[House Hearing, 117 Congress] [From the U.S. Government Publishing Office] AN EXAMINATION OF THE SBA'S COVID-19 PROGRAMS ======================================================================= HEARING BEFORE THE COMMITTEE ON SMALL BUSINESS UNITED STATES HOUSE OF REPRESENTATIVES ONE HUNDRED SEVENTEENTH CONGRESS FIRST SESSION __________ HEARING HELD MAY 26, 2021 __________ [GRAPHIC NOT AVAILABLE IN TIFF FORMAT] Small Business Committee Document Number 117-015 Available via the GPO Website: www.govinfo.gov __________ U.S. GOVERNMENT PUBLISHING OFFICE 44-922 PDF WASHINGTON : 2022 ----------------------------------------------------------------------------------- HOUSE COMMITTEE ON SMALL BUSINESS NYDIA VELAZQUEZ, New York, Chairwoman JARED GOLDEN, Maine JASON CROW, Colorado SHARICE DAVIDS, Kansas KWEISI MFUME, Maryland DEAN PHILLIPS, Minnesota MARIE NEWMAN, Illinois CAROLYN BOURDEAUX, Georgia TROY CARTER, Louisiana JUDY CHU, California DWIGHT EVANS, Pennsylvania ANTONIO DELGADO, New York CHRISSY HOULAHAN, Pennsylvania ANDY KIM, New Jersey ANGIE CRAIG, Minnesota BLAINE LUETKEMEYER, Missouri, Ranking Member ROGER WILLIAMS, Texas JIM HAGEDORN, Minnesota PETE STAUBER, Minnesota DAN MEUSER, Pennsylvania CLAUDIA TENNEY, New York ANDREW GARBARINO, New York YOUNG KIM, California BETH VAN DUYNE, Texas BYRON DONALDS, Florida MARIA SALAZAR, Florida SCOTT FITZGERALD, Wisconsin Melissa Jung, Majority Staff Director Ellen Harrington, Majority Deputy Staff Director David Planning, Staff Director C O N T E N T S OPENING STATEMENTS Page Hon. Nydia Velazquez............................................. 1 Hon. Blaine Luetkemeyer.......................................... 3 WITNESS Hon. Isabella Casillas Guzman, Administrator, United States Small Business Administration, Washington, DC........................ 6 APPENDIX Prepared Statement: Hon. Isabella Casillas Guzman, Administrator, United States Small Business Administration, Washington, DC.............. 43 Questions and Answers for the Record: Questions from Hon. Velazquez................................ 49 Questions from Hon. Golden................................... 54 Questions from Hon. Tenney................................... 55 Questions from Hon. Van Duyne................................ 58 Questions from Hon. Salazar.................................. 61 Questions from Hon. Fitzgerald............................... 64 Questions from Hon. Luetkemeyer.............................. 66 Additional Material for the Record: CWALAC - Concerned Women for America Legislative Action Committee.................................................. 77 CUNA - Credit Union National Association..................... 79 Letter from Hon. Blaine Luetkemeyer to Hon. Isabella Casillas Guzman..................................................... 81 Letter from Hon. Blaine Luetkemeyer and Byron Donalds to Hon. Janet L. Yellen and Hon. Isabella Casillas Guzman.......... 83 Letter from Hon. Blaine Luetkemeyer and Roger Williams to Hon. Janet L. Yellen....................................... 86 NAFCU - National Association of Federally-Insured Credit Unions..................................................... 88 SBIA - Small Business Investor Alliance...................... 90 Secretary Yellen Schedule.................................... 92 AN EXAMINATION OF THE SBA'S COVID-19 PROGRAMS ---------- WEDNESDAY, MAY 26, 2021 House of Representatives, Committee on Small Business, Washington, DC. The Committee met, pursuant to call, at 10:00 a.m., via Zoom, Hon. Nydia Velazquez [chairwoman of the Committee] presiding. Present: Representatives Velazquez, Davids, Phillips, Newman, Bourdeaux, Carter, Chu, Evans, Delgado, Houlahan, Kim of New Jersey, Craig, Luetkemeyer, Williams, Hagedorn, Stauber, Meuser, Tenney, Garbarino, Kim of California, Van Duyne, Donalds, and Salazar. Chairwoman VELAZQUEZ. Good morning. I call this hearing to order. Without objection, the Chair is authorized to declare a recess at any time. I want to thank everyone, especially our witness for joining us today. Let me begin by saying that standing House and Committee rules and practice will continue to apply during remote proceedings. All Members are reminded that they are expected to adhere to these standing rules including decorum when they are participating in any remote event. With that said, the technology we are utilizing today requires us to make some small modifications to ensure that Members can fully participate in these proceedings. House regulations require Members to be visible through a video connection throughout the proceeding, so please keep your cameras on. If you participate in another proceeding, please exit and log back in later. In the event a Member encounters technical issues that prevent them from being recognized for their questioning, I will move to the next available Member of the same party and I will recognize that Member at the next appropriate time slot provided they have returned to the proceeding. Should a Member's time be interrupted by technical issues, I will recognize that Member at the next appropriate spot for the remainder of their time once their issues have been resolved. In the event a witness loses connectivity during testimony or questioning, I will reserve their time as staff address the technical issue. I may need to recess the proceedings to provide time for the witness to reconnect. Finally, remember to remain muted until you are recognized to minimize background noise. In accordance with the rules, staff have been advised to mute participants only in the event there is inadvertent background noise. Should a Member wish to be recognized, they must unmute themselves and seek recognition at the appropriate time. Before we get started, let me take a minute to welcome our newest Member, Troy Carter, from the Second District of Louisiana. Mr. Carter is a dedicated public servant having enjoyed a distinguished career at nearly every level of state and local government. He previously served in both the Louisiana House and Senate and also as New Orleans city councilman. Mr. Carter has a track record as a successful entrepreneur. We think this will serve him well and our Committee, and I look forward to working with him. Welcome, Mr. Carter. Administrator Guzman, welcome to the Small Business Committee, and thank you for being here today. First and foremost, I want to commend you for the tremendous work you have done for our nation's small businesses. It is important to point out that you took over the helm of SBA in the midst of an unprecedented crisis for our nation's small firms. In 2020, COVID-19 closed more businesses than any other year on record and left countless other entrepreneurs clinging for their survival. I appreciate the fact that you are here today in compliance with statute. Unfortunately, Treasury Secretary Yellen has declined to appear before us in complete disregard for the law, which requires her to do so. Without her at the table, this Committee cannot properly fulfill our oversight responsibilities to American taxpayers nor the nation's entrepreneurial community. While she and her team may believe their role in PPP and other small business COVID relief programs is dwindling as we move towards economic growth and economic rebirth, they are sorely mistaken. In light of the feedback we have received about the MOU between Treasury and SBA, it is incumbent upon Secretary Yellen to fulfill her statutory requirement and appear before this Committee. I look forward to working with Chair Cardin and Ranking Members Luetkemeyer and Senator Paul to find a mutually agreed upon date for Secretary Yellen to appear before our Committee with Administrator Guzman in the near future. Congress has passed eight small business relief bills, allocating more than $1 trillion to small firms during their darkest hour. The federal government's efforts to save small business were extraordinary, but distributing this aid was a monumental task for SBA. The $1 trillion-plus in federal funding represented more than 10 times SBA's annual budget. As a result, the agency administered more aid during the COVID crisis than it had for all other disasters combined during its 67-year history. To that end, it is important to recognize SBA employees for their tireless work in getting these programs up and running. The agency's efforts made an undeniable impact on entrepreneurs' lives and helped millions of small businesses and nonprofits avoid permanent closure. Yet, the massive scale of PPP and other relief programs, coupled with a quick rollout, overwhelmed the agency at times and resulted in a number of problems. My hope for today is that we will not blame but instead work constructively in a bipartisan manner to assess the current programs and partner with SBA to make improvements where needed. One of my top priorities has been increasing equity in relief programs. Early on, evidence emerged showing the smallest of firms were not getting the same access as their larger counterparts with ties to big banks. That is why I fought hard for PPP modifications last year. Additionally, under the Biden Administration, SBA has taken deliberate action to deliver relief to underserved communities. These efforts have proven to be effective in reaching those that were left behind in the initial round of PPP. With the current round of PPP, SBA has approved more than 6 million loans for a total of nearly $266 billion, with an average loan size of approximately $44,000. This is a substantial improvement compared to an average loan size of $199,951 during the first round of PPP in 2020. I also look forward to hearing more about the Targeted EIDL Program, Restaurant Revitalization Fund (RRF), and the Shuttered Venue Operating Grant Program (SVOG), three new programs that are awarding direct grants to small firms hit hard by the pandemic. Another issue that has plagued both PPP and EIDL has been fraud and abuse. Unfortunately, to get loans out the door, the previous administration lowered guardrails and fostered an environment ripe for fraud and abuse. GAO added PPP and EIDL to its annual ``High-Risk List'' in March of this year, meaning there is a need for better management and oversight. I am pleased that under your leadership, the agency has confronted these issues head-on. It is vital that SBA combats fraud and protects taxpayers' dollars. For over a year, small businesses have persevered through a once-in-a-lifetime crisis. Today, thanks to our collective efforts, small firms have hope. Across the country, customers are returning and business conditions are normalizing thanks to vaccines and public health measures. Though the pandemic may be receding, we must continue to work as a Committee to see small businesses to the end of the crisis and help facilitate a strong recovery. I now yield to the Ranking Member for his opening statement. Mr. LUETKEMEYER. Thank you, Madam Chair. And thank you for calling this important hearing. While I am glad we will be having a conversation with Small Business Administrator Guzman, I am deeply disappointed and concerned that Secretary Yellen is not with us today. As you spoke, she is required to be here by law, and I will not state the law but it is supposed to be at least 120 days after enactment of the law. She is supposed to be here at least twice a year. This is very troubling and it is in complete violation of the law. I appreciate your comments, Madam Chair, and I would like to work with you to make sure that the law is followed and that we schedule time in the future for Secretary Yellen. To that end, I have a letter here that has been signed by all the Members, the Republicans on the Committee, as well as a list of events and the schedule of Ms. Yellen over the last 2 months that I would like to enter into the record. I have a couple things---- Chairwoman VELAZQUEZ. Without objection. Without objection. Mr. LUETKEMEYER. Thank you, Madam Chair. And the list of activities I have no problem with. I think that she is doing her job. Probably doing it well. But there are a couple of events on here that are actually political activities. And again, I do not have a problem with her doing it except that it shows that she is prioritizing political activities over her job which is by law supposed to be in front of us. That cannot happen. The Paycheck Protection Program (PPP) was established in a bipartisan manner to be administered by the SBA and the Department of Treasury. With reservation, Secretary Mnuchin testified before this Committee last Congress. His testimony was critical as it helped Members on both sides of the aisle export questions from their constituents and assisted Members with next steps for the COVID relief programs. It is a clear sign that this administration's Treasury Department, one of the biggest in the federal government, is ignoring America's small businesses. Simply put, if the Treasury Secretary and Biden Administration truly cared about the nation's small businesses and their employees, Secretary Yellen would be testifying today. Despite the Treasury secretary not being with us, we have much to discuss. COVID-19 was devastating to our nation's small businesses, entrepreneurs, and startups. Without precedence, state and local shutdown orders forced small businesses to operate either under restricted capacity numbers or close their doors to the public all together. Responding to the backbreaking impact on small businesses, Congress and the Trump Administration quickly focused on assisting small business workers. According to SBA's Office of Advocacy, small business employees represented approximately half the nation's workforce. Importantly, one program that was front and center for struggling small businesses was the Paycheck Protection Program, which private sector lenders delivered to small businesses many, many, many loans and all the dollars in those loans. PPP offered potentially forgivable loans in the dollars that were used and on payroll and a few other eligible expenses and millions and millions of small businesses took advantage of the program. And it is now concluding. The next phase of the program will focus strictly on the PPP forgiveness. Beyond PPP, Congress also activated the EIDL program. But unfortunately, this program, which is administered as a direct loan program through SBA, has been riddled with fraud. The SBA Inspector General Report highlighting $78 billion in fraudulent activity to a report released 3 weeks ago where the inspector general found over 800,000 EIDL applications that were flagged for identity theft concerns, it is clear the program is not safeguarding American taxpayer dollars. Any amount of fraud is absolutely unacceptable. However, this level of fraud shows the SBA is not suited to administer any direct lending program. On top of the fraud issues, the EIDL program is slow to reach small businesses in time of need. Historically, the SBA turn time to small businesses has always been at a snail's pace. In stark contrast, the PPP, unlike the EIDL program, was set up to capitalize on the efficiencies of private sector lenders, not the SBA. In addition to the turn time, the PPP also protected taxpayer dollars more effectively compared to EIDL due to lenders having responsibility to know their customers and know how to underwrite loans. As we continue to explore the SBA programs, we must look to the private sector to find efficiencies and innovations. The SBA's ability to make direct loans to small businesses must be studied. In addition to making loans, the SBA has also inefficiently operated the Shuttered Venue Operator Grant Program for struggling venues, theaters, and other cultural entities. The night before the program launched, the SBA's inspector general warned of a series of concerns or serious concerns about the oversight controls in place. Then, a few hours after the opening of the portal, the SBA had to take it offline to troubleshoot. The program eventually relaunched but has yet to disburse any funds to struggling venues, although this morning, conveniently this morning, they announced that they are going to disburse some money very shortly. Amazing how that works. While the SBA has been ignoring the venues program, it has been championed by the Biden Administration's Restaurant Revitalization Fund Program. The SBA celebrated the