requirements. Finally it tracks the documentation requirement under care that they would find it extremely difficult and while it is an improvement it is still in the documentation. Last month the general reported despite the requirement of the act, the Treasury Department failed to issue guidance to prioritize underserved markets including mobile, minority and womenowned businesses. As of today, we get to see any guidance. Also noting they didnt collect standard d data. This made it unlikely they could determine certain markets. They havent equitably served. My testimony provides more detail to address the problem in support of color going forward. As we know theres equal access to the equal opportunity. Looking to address this and they deserve a response. I urge you to seize the moment t as well as other organizations that are ready to help. Its too late for many Small Businesses and those that remain cannot wait any longer. They are set to expire in two weeks and many will never recover. Thank you and i look forward to your question. I am honored to be here and thank you for allowing me to come before you as a representative. At the time of the purchase the practice was for 34 employees and 2012 we moved from a strip mall store to a stateoftheart 5400 square foot business corridor. For the past few years theres been an amazing level of growth as well as on a revenue standpoint. For the past few years theyve been able to ask if they could add additional staff members. One of the earliest to shut down fortunately we were still able to operate but with a few restrictions in place. We were fearful at any time we would have to shut down hospitals. The first heard about this on the news and reached out to start. Asking for any information t