This week, Senator Rand Paul (R-KY), Ranking Member of the Senate Small Business Committee, along with the Committee’s Republican members led a follow-up letter to their April 15 letter to the U.S. Small Business Administration (SBA) regarding the unlawful participation of the Planned Parenthood Federation of America (PPFA) in the Paycheck Protection Program (PPP).
On April 15, 2021, Dr. Paul and SBC Republican members sent a letter detailing how two PPFA affiliates were approved for second draw loans despite their ineligibility for PPP loans.
The letter requested that the U.S. Small Business Administration (SBA) investigate and provide additional information regarding PPFA affiliates participation in the PPP by April 23, 2021.
“We have not received the requested information or a formal response from you.” the Senators wrote. “In fact, since our April 15 letter to you, SBA approved PPP loans for at least two additional PPFA affiliates according to the most recent public data posted to the Agency’s website. This includes a $10 million dollar loan, the maximum loan amount, to a PPFA affiliate just last week. This is unacceptable. As members of the U.S. Senate Committee on Small Business and Entrepreneurship, we expect transparency and cooperation with requests for information from your agency.”
Dr. Paul is joined on the letter by Senators Marco Rubio (R-FL), James Risch (R-ID), Tim Scott (R-SC), Joni Ernst (R-IA), James Inhofe (R-OK), Todd Young (R-IN), John Kennedy (R-LA), Josh Hawley (R-MO), and Roger Marshall (R- KS).
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On May 19, 2020, SBA determined that local affiliates of PPFA were ineligible for PPP loans under the applicable affiliation rules and size standards and that the loans they received should be returned. SBA cited the control PPFA exercised over its local affiliates in a number of different areas, such as medical standards, affiliate patient transfers, and an accreditation review process administered every three years as evidence of an affiliated organizational structure. Given that PPFA has nearly 16,000 employees nationwide, SBA determined that these PPFA affiliates were ineligible for PPP and requested that each of the 38 affiliates return the $80 million in PPP funds they wrongfully received.
During the partisan Budget Reconciliation process earlier this year, Democrats planned to waive SBA’s affiliation rules for nonprofits, which would have allowed PPFA to be eligible for PPP. Ranking Member Paul forced Democrats to remove the provision. The Paul team strenuously argued to the Senate Parliamentarian that this waiver would only benefit Planned Parenthood and thus violated the so-called Byrd rule. Before the Parliamentarian was able to rule on the arguments presented, the Democrats filed an updated version of the bill that did not include the offending provision – a concession that avoided setting a precedent.
You can read the entire letter HERE.