priority period which unfairly picks winners and losers. This administration even highlighted that the program is reaching potentially undocumented individuals and those with an unknown immigration status over hardworking citizens of the United States. And they are even being sued for this discriminatory practice today. Overall, it seems each day brings another complication from the SBA. I know Republican Members have many of the same concerns that I do. However, the SBA's track record for answering our questions has been underwhelming, and at times, nonexistent. Thus far, my colleagues and I have sent numerous letters to Administrator Guzman and received limited responses. I would like to insert every letter that has failed to receive a response in today's record. The hearing record, Madam Chair. I would like to insert some records, some letters. Chairwoman VELAZQUEZ. Without objection. Mr. LUETKEMEYER. Thank you, Madam Chair. I am hopeful this conversation produced results because at the end of the day, small businesses drive our nation's economy. We must provide an environment for small businesses to operate independently and as quickly as possible. Unfortunately, this administration is threatening the small business recovery with increased taxes and more regulatory burdens. We cannot allow these changes to occur. The health of our nation will depend on the health of small businesses. And with that, Madam Chair, I yield back. Thank you. Chairwoman VELAZQUEZ. Thank you, Mr. Luetkemeyer. The gentleman yields back. I would like to take a moment to explain how this hearing will proceed. You will have 5 minutes to provide a statement and each Committee Member will have 5 minutes for questions. Please ensure that your microphone is on when you begin speaking and that you return to mute when finished. I would like to introduce The Honorable Isabella Casillas Guzman, who was sworn in as the 27th administrator of the SBA. She previously served as Director of the California Office of the Small Business Advocate in the Governor's Office of Business and Economic Development. From 2014 to 2017, Administrator Guzman served in leadership of the SBA as the agency's Deputy Chief of Staff and Senior Advisor where she oversaw policy and new program implementation. She earned a Bachelor of Science from the University of Pennsylvania Wharton School of Business. Welcome, Administrator Guzman. Ms. Guzman, you are now recognized for 5 minutes. STATEMENT OF THE HONORABLE ISABELLA CASILLAS GUZMAN, ADMINISTRATOR, UNITED STATES SMALL BUSINESS ADMINISTRATION Ms. GUZMAN. Good morning, Chairwoman Velazquez. Thank you so much. And Ranking Member Luetkemeyer, as well as Members of the Committee. I really appreciate the invitation and the opportunity to be here to discuss SBA's programs in response to the COVID pandemic. When I appeared before you as a nominee, excuse me, when I have been meeting with you all over the past couple of months since I have been in office, I have mentioned how this unprecedented crisis for our nation's 30 million small businesses and innovative startups has created a sense of urgency at the SBA to work harder, think more creatively and build more collaboration to meet the desperate need presented by this moment. And in my first 100 days as SBA administrator, I can tell you that my motivation to deliver for our entrepreneurs has only intensified. And I have to share how proud I am of my incredible mission-driven team at the SBA who despite having had to scale at a high intensity the past year- plus remained incredibly committed to our nation's entrepreneurs. They have been working around the clock to deliver all the components of the American Rescue Plan's crucial relief program to ensure our small businesses can survive this disaster and get on the path to recovery, growth, and resilience. We are making significant progress, particularly in our efforts to reach small businesses owned by women and people of color, who, because of longstanding barriers to capital, markets and networks have suffered disproportionately from this pandemic and by many accounts were not able to access relief. We are seeing the impact. The latest economic reports show that small business jobs have begun to rebound, and proprietors' income levels have begun to recover. And, we are hearing from the small businesses we serve that both our traditional and our new relief programs have created vital lifelines. Earlier this month, we successfully launched the $28.6 billion Restaurant Revitalization Fund. As of Monday, when the application portal closed, we have received more than 372,000 applications representing over $76 billion in requested funds, and more than half of those applications came from food and beverage businesses owned by women, veterans, and people of color, who as directed by Congress, received priority access to the program. And we are reaching the smallest of the small food and beverage businesses, with one-third of the total funds set aside just for them, including a specific set-aside I created for businesses with revenues of $50,000 and under. I am proud of how we have rolled out this program in under 2 months while focusing on my key priorities of meeting small businesses where they are and integrating a customer-first, technology-driven, and equitable approach. We also launched the $16.2 billion Shuttered Venue Operators Grant Program. As of May 25, the SVOG program has received more than 13,000 applications for approximately $11 billion in requested funds. We started awarding our SVOG funds this week and we hope to continue to help our nation's venues hold on until they can bring back the performances and experiences that are the lifeblood of the American culture. Through our Paycheck Protection Program and Economic Injury Disaster Loan Program, we have now gone beyond $1 trillion in relief, and so far in 2021, 95 percent of PPP loans have gone to small businesses with fewer than 20 employees. Our priority across all of our relief programs is to get funds into the hands of small businesses swiftly, efficiently and equitably. At the same time, we are also committed to maintaining a high level of oversight to minimize fraud and abuse while elevating transparency and open communication. We have implemented controls and oversight to better achieve that balance and reverse some of the previous fraud challenges that initially plagued the PPP and EIDL programs. I was pleased to hear both GAO's Bill Shear and SBA's Inspector General Mike Ware say in a recent House Committee hearing that transparency at the SBA has improved under my watch and that our relationship is off to a very good start. There is a lot of work to do but we are working diligently to ensure this relief gets into the hands of the businesses for whom it was intended. Beyond our COVID relief program, we are also looking to the future and our nation's economic recovery with an eye toward equity. Small businesses are starting to reopen but they are still reeling with major revenue losses, and most expect recovery to take more than 6 months. This means that we will continue to see the need for capital, which is why the SBA is exploring all options to open up capital access, including direct lending. Additionally, we know that the best thing we can do for our small businesses is to help our nation recover from COVID and get our marketplaces and main streets back to normal. With more than 61 percent of adult Americans who have taken at least one shot of the COVID vaccine, we are making progress. The SBA is doing its party by getting the word out about the American Rescue Plan tax credit available to small businesses that provide paid leave to employees receiving or recovering from a COVID vaccination. There is so much more work to do. As the voice for America's small businesses and innovative startups, I will be leveraging every tool at my disposal to bring businesses back, create jobs, and build an equitable economy that works for everyone. I look forward to partnering with you all to give entrepreneurs the tools they need to start, sustain, and grow into the future. Thank you so much, Chairwoman Velazquez, Ranking Member Luetkemeyer, and Members of the Committee, for the opportunity to appear before you today. Chairwoman VELAZQUEZ. Thank you, Ms. Guzman. I will begin by recognizing myself for 5 minutes. Ms. Guzman, Administrator, we will hear a lot today about fraud, which has been a concern since the relief programs opened. Since you took over as administrator on March 17, how has the agency worked to prevent fraud, waste, and abuse in its pandemic response programs, both old and new, like restaurants and shuttered venues? Ms. GUZMAN. The administration has made it a priority to implement all of our relief programs with integrity and transparency, and SBA has been implementing a holistic approach to fraud mitigation to ensure consistency across all of those programs. It is a high priority of mine as well. As I said, I want to get these funds into the hands of those businesses it was intended to serve. So my staff is aware that I take this seriously in cooperation with the GA and IG has been of high importance for us to make sure that we are implementing best practices and doing the most that we can to prevent fraud, waste, and abuse. I have directed my team to look at best in class practices, adopting technology where it works to ensure that we are aligned with bets practices that the IG and GAO have recommended, and we have been implementing controls and evaluating it. Chairwoman VELAZQUEZ. Thank you. So you are open to providing any information required by the IG, GAO, providing data that they must access in order to make an assessment as to if the programs are working as they were intended by law? Ms. GUZMAN. That is correct. Chairwoman VELAZQUEZ. The Restaurant Revitalization Fund has a 21-day priority period for grants to women- and veteran- owned businesses and socially or economically disadvantaged firms. Who would this program help to ensure the equitable distribution of pandemic relief? Ms. GUZMAN. We have worked really hard to do extensive outreach across the board for restaurants, reaching our smallest businesses, as well as those priority groups across the board. We have reached over 100,000 people in multiple events. And so that is reflected in the large number of applicants that we have seen come through the system. We believe that that outreach, that connection to resources is most critical to make sure that businesses of all types can access this program. In addition though, we tried to streamline, put ourselves in the customers' shoes, and adopt technology to make sure that this process was as simple as possible for them to access. And we have seen those results come into play because on average, about 20 minutes to fill out the application. There are technology prompts throughout to help businesses, and they have gotten assistance with greater customer service in over 17 languages. Chairwoman VELAZQUEZ. Thank you. Ms. GUZMAN. And we have done a lot. Chairwoman VELAZQUEZ. Yes. I have another question and too many to ask. In the first round of the PPP, large companies took advantage of the emergency relief, squeezing out the neighborhood restaurants and ``mom and pop'' shops. Could you discuss how the set-asides for community lenders and small businesses in LMI areas can ensure that the capital was made available to the smallest of the small businesses and truly underserved businesses? Ms. GUZMAN. Based on the performance that we have seen with these community financial institutions, our CDFIs and CDCs, and minority depository institutions, we know that they oftentimes reach those businesses that have been underserved. And so those priorities have enabled businesses to access the program. And as I shared that we have seen in 2021 that the PPP has been accessed more by LMI communities, as well as rural and those underserved marketplaces. Chairwoman VELAZQUEZ. Thank you. The pandemic has exposed the systemic inequalities facing women- and minority-owned small businesses, which have been particularly hard hit this past year. What steps are you taking to address these inequalities and to make sure all small businesses have access to SBA resources? Ms. GUZMAN. I have instructed my teams to really position themselves in the customers' mindset. I mean, understanding what their financials look like, what their situation is. Businesses have been transformed especially during COVID. Their situations are quite different. So we are evaluating all our programs to make sure that they can serve all constituencies equitably and everything is on the table. In addition, we are focusing on the outreach and the Community Navigators Pilot Program will be just another tool that we can make sure that our businesses are connected to the resources that they need. Chairwoman VELAZQUEZ. Thank you. I really want to commend you for raising the limit on the EIDL program to $500,000 as one of your first actions as administrator. My time has expired and now I recognize the Ranking Member, Mr. Luetkemeyer, for 5 minutes. Mr. LUETKEMEYER. Thank you, Madam Chair. And welcome, Administrator Guzman. As we all know and we discussed here, COVID hit our country and caused all sorts of unprecedented things within our economy to happen, shut down the economy, and as a result, lots and lots of small businesses were in dire straits. Some of them going out of business, some of them temporarily postponing their ability to have their businesses open. And we put in place the PPP program and the EIDL program but they had dramatically different outcomes. The PPP program, which was run by and administered by the financial institutions did a really, really good job. When you look at over $800 billion going out the door and the minimal amount of fraud and theft, identity theft that went on, it is in a ten-thousandths of a percent, which by any measurement that is very successful. The EIDL program to contrast that was over $200 billion and roughly a third according to the SBA's Inspector General as in my opening remarks, has either been pointed out as potential fraud if not documented fraud, identity theft in particular, with that program. Over 800,000 applications have been flagged for identity theft. There is a difference in the way these two programs are administered. One is through the private sector which has law and rules with regards to knowing your customers. They have processes and procedures in place. They know how to administer loans, make loans. And then the SBA was totally in charge of the EIDL program. Do you believe or do you acknowledge that the private sector lenders from the community banks, the CDFIs and MDIs, efficiently delivered funding to small businesses during COVID, Administrator Guzman? Ms. GUZMAN. Our partners have done a great job as they have across our historic programs in implementing the PPP. Yes, I would agree with that. And then in terms of the EIDL, specifically, note that there were some challenges in the way the program was designed, which is why I have informed my staff that we need to look at fraud controls from inception of design and implementation. For example, by statute, we are not allowed to collect tax returns, which is one of the biggest controls that we can use as a tool. So without some of those controls in place in the beginning, of course, that has now shifted and we have adopted controls in place to prevent fraud in order to really meet the needs of these small businesses to make sure it gets into the hands of the right folks. Mr. LUETKEMEYER. Do you think incorporating some private sector lenders in the middle of that would be helpful? Ms. GUZMAN. I know that across the board our private sector lenders are great partners across the board. But in terms of the interest in providing disaster assistance, historically, they have not been interested. It has been too costly for them to adopt this type of relief and that is why the government has stepped in to provide assistance. Mr. LUETKEMEYER. Well, maybe we can work together, administrator, to iron out that little problem there in that a third of the money could be susceptible to fraud is totally, totally unacceptable. Something has got to change structurally within what is going on in the EIDL