Rep. Ayanna Pressley says she and other members of the Congressional Black Caucus are pushing the Treasury Department to collect racial data on who is receiving small business loans to keep their employees on the payroll.
Under the CARES Act passed last month, $349 billion in potentially forgivable loans have been distributed through private banks to enterprises with fewer than 500 employees that have sustained financial losses because of the pandemic. The Massachusetts congresswoman acknowledged that existing fair lending laws apply to the outlay, but said racial-ethnic data are needed to assure the program is being fairly implemented.
“I’m pushing for that racial data collection when it comes to who the lenders are lending to. That which gets measured gets done,” she said on an episode of WGBH’s Basic Black that airs at 7:30 Friday night. “And so having that data and that transparency in real time will allow us to course correct. It will likely offer sobering confirmation of a lack of (parity) of loans and grants to minority small businesses.”
Pressley said she, Sen. Kamala Harris of California and Rep. Gregory Meeks of New York, all Black Caucus members, “have been aggressively lobbying Sec. (Steven) Mnuchin to give greater transparency” about the racial composition of borrowers but “that hasn’t happened to date. They’ve been unresponsive.”
Citing the persistent problems that minority businesses have obtaining loans, those members of Congress and 80 others sent a letter last week to Mnuchin and SBA administrator Jovita Carranza asking the racial-ethnic data be compiled.
The Treasury Department’s press office did not respond to an email seeking a response.
The CARES Act included $10 million for state minority businesses development agencies, Pressley said, so they could “play a role around technical assistance in assuring our businesses knew what was available to them and what they were entitled to." But she noted Massachusetts doesn’t have an MBDA.
Iván Espinoza-Madrigal, executive director of Lawyers for Civil Rights, said on the weekly public affairs show that his office is providing free legal assistance to businesses who want to apply for a loan.
Pressley criticized a rule the Small Business Administration issued after the law was passed excluding business owners who have a criminal record.
“Do you know how many restaurant owners I know, beauty salons, barbershops, that have a criminal record?” she said. “Why are they ineligible? They’re contributing to our tax base and our economy.”
Supplemental legislation that President Trump signed Friday authorizes another $310 billion in lending to small business. The first tranche of loans was quickly exhausted.
Pressley said she unsuccessfully sought a pool of dedicated funding for minority businesses, but will keep pushing for that kind of set-aside.
“Our minority businesses don’t need loans, they need grants. I’m going to be fighting for grants,” she said.
In the meantime, she urged minority businesses to act swiftly to seek loans under the latest law and “apply, apply, apply.”