program. And it looks to me if you just compare PPP to the EIDL program, the template is there for how to fix this. But I want to work with you on that. We have got a huge problem. Together we can come up with some solutions. Thank you. Ms. GUZMAN. I look forward to that. Mr. LUETKEMEYER. The PPP program, I just want to talk about it for a little bit with regards to the forgiveness aspect of it. We just got a letter back from Mr. Kelly within your office there and he was telling us that there is still roughly a little over 36,000 PPP loan forgiveness applications that have now exceeded the 90-day window requirement within which the SBA should begin to administer this forgiveness program. What is your solution on that? How can we get this fixed? Ms. GUZMAN. For context, the SBA has processed over 60 percent of the 2020 PPP loans for forgiveness. That 36,000 represents about 1 percent of the total and we are committed to trying to work through those issues with the lenders. The Office of Capital Access obviously has been collaborating with the lenders to try to figure out how we can help their review process. On average, it takes about 6 days for the SBA to process forgiveness once the lender has signed off. And so we are working in partnership with them to solve this issue. Mr. LUETKEMEYER. Is there an ability to contract that out so we could speed that up? Because the next round of forgiveness is just around the corner here with this last tranche of PPP money. Is there a way we can speed that up, make sure that this gets done in a more timely fashion? Would contracting it out be helpful? Ms. GUZMAN. I am not sure that contracting out would be helpful but we have been working with the lender groups. I have been meeting with them myself, as well as Patrick Kelley to come up with solutions to try to streamline this system. Obviously, we have a simplified process so that $150,000 to $2 million loan sizes are obviously what we are looking at to try to streamline it. The demand is going to increase if we shift towards forgiveness. So I look forward to partnering with you on that. Mr. LUETKEMEYER. Very good. Because I know we appropriated lots and lots of money over the last two or three bills here to be able to do this. So we either need to be hiring more people or we need to be contracting this out so this can get done in the timely fashion the way it is supposed to. So I look forward to working with you on that, Administrator Guzman. With regards to communication, we started out I think on the right foot and it took about a week to get our first call set up but we finally got that done and we were able to respond pretty quickly to my first initial letter. But yesterday, or I guess last week, we finally got a letter in response to something we did 2 months ago. And I know my colleagues are very concerned. You are going to get a lot of questions on this today about communication. Chairwoman VELAZQUEZ. Mr. Luetkemeyer? Mr. LUETKEMEYER. Yes, ma'am. Chairwoman VELAZQUEZ. Time has expired. Mr. LUETKEMEYER. Okay. Chairwoman VELAZQUEZ. You have it. Mr. LUETKEMEYER. We will send this question in written form to the administrator. We thank you, Madam Chair, and yield back. Chairwoman VELAZQUEZ. Thank you. The gentleman's time has expired. Now the gentlelady, Ms. Davids, from Kansas, is recognized for 5 minutes. Ms. DAVIDS. Thank you, Chairwoman. And thank you for holding this hearing. I also want to say thank you to Administrator Guzman for joining us today. We know that even with the rising numbers of vaccines and vaccinations getting into people's arms, even with the decreasing numbers of infections that many small businesses are still feeling the impacts of this pandemic and there are still a lot of financial and logistical hurdles that face small businesses throughout the economic recovery and reentry. And I know that Ms. Guzman and our Committee and all my colleagues remain committed to supporting our small business community through all of these challenges. I am going to piggyback a little bit on some of the comments that the Ranking Member shared. In February, my office raised concerns with the SBA about the fraud and abuse and the PPP and EIDL programs. In part, it is because a number of Johnson County residents, which is in the Third District in Kansas, have been the victims of identity theft and fraud that took place in the EIDL program. And I have urged the SBA to focus on these cases, and it sounds like you are. Because they are not only a misuse of taxpayer funds but also directly and personally impacting the constituents in my community. Ms. Guzman, or Administrator Guzman I should say, I would love to hear you talk a little bit about the work that the SBA is doing to eradicate the fraud and waste and abuse from the EIDL program. And then if you could also talk a bit the ways that the SBA is working with the victims of identity theft and fraud that is taking place through either EIDL or PPP just to ensure that those victims are not held personally liable and that they are made whole. Ms. GUZMAN. Thank you for that. As I had shared, we are implementing controls and evaluating on an ongoing basis, an iterative process to stay best in class, to prevent fraud. And that happens at the program design phase 41:23xxx way. So we are really committed to this issue. We have obviously put in a lot of specific frameworks in place across our capital access programs, including PPP and the Restaurants program. And then within our Office of Disaster Assistance on the Shuttered Venues, as well as the EIDL program. We are really committed to making sure these funds get into the hands of those businesses as it was intended and we are seeing enormous drops now that we have implemented those controls. However, in February, we did impellent a process to help businesses through identity theft issues as clearly that was a huge problem in the beginning of these programs. And so we want to make sure that businesses are supported through that process. There is now a support system and a process in place for them to reach out to the SBA, get assistance in fighting that specific identity theft case. And we actually have hundreds of investigators on support with the IG to help prevent, help investigate and actually pursue any cases of fraud as we take all cases very seriously. Ms. DAVIDS. Thanks. I appreciate that. If necessarily, our office, of course, will reach out if we are hearing things that continue to be of concern so that you are aware of it and are able to address it. I appreciate that. And then the second thing, you mentioned a little bit about restaurants. Restaurants, bars, the shuttered venues have obviously been hit especially hard during this time, which is why we targeted resources towards those small businesses. I know the demand for those funds are oversubscribed. I am curious if you could talk a little bit about the expansion of eligibility or allowing for additional funds to continue these programs. In your view, does that make sense? And is it something that we should be working toward? Ms. GUZMAN. We have seen a huge demand as I said. Over $76 billion in requests on the Restaurant program. On the Shuttered Venues program, over $11 billion but it looks like applications are still coming in. We are still accepting applications but it looks like there might be enough funding for that in addition for them to get supplemental. But on the Restaurant Revitalization Fund, we are happy to provide any data and support Congress if they make that decision to replenish that fund and support restaurants through this time. We are still seeing obviously a huge demand and this assistance is helping them keep their doors open. Ms. DAVIDS. Thank you, Administrator. I appreciate you being here and your testimony today. And Madam Chair, I yield back. Chairwoman VELAZQUEZ. The gentlelady yields back. The gentleman from Minnesota, Mr. Hagedorn, is recognized for 5 minutes. Mr. HAGEDORN. Thank you, Chairwoman Velazquez. I appreciate you bringing up the fact that Ms. Yellen was not here today. Thank you for doing that on behalf of the Committee. Administrator Guzman, as a Member on the Republican side of the aisle, I can assure you that every colleague that is on the Committee that I have served with in both the last Congress and this, has tried to in a bipartisan way pass bills that are going to help all of the American people, particularly our small businesses in this instance, get from one side of the coronavirus to the other. And we did that in a number of ways with a bunch of different programs but we wanted to treat everyone equally. And just last Thursday, I, along with my fellow Republicans, sent you a letter talking about the Restaurant Revitalization Fund. And we do not really believe that everyone is being treated equally when it comes to that particular program. For whatever reason, the Biden administration, the Democrats put together a priority list which prioritizes a lot of different restaurant owners, and they are great and we want to help them all. But for whatever reason, the priority list, the people who were not on that list were not allowed to be funded at this time because you closed the whole portal the very day that the priority list was set to end sending in applications. For the record, can you explain to us the characteristics of the people that are barring restaurant owners who were not on the priority list? Ms. GUZMAN. Sure. Of course. The initial outreach that SBA did was extensive with the National Restaurant Association, as well as the Independent Restaurant Coalition, to reach all of the businesses. We informed everyone that this was ``first come, first serve'' and that everyone should apply, despite what the processing priority was going to be for those first 21 days. And I think that is reflected in the 372,000 applications. Only 214,000 of those are for the underserved or priority groups which includes, of course, veterans, women, and socially and economically disadvantaged individuals. Mr. HAGEDORN. Who is not on the priority list? That was my question. Ms. GUZMAN. Well, the priority list includes women, veterans, and socially and economically disadvantaged individuals. Mr. HAGEDORN. Who is not on the priority list? Ms. GUZMAN. Those individuals that do not fall into those categories, if they are not socially or economically disadvantaged as outlined. Mr. HAGEDORN. I will reclaim my time. It would helpful if we would just be honest about it. So anyway, the portal closes. The only people at that point who are going to be funded are people on the priority list. One hundred thousand or more bar and restaurant owners across the country that are not part of the priority at this point will not be funded. They happen to be, let's just be honest with it, White men that own bars and restaurants. Those are the folks. How is that not discriminatory or even outright racist? Ms. GUZMAN. Well, you know, White men who either have partners who fall into those categories, it is not 100 percent ownership. It is, you know, 51 percent. In addition, veterans are able to access this program. And what I would say is that the priority, while the applications closed, we have all these applications and we are beginning to process all applications, nonpriority as well. There were also small business set-asides and so some of those small business set-asides remain and so those will also, you know, businesses that fall into those categories will have an opportunity to be funded. Mr. HAGEDORN. But those are the only people who were not part of the priority. So it makes sense to me that that would be discrimination in any sense. The other thing I would add is that how can we be sure that illegal aliens are not receiving this money before U.S. citizens? Ms. GUZMAN. We know that restaurants are job creators, clearly, and immigrant entrepreneurs just as much so, they are all job creators. They are all taxpaying. You have to be based in the U.S., a tax paying entity in order to access this program and that is the threshold that we follow. Mr. HAGEDORN. So there is no assurance of that. Look, I think it is bad enough that when a government, federal government picks winners and losers, that is socialist policies. And to do so based on race, and even putting illegal aliens ahead of U.S. taxpayers to me does not make any sense. We should all be treated equally. We should all have the same opportunity. And right now it does not seem it. It seems like there is a big segment of our population who happen to be bar and restaurant owners who are not being treated equally. And I hope that we would reject that type of racial politics. I yield back. Chairwoman VELAZQUEZ. The gentleman yields back. Now we recognize the gentleman from Minnesota, Mr. Phillips, for 5 minutes. Mr. PHILLIPS. Thank you, Madam Chair. Welcome, Ms. Guzman. All of us are hearing about the current programs--PPP, EIDL-- not meeting the needs of certain heavily impacted small business industries. Fitness and wellness being a good example. Has the SBA considered recommendations to this Committee on some alternative solutions perhaps to buoy these small businesses? Ms. GUZMAN. We do. We hope to continue to serve PPP until it is over, the smallest of the small businesses, and including those highly impacted industries referenced. And so we do believe that there is opportunity to access that program as it was opened up more for sole proprietors and independent contractors to change the way that we assess the dollar amounts of that program. So I do believe that is still an opportunity. In addition, of course, you have your targeted EIDL Advance Program that we have been pushing out. There are specific eligibility requirements across that program, but in early June, we will be opening up that program more broadly to all those in the eligible categories outside of those who previously applied for EIDL Advance. And so we think that is another opportunity to support these underserved businesses, impacted industries that still need relief. Mr. PHILLIPS. Okay. And Ms. Guzman, any potential to expand the SVOG program to include fitness operators? Ms. GUZMAN. The statute on the SVOG was very specific in many ways and very restrictive about the eligibility requirements, and SBA is following that guidance from Congress. Mr. PHILLIPS. Okay. Ms. GUZMAN. At this time there is no way to expand that. Mr. PHILLIPS. Okay. I just wanted to make sure my advocacy is clear relative to certain industries that really have struggled disproportionately. My next question is about the Restaurant Revitalization Program as it relates to closed locations in determining eligibility. Despite the SBA indicating that closed business locations are ineligible, which is I think on Form 3172, Item 3, some are being shut out from receiving the funding to keep the businesses afloat because the forms require them to count closed locations amongst their operating entities. So will the SBA provide any guidance and updates in its forms that reflect that restaurant locations not doing business as of March 13, 2020, and those permanently closed will not prevent a group from qualifying for the RRF? Ms. GUZMAN. I will go back with my RRF Team to explore that issue and get back to you. Mr. PHILLIPS. Okay. I appreciate that. Lastly, when the Committee heard from the GA and SBA Inspector General, we learned that while millions of America's small businesses have benefitted from the programs, SBA was repeatedly warned that the speed in which the programs were implemented left the agency with limited safeguards to identify and respond to risks such as improper payments and clearly fraud. I am concerned about the potential for fraud in the Restaurant Program as well, as some of my colleagues have already indicated. With the Ranking Member of the Subcommittee on Oversight, Investigations, and Regulations, the two of us have introduced legislation to require the SBA to report to Congress on the plan, their plan, your plan, and the steps that have been taken to ensure that the resources within the program reach the businesses in need. Can you share with us, the entire Committee, what steps, if any, that you have taken so far relative to oversight? Ms. GUZMAN. On the Restaurant Revitalization Fund specifically, we have implemented industry best practices, as well as strong controls, fraud controls in place to ensure that there is limited fraud. In the program, we have reviewed our full plan with the IG and GAO and feel comfortable with the current process that we are following to reduce that and minimize that risk wherever possible. And it is an iterative process and we continue to look at upgrades as we move forward. Mr. PHILLIPS. Okay. If anything, it unifies Democrats and Republicans in this case. It surely is relative to prevention of fraud and assured dollars are being used appropriately, effectively, and efficiently. So we thank you for your attention to that. With that, Madam Chair, I yield back. Chairwoman VELAZQUEZ. The gentleman yields back. Now we recognize the gentleman from Minnesota, Mr. Stauber. Mr. STAUBER. Thank you, Madam Chair. And Administrator Guzman, I appreciate you being here today. I am extremely frustrated with Secretary Treasurer Yellen not following the law. As the Chairwoman eloquently stated, it is her responsibility to follow the law and be here. And I equate my frustrations with both the Chairwoman and Ranking Member Luetkemeyer for the comments against Yellen for not showing up. It is just unconscionable that she is not here, blatantly not following the law which says, I think, a lot about the individual. Now, Administrator Guzman, how many small businesses are organized as a subchapter C corporation? Ms. GUZMAN. I do not have those exact numbers. It represents more of the employers than small businesses as a whole. Mr. STAUBER. Can you give us a guess? Can you give us a guess? Ms. GUZMAN. I cannot give you a guess. I apologize. I do not have those numbers off the top of my head. Of course, I have looked at it because obviously, it is not, you know, there are some tax benefits we have looked at before and small businesses category. Mr. STAUBER. Would you say hundreds of thousands? Ms. GUZMAN. Oh, I am sure. Mr. STAUBER. Okay. Has the Biden administration proposed increasing the corporate tax rate, thus increasing taxes on these one hundreds of thousands small businesses that are organized as a subchapter C corporation? Ms. GUZMAN. You know, I know that small businesses across the board have average revenues that are very small. I mean, if you look at the Office of Advocacy's report, under $50,000---- Mr. STAUBER. And Administrator Guzman, because my time is limited, the question was, has the Biden administration proposed increasing the corporate tax rate on these subchapter C corporations? Ms. GUZMAN. Those should not. We are focused on trying to remove some of those loopholes for the larger entities. We do not intend to affect the small entities. Mr. STAUBER. Is that a yes or a no? Ms. GUZMAN. To my understanding, we are not focused on the small entities. We are focused on the larger corporations and the loopholes that exist for some of those entity types. Mr. STAUBER. Administrator Guzman, how many small businesses are organized as pass-through businesses? Ms. GUZMAN. Again, I do not have those numbers offhand and I could not share those with you. But I am happy to follow up with your staff and we can have a more---- Mr. STAUBER. Administrator Guzman, there is approximately 95 percent of small businesses that are pass-through. Has the Biden administration proposed rolling back the Section 198 deduction on these pass-through incomes, thus potentially increasing taxes on some 95 percent of small businesses that are organized as pass-through businesses? Ms. GUZMAN. I am not familiar with the specifics so we will have to follow up. But I appreciate the question and, of course, small businesses seek simplicity. They are obviously, you know, it is critical that we are able to help them both on the revenue side of the equation as well as support them with a tax structure that does not favor large corporations. Mr. STAUBER. Will the Biden administration increase taxes on pass-through corporations? Ms. GUZMAN. Again, I do not have those specifics. Mr. STAUBER. How will a substantial increase in a capital gains tax and regulation help small businesses ``build back better''? Ms. GUZMAN. I appreciate the line of questioning around the tax issues for small businesses. Obviously, it is really critical that our economists continue to look at ways that we can improve the economy and help those small businesses, you know, across the board. Again, the focus is on traying to ensure that the system is equitable for our small entities, as well as large corporations and ensure that---- Mr. STAUBER. Administrator Guzman, in light of time, I just have 30 seconds. Ms. GUZMAN. Sure. Mr. STAUBER. Will the increase in the capital gains tax help or hurt small businesses? Ms. GUZMAN. It will depend on the size and scale of those investments. So I cannot peak specifically. I do not have the analysis. Mr. STAUBER. So you cannot answer the question whether capital gains will help or hurt small businesses? Ms. GUZMAN. I do not have the full analysis, economic analysis on that. Mr. STAUBER. Madam Chair, I yield back. Chairwoman VELAZQUEZ. The gentleman yields back. This is the reason why we need Secretary Yellen here. The SBA administrator is in charge of programs that have nothing to do with tax policies. Now we recognize Ms. Newman from Illinois for 5 minutes. Ms. NEWMAN. Thank you, Chair Velazquez. And thank you, Ranking Member, for putting this together. Administrator Guzman, welcome. So I am just going to refer to my colleague's comments just right before me. By and large, when you have spoken to the Biden administration at length, they are making sure that small business is not affected by any tax increase of the largest of companies. And again, I stress that the Biden administration has made--in fact, that is a line in the sand I would be willing to commit to from the Biden administration. So that for the record. And then secondly, capital gains has been studied time and time again. It never affects small businesses. So I encourage him to look that up. But my question for you, Administrator Guzman regards two things. I know that you have hit the ground running since March 17th. A lot going on very obviously. But structurally, the first thing you do when I have gone into an organization is to look at the structure of the organization. Have you made enhancements or improvements across your leadership? And you do not have to get into hiring/firing, but have you reorganized in any way that will help address some of the issues that have been cited? Right? Data integrity. There is a little bit of fraud out there, and some of the other bigger issues. So if you can talk broadly about your structural reorg. Ms. GUZMAN. Well, the number one thing is that we continue to look at the symptom process and that includes the structure and how our departments are functioning under the leadership. However, across the board what we have tried to implement is an enterprise-wide approach. You know, breaking down some of those silos and increasing collaboration across the board. A great example is in the EIDL and PPP programs. Our Office of Capital Access and Officer of Disaster Assistance are working more collaboratively now with the Office of Field Operations so that those boots on the ground at the SBA and district offices across the country are able to access information on those loans for our constituents and be able to help them through the process. Previously, that was shut down and so we reimplemented that as an example. So that cross-collaboration, enterprise- wide approach, I have definitely already been started and we will continue to look at other improvements specifically in departments as we move forward. Ms. NEWMAN. Thank you for that. Second question is with regard to Community Navigator. I thought this was a brilliant program. You know, about 80 percent of my GDP in Illinois 3 are companies under 15 employees and under $2 million in net revenue. And therefore, these folks, the owners, and they are largely family owned, are working very hard every day on their business and do not have time to navigate onerous documents. And so the Community Navigator Program I think is brilliant but I know that we are not quite there yet. Can you give us an update on when those navigators will be available and if you are going to use consultants and volunteers and the like. So if you can share. Ms. GUZMAN. Yes. On the Community Navigator Pilot Program, the Notice of Funding Opportunity was released yesterday. We have a 45-day open period for nonprofits, both national, as well as local, regional, to apply to either be a hub or a spoke in the system. Obviously, the ultimate goal is to get hyperlocal with authentic and competent local organizations who can help businesses navigate the resources that are available to them and hopefully better access in the future. Ms. NEWMAN. Great. Thank you very much for your time. Thank you for being here. And I yield back. Chairwoman VELAZQUEZ. The gentlelady yields back. Now we recognize the gentleman from Texas, Mr. Williams. Mr. WILLIAMS. Thank you, Madam Chairman. I am a small business owner. Have been for 51 years. I am also the author of the Save Our Stages bill that we have been talking about today. Madam Chairman, you are the head of the Small Business Administration; correct? Can you hear me, Madam Chairman? Ms. GUZMAN. Are you speaking---- Mr. WILLIAMS. You are head of the SBA; right? Chairwoman VELAZQUEZ. Administrator. Ms. GUZMAN. Yes. Administrator. Mr. WILLIAMS. Okay. All right. So my question is, have you ever met a payroll? Have you ever started a small business? Have you ever drawn a line of credit? Have you ever sold a product? Ms. GUZMAN. Yes, I have. I come from a family of small business owners and I grew up working. Mr. WILLIAMS. Okay. And just to help you along the way, let me tell you, on these taxes you are getting asked about, just remember this: low taxes helps business, high taxes hurt business. Now, I sent you letters on February 4, February 25, March 18, April 9, April 15, and April 19 to try to give my constituents an update on the Save our Stages and the PPP Program. And like we have heard today, to date I have not received one response, even with the Chairwoman being on these letters with us. So what you are doing, you are ignoring my requests. You are blowing me off. You are blowing 700,000 people off in my district in Texas that sent me to Washington to help fix problems. So Madam Administrator, when we spoke on the phone last month, you said that these communication problems would be fixed and yet nothing has changed. Not only for me, but for others. So what are you going to do to get these communication issues fixed? Or should we just talk to lobbyists? I mean, we are hearing more from the lobbyists than we are from your office. So should we talk to you or lobbyists? How are you going to get this fixed, and with a short answer, please. Ms. GUZMAN. I remain committed to transparency and collaboration. And we have done over 100 briefings to date. We are providing weekly/monthly reports. Mr. WILLIAMS. Okay. Ms. GUZMAN. An increase in outreach to our Oversight Committee. Mr. WILLIAMS. But you have failed to call me back. Second question. Today marks 151 days since the Shuttered Venue Operator Grant Program was signed into law by President Trump. I am the author of that. We have seen countless music venues and movie theaters go out of business while the rest have been struggling to keep their doors open until this 1:04:58xxx assistance hits their bank accounts. And as these businesses have been waiting while the Small Business Administration struggles to get the program off the ground, the agency turned all their focus to the Restaurant Revitalization Fund and got funds in bank accounts within 7 days of the application opening. To the date that now has sent nearly $28.6 billion out the door while the Save Our Stages program has delivered absolutely zero. Nothing. So it is hard to classify the SBA's rollout of this program under your watch as anything but a total disaster and a total failure. So on behalf of 12,000 venues who have waited over 5 months, when will these businesses see the money? We understand today through the lobbyists, we have learned that, and was the problem this way because this was a President Trump thing and you just pushed it to the side like we saw so many with the Biden administration? So why can we not get it right like we did with the restaurants? Ms. GUZMAN. I appreciate that question. And to clarify, the Shuttered Venues Operator Grants Program is being administer by a whole different team, our Office of Disaster Assistance. We actually placed the Restaurant Revitalization Fund in a different office to ensure resources were available for both. Mr. WILLIAMS. Then Madam Chairman, why do you not give it to that group and let them get it out? Ms. GUZMAN. Actually, this team has been working really diligently around the clock. They are capable and being effective in terms of finally overcoming some of the initial technical issues that we experienced with the vendor of this program. Obviously, we have had over 13,000 applications and we are working through those as quickly as possible. This was a much more complex program as written. Some of those learnings, yes, were taken as the RRF was written so that we had some simplification in the process---- Mr. WILLIAMS. I hear you. I have got another question but it is going to be hard to tell those people that. Okay? Now, thirdly, building off this last question, when we say that there has been zero money delivered to Save Our Stages, that is just talking about the first priority group. There are two more groups that will likely be waiting until July to receive any money at the rate we are currently moving. So additionally, we saw the RRF that the money ran out for the first priority group after they were able to apply. So Administrator Guzman, can we expect to see the same numbers in the Save Our Stages Program with a great deal of businesses being left out of any assistance at all as we did with the Restaurant Revitalization Fund or should we just ask the lobbyists? Ms. GUZMAN. We actually have applicants from all of those priority groups. You know, the 1:07:39xxx. We have about 4,000. We have another couple of thousand in the 70 percent and another 4,000 in the 25 percent. So we encourage everyone to apply. We do not anticipate that this money will run out. Mr. WILLIAMS. They do apply but they cannot get the money. Ms. GUZMAN. Correct. We are processing them as we go in those priority categories. However, based on the demand so far that we have seen, we do believe that we have enough funding. Mr. WILLIAMS. Well, you need more people then, I guess, to help get it done. Anyway, I think my time is up. Madam Chairman, I yield back. Chairwoman VELAZQUEZ. The gentleman yields back. Now we recognize the gentlelady from Georgia, Ms. Bourdeaux. Ms. BOURDEAUX. Thank you, Chairwoman Velazquez, and Ranking Member Luetkemeyer. And thank you, Administrator Guzman, for joining us today and for reaching out to the many small businesses in my district and holding a forum here to help them as you rolled out the Restaurant Revitalization Program. The Paycheck Protection Program, as you know, has provided millions of small businesses with a lifeline to keep their doors open and employees on the payroll over the past 14 months. But now that the PPP funds are virtually exhausted, we are hearing from more and more small business owners who will be seeking loan forgiveness in the coming months. Nearly 2 million 2020 PPP loan recipients have yet to apply for forgiveness, and I know that they are anxious to better understand how they can obtain this. So I was just wondering how the SBA is working with lenders to reengage borrowers and ensure that they understand how to apply for loan forgiveness. And have you observed a difference in the speed or manner in which the large versus small PPP lenders have processed their borrowers' forgiveness applications? Ms. GUZMAN. We are working closely with the lenders to just make sure that we have the systems in place to support the forgiveness applications that will be coming in. In addition, we are looking to be creative about how we can find innovative ways to streamline that process as we move forward into forgiveness, especially for, as I mentioned previously, the $150,000 to $2 million range that does not have the expedited process. And what we have seen in the past is that it is all different sizes of forgiveness loans of the 60 percent that we processed so far from 2020 loans. And so we have not seen any specific trends. I think just overall, folks are looking for simplicity, looking for assistance, and we hope to continue to provide the outreach necessary to support them. Ms. BOURDEAUX. Okay. Well, thank you. One other question here. EIDL. About the EIDL program. It has provided over $200 billion in relief to small businesses since last March but less than $10 billion in new loans have been approved since February. And you mentioned in your testimony that the Small Business Administration still has about $263 billion in loan program authority remaining. Do you have information on the amount of unspent funds appropriated for the COVID-19 subsidies? Ms. GUZMAN. Yes. And what we are doing on EIDL, obviously, I made that initial change increasing the limit from $150,000 to $500,000. We saw $1.5 billion in demand come through from just that change alone. And as I committed, we will be increasing that to $2 million, which is the true authority of the EIDL program so that we can continue to support businesses that need that assistance. There is $263 billion in authority left and we will be focused on making sure that those businesses who are interested in it can access the program. Ms. BOURDEAUX. Just to follow up, the $263 billion in loan authority represents how much in the funds appropriated that are used to support that $263 billion? How much remains of the funds appropriated in that program? Ms. GUZMAN. I will have to follow up with you and get those specifics. Ms. BOURDEAUX. Okay. We appreciate that. And if the maximum loan amount is increased to $2 million as you mentioned in your testimony, how much of those funds do you anticipate will be used? Ms. GUZMAN. We are not sure yet of that demand as we roll out that program by July. We are hoping to finalize the technology to accommodate for those increases. We will start to get a better sense of those numbers and can share that with the Committee at that time. Ms. BOURDEAUX. Okay. Thank you so much. I yield back the balance of my time. Chairwoman VELAZQUEZ. The gentlelady yields back. Now we recognize the gentleman from Pennsylvania, Mr. Meuser, for 5 minutes. Mr. MEUSER. Thank you very much, Chairwoman. And thank you, Administrator, for being with us. And certainly, thanks to our Ranking Member Luetkemeyer. So the PPP loans were quite successful. They were not perfect. They were a lifeline. We did a lot. It was a very holistic approach to assuring that they were as efficient, valid, purposeful as possible. Secretary Mnuchin and many Members and banks and small businesses. It was very inclusionary on how to get it right. It still is very important, of course, and I am hearing from many businesses as well as banks that there are problems with the forgiveness initiatives, primarily related to loans between $150,000 and $2 million and the loan forgiveness over $2 million. I am not sure any have been forgiven as of yet. Now, we all understand that there is going to be an audit of the loans over $2 million, but Administrator, is there a plan? Because currently, it is a problem for banks and businesses. We are not seeing a real process for forgiveness of loans in these categories. Can you comment on that, please? Ms. GUZMAN. For the over $2 million loan categories, yes, there is a specific process. It is an individual review. Obviously, those were flagged for SBA loan review due to the amount. And there is a process that SBA is following to review those within the same partnership. And so I know that those, obviously, this is a huge task that the SBA is taking on and will increasingly do so as those payments come due. So we are hoping to try to come up with a streamline process as well for those $150,000 to $2 million bucket as well as you mentioned to make sure that those can be processed efficiently and give us the time and resources to be able to address those individual 1:14:36xxx. Mr. MEUSER. Sure. Thank you. Is it a priority? And will we see some sort of plan that will be put into effect? Ms. GUZMAN. Yes, it is a priority. We are working on that currently. And so hopefully we can follow up soon with some specifics. Mr. MEUSER. Great. Administrator, Representative Stauber brought up the 20 percent business income deduction that occurred in the Tax Cuts and Jobs Act. Many small businesses are concerned about the Biden administration's plans for tax increases. Can you tell us what you think about the 20 percent removal from small businesses? And are you weighing in with the Biden administration on behalf of the millions of small businesses in our country to assure or do what you can to keep that deduction in place? Because that deduction, I think you know, was not a gift to the wealthy. It helped small businesses expand, get stronger, and hire more employees as we saw with a 3.5 unemployment rate. Your thoughts on the 20 percent? Ms. GUZMAN. Yeah. I mean, I closely collaborate with the Office of Advocacy as well. It has the economists that can do the research as well. Clearly, I am not a tax expert. That is not my forte. I am administering these programs on behalf of the Small Business Administration, relief for small businesses. So I continue to try to track those issues and report up our findings to the necessary channels. Mr. MEUSER. It is a major interest and a factor for small businesses' growth, survival and just maintaining and working through the recovery. So I think the SBA administrator should be very much an advocate for the health of small business. As well, you know, it came up before about capital gains. And that is very important. The idea that the Biden administration wants to raise capital gains from 20 percent to 43 percent does have a great effect. If a small business is looking for a partner and/or thinking about selling and retiring and passing the business along, that transfer has to take place. That is going to cost them 23 percent, which is $23,000 per $100,000. So it is not a trivial thing. It is very important. The other thing I want to bring up, please, is the unemployment compensation. Ninety percent of my small businesses in my district are literally diametrically opposed to President Biden's comment that the additional supplement of unemployment compensation as the president said is not measurable for the level of workforce availability. And I will tell you this. I do weekly business calls with dozens of small businesses and virtually 100 percent say it is the number one issue, if not the number two issue that they face. A headwind that they face. Can you comment on that? Do you believe that where some of this is being targeted in some states and, you know, it is going to by law continue to supplement through August. Again, as an advocate for small businesses, I would hope you would recognize that, be inclusionary, talk to the small businesses and get directly from them what their concerns are and work on their behalf. Chairwoman VELAZQUEZ. The gentleman's time has expired. Mr. MEUSER. I yield back, Madam Chair. Thank you. Chairwoman VELAZQUEZ. Now we recognize the newest Member on the Committee, the gentleman from Louisiana, Mr. Carter. Welcome to the Committee. Mr. CARTER. Thank you very much, Madam Chair. Thank you very much for your very warm and gracious welcome. I am honored to be a part of this Congress. Honored to be a part of this Committee. Ranking Member Luetkemeyer, good morning. Or good afternoon I should say. Well, I guess it is still morning. Thank you all very much. And Administrator Guzman, I would like to personally thank you. I know your job has been difficult. I feel the frustration of all of the Members here. I share their frustration, but I also recognize that you have a very difficult task. There is nothing in the playbook to address a worldwide pandemic, the pain that it has caused for many of the people throughout our country. Certainly in the Second Congressional District we are no different. So I applaud your efforts. I feel the frustration of my colleagues who expressed concerns about the availability of funds, the rapid nature of getting those funds, and the frustration that we hear from our businesspeople. So at the risk of being redundant, I will try to not repeat questions that have been asked. But I will share that, as you know, I represent the Second Congressional District, which is Louisiana, home of the Historic French Quarter and our beautiful river parishes up and down the river from West Jefferson to West Baton Rouge Parish. One of the issues that I hear repeatedly from small businesses is the ability to access PPP as rapidly as some of the larger companies that have access to lawyers and consultants and accountants. What plans, if any, do we have to address perhaps in the next round of resources to assist small businesses who oftentimes miss out because they do not have access to the resources of accountants and consultants to prepare paperwork? Ms. GUZMAN. Yes. And obviously, once the Community Navigators Pilot Program is launched and those organizations are brought on board to fully help the SBA and communicating resources and supporting businesses through process of relief, that will obviously make a big difference. But I will submit that on the Restaurant Revitalization Fund Program, we were able to effectively, through partnerships, reach to all different size businesses, as well as from different communities and regions across the country. And so really, that is reflected in the application, the interest, the access. And I think what also was attractive was that we created a simple process. Leveraging technology, using partners such as Square and Toast and other point-of-sale vendors to help us access those restaurants who are underserved so that they can connect to the platform and apply for the program. So I think that there are some learning in our Restaurant Revitalization Fund in terms of how we do our outreach, how we are structuring our programs so that they are more customer friendly so that businesses of all sizes can access the program easily. And we will be applying those types of monies across our program as we move forward. Mr. CARTER. And Madam Administrator, I have some thoughts that I would like to share with you and my staff will be preparing some documents to share with you some thoughts that I think may assist with kind of segregating those funds to make it easier for small businesses to access them. One final question as my time runs out. AS you know, in Louisiana, we are just about 15 years past Katrina, one of the largest hurricanes and issues ever to hit, natural disasters that ever hit Louisiana for certain. Many of our small businesses are still suffering and still paying back SBA loans from that situation and have since had other situations of similar magnitude, like COVID. What relief, if any, can we look forward to in the way of forgiveness of some of those Katrina- related SBA loans? Ms. GUZMAN. We did provide that relief on all our programs. We have extended payments on any EIDL loans to 2022. But in terms of any forgiveness, we would be happy to collaborate with you, work with you to provide you any information that you need about our programs and we will implement any programs that Congress directs us. Mr. CARTER. Very good. And finally, I would like to once again thank Representative and Chairman Velazquez for governing this meeting as smoothly as you have. And thank you, Administrator Guzman, for making yourself available. I yield back my time. Chairwoman VELAZQUEZ. The gentleman yields back. Now we recognize the gentlelady from New York, Ms. Tenney. Ms. TENNEY. Thank you, Chairwoman Velazquez, and Ranking Member Luetkemeyer, for holding this meeting. And I want to say thank you to Administrator Guzman for being here. We know that working at SBA is not an easy job right now, especially in light of the pandemic. And I might add, thank you for being here. I am very disappointed that Secretary Yellen has not made the effort to be here. She did speak before Financial Services in the past and really needs to fulfill her legal obligation to be here. So hopefully, we will be hearing from her soon. And I am sure Chairwoman Velazquez and Ranking Member Luetkemeyer will make sure that happens. But I wanted to just address the administrator. This is an issue that is really big in my region. Actually, it is across the country. I am a small business owner. Our family business is celebrating our 75th year here. We almost did not think we were going to make it because of the pandemic last year. So many of the programs put out by SBA and the CARS Act have been vitally important to us. But one of the big issues now facing every employer where I go, every business forum. It is the number one issue, is the enhanced unemployment insurance benefits extending through August and how that is putting a huge impact on their ability to attract and to get people to work and in some cases, their own employees back to work because the benefits are so strong. What is your opinion on that? And do you think that we can in some way target that relief instead of having this blanket coverage where we are hurting even seasonal employees, seasonal businesses, agribusinesses in my community. You know, ag is number one in my region. What do you think we can do to try to minimize that impact on small business owners? Ms. GUZMAN. From what I have heard from small businesses, it is the combination of factors, and definitely across the board, small businesses want help in making sure that their work is still safe as well to come back to work. And so that is why we have been emphasizing heavily the vaccination rates and by emphasizing the American Rescue Plan taxpayer, tax credit, rather, for small businesses to give time off to their employees to get that shot, as well as recover from it. Because we know that feeling safe in the workplace is also a big factor. Also, just the vaccination rates would help with the care economy and with schools being reopened fully for the children to go back to work because I am also hearing that that is a huge factor for a lot of the employees of these businesses is that they not only potentially fear of COVID in the workplace but as well that problem with having no care for children at home. So I do believe that the Biden administration focus on fighting COVID is going to go a long way towards helping our small businesses access workforce. Ms. TENNEY. Can I just reclaim my time for a second? I am not hearing that from small businesses. We have a fairly decent vaccination rate here, very low contraction rate, a low death rate in rural areas here. So my concern is many businesses either shut down entirely or invested a small fortune, which is a lot for businesses, tens of thousands of dollars into plexiglass, PPE, and other items to make it safe for employees to go back to work. We are not talking about our police officers, our firemen, our essential workers and all the other so-called essential. I think every worker is essential. But people who went back to work and are back working. We have to get our economy going. I am just concerned that if we do not have a more targeted approach, we are going to see a collapse in our economy and we are going to have a problem getting them back to work. Do you not think that that should be an issue that the Biden administration should be addressing with you as the key administrator, one that deals with small business? I mean, look, NFIB has said that almost 50 percent of businesses are specifically citing the enhanced unemployment as the reason that people are not coming back to work because they can wait it out until August. And we know that is partly true. I know a lot of people are working even though they might even be making less. Do you not think that is something the Biden administration should be doing to get our economy going again? Ms. GUZMAN. I know that we are looking at all the tools. And obviously, that support in the economy, those additional funds have also propelled our economy and supported business revenue creation at the same time. So, you know, it is not my position at the SBA to judge in terms of the best economic decisions to make overall for the economy but I know that that has been a shot in the arm in the economy to have that stimulus check distributed across the country. Ms. TENNEY. Right. But we are running out of stimulus checks. Just one more thing. You said you are a small business owner. I mean, a lot of businesses are C corps. You know, our business has been around a long time. We are small. We are a C corp. We are hurt by taxes. I think if you are a business owner, I think you can safely say that taxes hurt all businesses, large and small, but are particularly harmful to small businesses. And in an area like mine, 94 percent of the jobs created in my region are from small businesses. So we do not deal with the large business problem. So these taxes are going to really hurt our community. Ms. GUZMAN. As I mentioned earlier, this is really President Biden's focus on taxpayers over $400,000 is really the priority focus, including the S corporation taxpayers. But all of the exceptions that are typically benefitting small businesses--the rent, capital gains, passive income--will continue to apply. And so the budget includes provisions really to close those loopholes I reference that allow larger corporate taxpayers with income over $400,000 from avoiding paying certain taxes. And so that is really the focus as I reference earlier. So I appreciate what you are hearing from the constituents. I hear a combination of, of course, that plus the COVID issues and the care economy issues and education. So I look forward to continuing to partner with you to help support our small businesses. Ms. TENNEY. Thank you. I think my time is up. Thank you so much and I appreciate your testimony and for actually being here today. Thank you. Chairwoman VELAZQUEZ. The gentlelady's time has expired. Now we recognize the gentlelady from California, Ms. Chu. Ms. CHU. Thank you, Madam Chair. Administrator Guzman, since the start of the pandemic, I have been extremely concerned about the Trump administration's failure to collect demographic data on PPP recipients. It prevented us from understanding which types of businesses benefitted from the program at a time when so many were struggling. And that is why it was so significant that the Los Angeles Times had a recent investigation in which they reported an alarming finding that in L.A., businesses in majority White neighborhoods in the early days of the PPP loans received loans at twice the rate of majority Latino areas, 1.5 times the rate of majority Black areas, and 1.2 times the rate in Asian areas. So clearly there needs to be more help for underserved businesses. And one of the most important lessons of this past year is that community financial institutions can effectively reach businesses that are not served by traditional banks and they can do so at scale. Now, I have long championed the Community Advantage Program which leverages nonprofit, mission-oriented lenders and have authored legislation to give the program long-term stability by authorizing it for 5 years. So how can we expand the role of CFIs, such as Community Advantage in the small business lending ecosystem so that we can support an equitable, long-term recovery? Ms. GUZMAN. Well, one of the silver linings of the pandemic has been SBA's increased network of lenders that have been accessing the PPP program. And we hope to continue to partner with them, including those mission lenders, CDFIs and CDCs and others to make sure that we are supporting small businesses that are underserved because the data is stark in terms of access to these programs and the U.S. Chamber had a similar study which showed that Black businesses were unable to access capital at the same rate. Half the rate actually of White businesses. And so we continue to see that in the data and so the SBA is working hard to try to find a solution to partner with institutions that are serving these constituents as well as all of our traditional banking partners to better support through SBA programs capital access for these constituents. Ms. CHU. Thank you for that. Administrator Guzman, I wanted to ask about another issue which is the Shuttered Venue Grant Operator Program. I am proud to operate Southern California and the countless live venues, such as the Troubadour and the movie theaters that make our region so special. They were the first businesses to close and will be the last to reopen. And that is why the Shuttered Venue Program includes this supplemental phase for businesses still experiencing deep losses in the first quarter of 2021, like so many of the live venues in L.A. County. But because of the program delays, SBA already actually has the necessary data from the applicants to calculate both the initial loans and the supplemental loans right now. So given the delayed implementation of this program, can you discuss if SBA can help these businesses by automatically calculating and processing the supplemental grant awards to expedite disbursal of these funds? And are there tools that Congress can provide to help you do this? Ms. GUZMAN. Yeah. I mentioned before that the Shuttered Venues Operator Grant Program was a complex statute that we were implementing and the program design dictated by statute obviously had lots of control for eligibility requirements. There were so many different types of entities that were eligible with very unique requirements under each. And we worked very closely with our vendor and cross agencies to make sure that we were leveraging technology to the fullest and simplifying processes. And we are continually working through some of those issues to see how we can expedite as we go through in processing taxes and other issues. And so while the program has been delayed, I feel confident that we will start to roll out these funds as we have been doing this week and we appreciate the patience from the industry. Obviously, they do not have time to wait. Their rent is due and other expenses are critical for them so we are working and take this program very seriously in implanting it as quickly as possible. And so we look forward to any further input that you have specifically with certain venues and how we can improve the experience. Ms. CHU. Thank you. I yield back. Chairwoman VELAZQUEZ. The gentlelady yields back. Now we recognize the gentleman from New York, Mr. Garbarino. Mr. GARBARINO. Thank you, Chairwoman. And thank you to the Ranking Member for doing this. And Administrator, we appreciate you being here. I want to echo my colleagues' disappointment in Secretary Yellen's absence today. But I have a question. I have been in Congress as a new Member for a only a little under 5 months now. And prior to being in Congress, with my law practice and being in the State Assembly in New York, I dealt with SBA, the local offices, and they were very good in answering questions when I dealt with them. But my time now, and I have heard this from other Members as well, a lot of questions to your office have gone unanswered or been very delayed if they get an answer. Can you explain what is behind this underwhelming response? And if we cannot receive a response directly from you and your team, what recommendations do you have for us to get answers to the questions that we have? It seems like the communication right now between the SBA and Members of Congress is very bad. We would like to have something done in a timely manner. How can you help us with this? Ms. GUZMAN. Yes. And SBA is working to increase communication. It has increased dramatically in the Biden- Harris administration. And so just to confirm, as I said, we have had hundreds of briefings. We send out regular reports. And we continue to try to respond to all of these letters as quickly as possible. Understanding, of course, that these requests require career staff time as well as just sometimes days to pull these reports and that is disruptive to the process. Obviously, we are highly impacted by the scale that we have had to reach in order to serve small businesses which remains a priority and we will continue to try to get through all of your requests as quickly as possible. So we appreciate your patience. Mr. GARBARINO. I understand that. And I know you try to talk with small businesses, but a lot of small businesses contact us when they have problems with the SBA, so we send questions over. I spoke to the previous administrator, Ms. McMahon, and she told several of us that she prioritized responses to Members of Congress where she got back within several days. Is that something that we can count on your office for, that when a request comes in, when a question comes in from a Member of Congress that we can expect a response from your office within a matter of days? Ms. GUZMAN. Yes. And unfortunately, during a disaster it is a little bit of a different situation because we are so impacted by all these programs, unlike under Administrator McMahon. However, yes, it is a priority. My team knows it is a priority. Mr. GARBARINO. I think we had COVID all last year. Ms. GUZMAN. What we have tried to do in the programs is, as I mentioned before, is open up access to some of those portals, to our field operations as well. And we are also in touch with our local field office as they can also help navigate some of these specific issues. But yes, constituent requests, those customer requests, we are trying to open up and access more of our team Members to be able to answer questions like this. And so, yes, we will continue to try to work with you to speed that up. I do want to make sure that we will reach out to you and make sure your staff is in contact with our field office who has this expanded now access into our portals to be able to understand where loans are in the process. Mr. GARBARINO. I appreciate that. Thank you. And I have another question. Dealing back with the EIDL program and fraud, the fraud is extremely concerning, the amount of fraud. We know that the SBA's Shuttered Venues Grant Program was flagged by serious problems in the beginning. It seems that new reports come out monthly on these programs. In your response to these reports, we know the SBA plans to inquire and implement many of the recommendations that it gets from the SBA Inspector General, that it gets from the Government Accountability Office regarding these relief programs. Out of these recommendations that you have received from the SBA Inspector General and the Government Accountability Office, how many recommendations have you gotten and how many have you closed out? Which means how many have you implemented of those recommendations? Ms. GUZMAN. A lot of the requests, too, in a lot of the reports that we are seeing now are unfortunately assessing the portfolio pre in 2020. And so a lot of the controls were put in place post in 2021. And so, unfortunately, that is not reflected in a lot of the current reports. But we are working to close out as many of the IG and GAO reports as possible across the board and my teams are---- Mr. GARBARINO. Okay. I only have a few seconds. How many have you closed out, your team, to date? I believe you have had 32 recommendations. But how many have you closed to date and how many are open? Ms. GUZMAN. We will follow up with you to give you that exact number. Mr. GARBARINO. Okay. Thank you. I yield back. Chairwoman VELAZQUEZ. The gentleman yields back. Now we recognize the gentleman from Pennsylvania, Mr. Evans, for 5 minutes. Mr. EVANS. Thank you, Madam Chair. Madam Administrator, many small businesses in my district, especially minority-owned businesses are in desperate need of technical assistance. In your testimony, you mentioned that the American Jobs Plan will provide SBA the ability to create a national network of small business innovators and innovative hubs and technical assistance partners to ensure women, inventions, and rural businesses basically receive what they need. Could you please elaborate on this proposal and how it would work and the current resources? Ms. GUZMAN. Yeah. Obviously, the SBA has resource partners, our Small Business Development Centers, our Women's Business Centers who have expanded recently, including through HBCUs, as well as SCORE. And so with those resource partners, they play a critical role in helping us reach small businesses. But with the Community Navigator Pilot Program, we are going to be able to partner more extensively and resource partners are eligible to apply for that as well, of course. But the point of that is to create a hub and spoke model where there is an essential source of information and a network of more local navigators who can help small businesses connect to resources and help them understand the process, application process, et cetera. And so with that program, we hope to fund national as well as regional and local organizations to create that system of disbursing information about these programs as quickly as possible so that businesses that have traditionally been underserved will be able to access those relief programs. Mr. EVANS. So how would you say you think it is proceeding at this point? Ms. GUZMAN. We have just released the Notice of Funding Opportunity yesterday, and so we know that we have done extensive outreach with organizations across the country to make sure that they were ready to apply through the grant portal process and hopefully serve our small businesses through this system. And that includes diverse organizations and organizations across our regions that are underserved. Mr. EVANS. Madam Administrator, I thank you for your leadership and your organization, what they are doing. And I think the technical assistance is probably of utmost importance. Obviously, resources are important, but the technical assistance I believe is very important as a priority. Again, I thank you for your leadership. I yield back, Madam Chair. Chairwoman VELAZQUEZ. The gentleman yields back. And now we recognize Ms. Young Kim from California for 5 minutes. Ms. YOUNG KIM. Thank you, Chairwoman. I want to thank Administrator Guzman for joining us virtually, though I must say that I share Chair and Ranking Member and my colleagues' frustration, and I am also disappointed Secretary Yellen is not testifying today to discuss how Treasury is assessing the impact on a possible increase in taxes on small businesses. As one of the Members of Congress who helped craft the bipartisan PPP Extension Act, I wanted to follow up on some of the recent funding numbers that the SBA has been reporting and the decision to close the border. Let's acknowledge that the PPP application window will remain open for CFI lenders, so what specific steps did you take to alert all other lenders that the portal was going to close a few weeks back? And did you provide advanced notice to the lenders? If so, how many days or weeks in advance did you provide? Ms. GUZMAN. We continue to communicate with the lenders through our portal. That is how we communicate with them regularly in terms of where we are at in the system. Obviously, all the lenders have been tracking closely the remaining funds as we have been walking through this program and reaching the end. So I do not believe it should have come as a complete surprise to many and we informed them in advance that we were-- -- Ms. YOUNG KIM. All right. Let me reclaim my time. As a follow-up then, what should lenders do if they have an application with an unknown status? Ms. GUZMAN. If there are any lenders with hold codes in the system, we are working through those still. Those funds remain for those lending institutions and their ability to process them remains open. And they have not been shut out from the system. If it is for new loans, obviously, they can work through CFIs, whether it is NDIs or CDCs or CFIs, the partner, and make sure that those new applicants get through. Ms. YOUNG KIM. Thank you. The PPP Extension Act also extended application deadlines to the end of this month but it also gave SBA extra authority days to work through all error code issues for loans currently in the pipeline. So can you please provide us with a detailed response on how you envision the SBA using this 30-day period after the application window closes? So will all eligible applications that clear their error codes be able to proceed? Ms. GUZMAN. I am willing to work with all the lending institutions that still intend to move forward on any of their held applications to get them to completion. And so those extra 30 days will be helpful. There is a process in place for SBA to coordinate with the lenders to make sure that any information is cleared. That the borrower is informed through the lender of any requests for further information to release any of these holds. Ms. YOUNG KIM. Okay. Thank you. Well, next question. How are the SBA's entrepreneur development programs like SBDC, WBC, VBOC, SCORE, administered to avoid duplication and prevent fraud? Ms. GUZMAN. Across all of our grant programs, obviously, we take fraud seriously as well. Our SCORE partners, as well as our SBDCs, WBCs, have very strict--and VBOC, have very strict reporting requirements to the agency and we follow through with audits across the board as well. Ms. YOUNG KIM. Well, let me ask one last question here. Are there any current efforts to consolidate programs and resources to make it easier for small businesses to access resources in a one stop shop? Additionally, what efforts are you taking to combat fraud and protect taxpayer dollars? Ms. GUZMAN. Across our resource partners, obviously, they are all engaged in local ecosystem building to try to support, along with our field offices, small businesses and the support that they need. And so we believe that it a cooperative approach is most valuable to us and so we make sure that all of our departments are collaborating with these resource partners and have open communication to make sure that they are positioned well to support small businesses. And our field offices are really critical in bringing them all together. And that will apply towards the Community Navigator Pilot Program as well. We see that all these resources partners have been inundated during COVID and have been contacted by many new businesses for support and we hope that that engagement will continue as we move forward. In terms of fraud control or prevention of any misuse of those programs, again, our grants program management is positioned with processes to make sure that funds are used in how we intended them to be used to support small businesses with technical assistance. Ms. YOUNG KIM. Thank you. I see that my time is up. I yield back. Thank you. Chairwoman VELAZQUEZ. Time has expired. Now we recognize the gentlelady from Pennsylvania, Ms. Houlahan, for 5 minutes. Ms. HOULAHAN. Thank you, Madam Chair. And thank you all for being here. I have several questions, and my first one has to do with PPP loans and the forgiveness process. Through a bill that I introduced and that was signed into law as part of the Economic Aid this past December, SBA is now able to provide small businesses that received a loan of $150,000 or less with a streamline forgiveness process using the 3508S Forgiveness form. This was really a welcomed change for small businesses and lenders to be able to streamline the forgiveness process and to make it easier for our smallest businesses to get that relief. However, based on data that was released by the SBA, there still are a substantial number of borrowers who have not yet submitted, nor have been approved for forgiveness. And I have heard suggestions from advocates lately that simplifying the forgiveness application and associated requirements for all PPP loans between $150,000 and $2 million would further allow a more streamlined process. And it has also been raised that additional resources may be needed to help the SBA expedite reviews for PPP loans greater than $2 million. So as the agency is beginning to move forward and move their focus from the origination phase to the forgiveness phase, what kind of considerations are being made by you all to ensure that there is an efficient forgiveness process? Do you also feel that raising the current cap on PPP loans eligible for streamline forgiveness from $150,000 to $2 million would help you better serve our businesses? Ms. GUZMAN. Thank you for that. We are looking at best practices in that $150,000 and under range because clearly that simplicity is beneficial to our small businesses applying. We do want to apply similar type streamlined processes for the $150,000 to $2 million and are exploring our options currently. And so we welcome a partnership in trying to circle back with you once we have more specifics to recommend. Obviously, we are talking to lenders who have been implementing PPP to understand what they are seeing and what they are hearing in terms of why borrowers are not pursuing forgiveness at this time but we know that that cliff is coming with payments due and want to make sure that we move forward to create a system that they will access more readily. Ms. HOULAHAN. My apologies for my dogs in the background. Thank you, and I look forward to working with you on that as well. My next question has to do with concerns that constituents in my community have been raising with me related to--and I recognize you are facing unique challenges with the pandemic. But with your agency being asked to distribute federal assistance to small businesses, we are definitely hearing a lot more about customer service and the needs to have a more effective customer service. What recommendations do you have to improve the customer experience for those of us in our communities who are seeking assistance from SBA? Ms. GUZMAN. Some measures we have put into place but I have asked my staff to be as entrepreneurial as the small businesses that we serve. And obviously, be providing strong customer support and service is really critical for small businesses as they seek revenues every single day. And so we have tried to take that approach. With our small businesses, they obviously need information easily accessible as well as in simple terms. And so we have really been partnering externally with many organizations to better reach small businesses with authentic voices, people who can help them navigate and translate government to better support their needs. In addition, we have equipped our field with more information and direct access to our programs so that they can better support our small businesses and turn around these requests. Obviously, SBA has been inundated but we are working to try to find better ways with technology as well to streamline processes, including support to give small businesses answers and resources that they need ASAP. Ms. HOULAHAN. And I would look forward to working with you as well on that. It definitely is a trend, and I understand the volume that you are realizing right now with PPP and EIDL and a number of other large programs that you are implementing, some more successfully than others. But if there is anything that our office or this Committee can be doing to help you as you work through what best practices are on customer service, I would welcome that as well. I only have a half a minute left so I guess I would ask how we can be better supporting you on issues of fraud as well. If there is 20 seconds worth of ideas that you might have that we can help on the fraud area, that would be a welcomed last couple of seconds. Ms. GUZMAN. SBA is continuing to use resources. We have obviously scaled up on customer service, as well as our fraud teams. And so that support, that financial support for extra administrative funds has been helpful for that. So that continued support will be important going forward. Ms. HOULAHAN. Thank you. I have run out of time and I yield back, Madam Chair. Chairwoman VELAZQUEZ. The gentlelady yields back. Now we recognize the gentlelady from Texas, Ms. Van Duyne for 5 minutes. Ms. VAN DUYNE. Thank you very much, Chairwoman Velazquez. I very much appreciate the fact that you have called upon and recognized the importance of getting Secretary Yellen here to answer some of these most basic questions, and I hope that we will continue to push her and make sure that she does have an opportunity to speak directly to our Committee. Thank you, Administrator Guzman, for being here today. You have been unable to answer, or unprepared to answer a lot of the questions that have been proposed and posed to you by my colleagues, specifically those proposed impacts of the current administration. The impacts of increasing the minimum wage. Are you familiar that NFIB has found that 92 percent of small business owners felt the wage mandate would harm their businesses? Ms. GUZMAN. You know, I am familiar. I know as well though that there are other studies that show that there are other factors that are impacting the workforce and small businesses' ability to hire. Ms. VAN DUYNE. Oh, without a doubt. I mean, including the enhanced unemployment benefits. I was surprised when you said that you had not heard that so much. That what you had heard from small business owners was their questioning of coming back in a safe environment I think. Congresswoman Tenney was very clear that they have purchased and invested a lot of money into ways of making sure that they are coming back in a safe environment. So not being very clear about the enhanced unemployment benefits and the effects that that is having on small businesses, the increase on capital gains and the effects that that will have on small businesses you have been unable to answer. And quite frankly, not having any information about what the increase in the corporate tax rate would have on small businesses. Not just on the direct costs but on the indirect costs. For example, increases in utility rates. Administrator Guzman, you are charged with running the Small Business Administration that was created to aid, counsel, assist, and protect small businesses. And yet, you are not aware of many of the proposed increases and tax consequences that will directly affect small businesses that are coming out of this administration. I guess my question is, if you are not aware of the effects and the impacts of these policies that are coming down from the Biden administration, who is advising the administration for small businesses? Ms. GUZMAN. Well, I mean, I know that, as we have discussed this before, I have said President Biden's plan is really focused on closing those loopholes for the larger corporations. And I will---- Ms. VAN DUYNE. I yield back my time. I disagree. It is not just, it may be focused but they are increasing the corporate tax rate. When asked will that affect small businesses, what was your answer? Ms. GUZMAN. Only a very small percentage of small businesses are C corporations. We talked about that previously. Ms. VAN DUYNE. No, regardless of whether or not they are C corporations, will increased corporate tax rate affect small businesses? Ms. GUZMAN. Again, I mean, Biden's plan is focused on those who have earnings over $400,000---- Ms. VAN DUYNE. And I---- Ms. GUZMAN.--so yes, there will be small businesses that are included in that. Ms. VAN DUYNE. And---- Chairwoman VELAZQUEZ. Will the gentlelady please allow the witness to answer the questions? Ms. VAN DUYNE. If she answers the questions I would really appreciate it. Ms. GUZMAN. Look, I mean, the bottom line is that, you know, there are important provisions, President Biden has pledged to not only--to not increase taxes on taxpayers earning less than $400,000. And, you know, including S corporation taxpayers. All of the exceptions as I said---- Ms. VAN DUYNE. I would really appreciate it if you would answer the question. What would be the impact, and I know it is not the focus, but there will be direct and indirect impacts on increasing our corporate tax rate, correct, on small businesses? Ms. GUZMAN. Not on the smallest businesses. And so, again, we are---- Ms. VAN DUYNE. On small businesses defined by your administration and by your department. I mean, things like increases in utility taxes and utility costs, those will be felt by small businesses; correct? Ms. GUZMAN. Small business, yes. Small businesses will, you know, will continue to have to navigate the systems in place and any increases that vendors might transfer to them. But, you know, again, the focus on this tax reform is really to ensure that those smallest--there is a level playing field for the smaller entities. I appreciate that SBA supports all small businesses. You know, it could be as large as 500 employees. Ms. VAN DUYNE. I reclaim my time. I have 20 seconds left. It is obvious that small businesses that you are speaking with are not telling you what the rest of us across the country are hearing. I would welcome you, I would invite you to come down to Texas 24 in Dallas-Fort Worth and speak with the small businesses that we are talking to that will tell you what the problems are directly so that you can be more prepared and maybe then, when you are more prepared, we have heard directly from small businesses, you can circle back with this Committee and let us know what you are doing to be able to really prepare and protect our small businesses across the country as these Biden administration policies are coming down. I yield back my time. Thank you very much. Chairwoman VELAZQUEZ. The gentlelady yields back. Now we recognize the gentleman from New Jersey, Mr. Kim. Let me just react to this line of questioning. First of all, the topic of this hearing is an examination of SBA COVID relief programs and the administrator is prepared to answer the questions related to the implementation of those programs. There will be a time for us to hold a hearing on any tax policies but this is not the space. I think the taxpayers deserve answers from the administrator as it relates to those programs that have been implemented by the current administration. Now Mr. Kim---- Mr. LUETKEMEYER. Madam Chair, I am claiming some time in response to your comments there. Those tax questions are fair questions because we are talking about the COVID activities and policies of this administration of the SBA. And tax policy on those new programs is very important to have a basic understanding of the tax policies' effect on small businesses will help us understand how these COVID policies, these programs can be helpful. If we find out that there are more detrimental effects from the tax policy, we need to understand how that can affect the COVID policies, the COVID programs. They are very appropriate. It is unfortunate the administrator is unprepared today to answer basic questions about the administration's program. She is not representing the Small Business Administration at the table when the administration is talking about tax policy which is extremely alarming because if she is not there, who is? We need to have answers because all of this factors into how we address the COVID problem in this country. Chairwoman VELAZQUEZ. I just wish that you were so forceful when we were conducting oversight hearings with the previous administration as it related to the fact that ineligible businesses were able to get assistance--relief assistance that they did not qualify for. With that, Mr. Kim---- Mr. LUETKEMEYER. Madam Chair, we were. We were at the table. We contacted Secretary Mnuchin and said, hey, we have got a problem. And immediately, he took action. If you recall, he got in the middle of this and rescinded about $280 million worth of loans to people, to businesses that were ineligible. Yes, we were active on this and will continue to be active, I can assure you. Chairwoman VELAZQUEZ. We will continue to be active on tax policies and we will have Secretary Yellen at the table. We will discuss those issues. To be fair to the witness, the topic today is related to COVID-19 programs. Mr. Kim, now you are recognized for 5 minutes. Mr. KIM. Thank you, Chairwoman. And Administrator Guzman. Thank you for taking some time to be able to come before our Committee. I have been on this Committee since my time in Congress, and we certainly are trying to maintain the tradition of bipartisanship on this Committee. This recognition that both parties are trying to do what they can to be able to support our small businesses, that is the reason why I wanted to stay on this Committee because I felt like it was one of the few places in the last Congress where we were able to talk with each other civilly, with respect, and talk through a shared problem that we face with small businesses going through some of the toughest challenges in modern history. And I know you have a lot on your plate and SBA has been working hard to be able to do this. Some places where it has not performed the way that I would like but other places where I understand that it has been a tough go. And one place that I want to just kind of hone in on is about the Restaurant Revitalization Fund. Now, I know that this has been moving forward, that you have been trying to take on some lessons learned from the launch of the Shuttered Venues Operators Grant Program as well, and I know that the application is something that has been tried to be simplified and easy to use so that restaurants are able to move forward with this. And especially when it comes to making the program accessible for the smallest independent restaurants and the socially disadvantaged business owners. I am also aware that the SBA had to work within the rules set by Congress, including how the funding amounts are calculated so you did not have a lot of discretion to spread around the $28.6 billion that we knew would not even come close to meeting the demand. Still, I am very concerned to hear from businesses in my district, including socially disadvantaged businesses that are supposed to be prioritized, that their applications have been rejected without being provided a reason or an opportunity to correct errors. I worry that many of the most vulnerable businesses that we are trying to help are being left out and that minor errors could mean that a business eligible for a very significant amount of money gets nothing while the next applicant in line gets the full amount. So I just want to ask, can you please explain how SBA is handling applications with minor errors or insufficient documentation? And will rejected applications ever be told the reason, especially in the event that Congress provides more funding for the program and they may have an opportunity to reapply? Ms. GUZMAN. Thank you. I think the challenges with first in, first out programs is just that. And so obviously, businesses were allowed to get back in line and reapply. But that is obviously depending on the level of challenges in their application. I do not have specifics. We would have to review specific cases directly in terms of why individuals were rejected from the program. But I am happy to put you in touch, your team in touch with my team to make sure that we can work through those specific issues. But SBA will be developing processes for businesses, assuming that there are additional funds put in place for businesses to reapply in the future. Mr. KIM. I appreciate your willingness to help out but what I just want to emphasize again, if you can kind of take it back to your team is about just that feedback. When the businesses do not know what it is that has gone wrong, why it is that they are not being accepted, you know, we hear that kind of breakdown there in the communication, we hear that also with the PPP, for instance. I know you addressed this to a point but I have also heard from these panicked business owners waiting for PPP loans when they receive a notice that SBA will remove all loans not approved and further research status from their original platform by 5:00 p.m. on May 17. You know, that is something that they receive that notice, they get very panicked about it, and we are told before that no applications were purged. I get it. But when we are looking at this, you know, Congress has approved more than $800 billion for the PPP program which has funded more than 11.6 million loans, the program has become a crucial lifeline for small businesses but what we are trying to figure out is how is SBA addressing the confusing caused by that notice? And how are we working to resolve these remaining hold codes, complete all pending applications, and utilize the remaining amount before June 30? So this is just something that I am continuing to hear is a problem. Ms. GUZMAN. Yeah. And we definitely noticed the banks so that they could take action as all of those hold codes were a minimum over 30 days. In some cases, over 90 days. And so they needed to take action on those loans. Again, we did not remove them from the system in any way and so they can continue to work through those issues with the SBA if those were actual pending loans that they intended to take action on. So, I definitely appreciate that we need to have more communication. That is a goal as we continue to look for improvements in the program. And so I will take it back with my team and see how we can improve that transparency as we move forward without---- Mr. KIM. Just letting them know what they need to do to resolve it. That is what it comes down to. I yield back. Chairwoman VELAZQUEZ. Time has expired. Now we recognize the gentleman from Florida, Mr. Donalds. Mr. DONALDS. Thank you, Chairwoman, Ranking Member, for this actually quite lively Committee. You know, first of all, Administrator Guzman, I will tell you, you know, I have been coached on kids. I always tell them the number one ability is availability, so I want to thank you for making yourself available. It is unfortunate that Secretary Yellen does not know that the best ability is availability and so she needs to be here to answer these questions. I will tell you, Administrator, I mean, I get it why you cannot frankly keep the 100 with the American people about President Biden's tax policies and other economic policies because you would be in trouble with your boss. So I understand why you cannot be 100 about those things. But what most people do not know is that my career was actually as a bank underwriter, as a credit loan underwriter for many years, so I underwrote small business loans. And I will tell you, 100 percent that increases in the corporate tax rate, increases in the capital gains rate are going to affect small businesses whether you are a C corp or a pass-through S corp, simply because that is what happens with increased taxes. Either it is going to hurt them directly on their bottom line. It is going to hurt the people that they do business with. It is going to impact them as well. So just for the record, as somebody who has actually been a lender that has dealt with SBA from the front lines, I will tell you point blank, increased tax policy is going to hurt small businesses across the United States. That being said, I know that in the last spending bill that was passed in Congress, there was a change to PPP which expanded the ability for nonprofits, specifically large nonprofits to access PPP loans. One of the concerns by myself and other Members of the Committee was that nonprofits like Planned Parenthood and their affiliates will be able to gain access to the PPP program. As to this point, has any nonprofit like Planned Parenthood or their affiliates received PPP loans? Ms. GUZMAN. It is SBA's longstanding policy not to comment on specific borrowers. But yes, there have been over 80,000 nonprofits who have accessed the system. Mr. DONALDS. Is there ability for this Committee to get an understanding of what nonprofits have gained access? Can you provide that to us? Ms. GUZMAN. We have provided specific reports of all the loans, and so that information is readily available to you if you were to search through the system. Yes. Mr. DONALDS. All right. We will make sure we definitely look into that. Real quick, I want to piggyback on something that the Ranking Member was talking about in the EIDL program. You said that it is really not something that frontline lenders want to do is get involved in the EIDL program. It is not really in their incentive base to do so. Have you guys actually itemized or estimated the amount of total fraud in the EIDL program to this point? Ms. GUZMAN. There have been estimates from the IG and we are still working through. I mean, as an example---- Mr. DONALDS. I mean, but real quick because I have got 2 minutes. So what is that number? What is that number? Can you tell us? Ms. GUZMAN. As an example, on identify theft it is less than 1 percent of actual cases. But we continue to work through all those flagged issues with the IG and---- Mr. DONALDS. I mean, but how much money are we talking about? Give me dollars. Dollars and cents. I like percentages, too, but dollars and cents, how much are we talking about? Ms. GUZMAN. We do not have final numbers in terms of the total fraud picture yet as we continue to investigate. Mr. DONALDS. Let me ask you this question. Do you think it would probably be cheaper for the United States taxpayers to incentivize lending institutions who administer EIDL as opposed to paying out money in fraudulent means? Ms. GUZMAN. We would have to work through that together so I welcome---- Mr. DONALDS. Quick question. I mean, you are the administrator now. Do you not think that is a worthwhile calculation to perform? Ms. GUZMAN. Yes. Once we get the final calculation of what the actual fraud is on the program, especially knowing that we have implemented new controls going forward that were not allowed in previous years then, of course, we can look at that trend. Mr. DONALDS. All right. Real quick. The last thing I really want to ask you about is it has also been a point in this Committee that under Administrator McMahon the response time from SBA was actually very, very prompt even though they have new information. You are the administrator now, so quick, what changed? Why have we gone from quick response times to very slow or nonexistent response times? Ms. GUZMAN. I do not know what Administrator Carranza's response times were during the disaster but obviously, the team is highly impacted in terms of their ability to respond as quickly as possible. We have---- Mr. DONALDS. But Administrator, the pandemic was last year, too, and the pandemic is ending this year so I am trying to understand what is the difference in response time between last year and this year? Ms. GUZMAN. My understanding is that the comparison between the previous administration and Administrator Carranza who was in position during COVID versus my time here that we have been very transparent. We have tried to respond as quickly as possible and by expediting these briefings, life briefings as well as reports that we have been sharing with you that that has in addition provided you with more information than in the previous times. Mr. DONALDS. I yield back. Chairwoman VELAZQUEZ.--expired. Now we recognize the gentlelady from Minnesota, Ms. Craig. Ms. CRAIG. Thank you so much, Chairwoman Velazquez. Thank you for being here, Administrator Guzman. For the record, I think you are exactly the right person to be testifying as a witness in front of us today about the SBA's COVID relief programs since you are the administrator of the Small Business Administration. So I want to thank you and everyone at the SBA, and I would like to thank those who worked in the previous administration, with the Small Business Administration, because it is all of your hard work over the last year obviously in implementing the various, mostly bipartisan programs that this Committee approved in the last Congress. It was an extraordinary challenge during a public health crisis. And at the end of the day, we are here to make sure that as many of our small businesses as possible can get through this crisis. And of course, we are going to learn as we go in a public health emergency. So shame on anybody here today who would turn this into a partisan exercise. I especially want to commend the administrator on the creation and implementation of the Restaurant Revitalization Fund. In fact, I would like to thank my colleagues from across the aisle for those of you who supported that. I have been a proud advocate of this program since the Restaurants Act was introduced in the last Congress and I was incredibly pleased to see this get across the finish line when it was included in the American Rescue Plan. Just last week, I heard from one of my constituents, the owner of Tawakal Restaurant located in the great city of Burnsville, who told me that they have already received financial assistance from the RRF. I am pleased to see that these vital funds being disbursed to our hardest hit small businesses are going out so quickly to some. However, you know there is another side of this. In terms of the RRF applicants, such as Nick's Diner in Cannon Falls, I am really disappointed to learn that the likelihood of that independent restaurant receiving assistance is incredibly small. As some of my colleagues before me have mentioned, the RRF does not currently have enough money to assist many of its applicants. That is why I am working on leading a group of my colleagues and pushing House leadership to replenish the program to fulfill current demand or as many of those independent restaurants who have taken the brunt of this public health crisis. Literally, our government asked them to shut down during a public health crisis. We need to work together to uphold our ongoing commitment and replenish this fund. Administrator Guzman, you noted in your testimony that the RFF program has received more than 362,000 applications with a total of $75 billion in funding requested. At the current funding level, is there a possibility a large number of those applicants could miss out on receiving any of those grant dollars? Ms. GUZMAN. Yes. There will be significant demand unmet at the close of this program once awards are finalized. Ms. CRAIG. Administrator, is there any estimate or prediction on how many of those applicants are not going to receive any of those grant dollars at this time? Ms. GUZMAN. Not the specific numbers that they work through the specific applications and the dollar amounts for each. Obviously, we had the $9.5 billion in set-asides for the smaller entities but the latest numbers are over $76 billion in applied, and with only $28.6 billion available there will be a significant number of those 372,000 applicants. Ms. CRAIG. Administrator, do you think that Congress should strongly consider replenishing this program? Ms. GUZMAN. The program has been effective at reaching out to support small businesses, restaurants, food and beverage businesses broadly. There is obviously a large pool of applicants who are interested in this grant funding, and these are the hardest hit industries that are big job creators in our economy. And so providing that support to them is really critical. And whatever Congress moves forward with we would be more than willing to implement as expediently as possible. Ms. CRAIG. Thank you so much for that answer. And from that I am going to assume your answer is yes. Are you open to working with this Committee and leadership to explore replenishing the RRF? Ms. GUZMAN. We would be happy to collaborate and provide any information and intel that can better inform that decision. Yes. Ms. CRAIG. Thank you so much. And I yield back. Chairwoman VELAZQUEZ. The gentlelady yields back. Again, Administrator Guzman, thank you so much for joining us today. We appreciate your testimony and your service to our nation's small businesses. I am also grateful for SBA's responsiveness. The increased level of transparency and receptiveness for information has not gone unnoticed. I commend you for being more forthcoming with this Committee. With that said, you have taken over the helm of SBA at one of the most critical times in its history and the road to recovery will be a long and winding one for small businesses. Your testimony has also given us much to think about and we will continue to look at the obstacles that small business relief programs face. It is important to remember that no program is perfect and we must help them operate as effectively as possible. This hearing has made clear that there is much work to be done and I look forward to partnering with you on all of these efforts. I welcome your continued engagement, particularly as we look to reauthorize the SBIR/STTR programs. I would ask unanimous consent that Members have 5 legislative days to submit statements and supporting materials for the record. Without objection, so ordered. If there is no further business to come before the Committee, we are adjourned. Thank you all. [Whereupon, at 12:17 p.m., the Committee was adjourned.] A P P E N D I X [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] [all]