"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’ve done for our nation’s small businesses.
"And 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 rebirth – they are sorely mistaken. In light of the feedback we’ve 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 Paul to find a mutually agreed upon date for Secretary Yellen to appear with Administrator Guzman in the near future.
"Congress has passed eight small business relief bills, allocating more than 1 trillion dollars 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 non-profits avoid permanent closure.
"And 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. And 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 weren’t getting the same access as their larger counterparts with ties to big banks. That’s 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 6,047 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, and the Shuttered Venue Operating Grant Program, 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 taxpayer dollars.
"For over a year, small businesses have persevered through a once-in-a-lifetime crisis. But 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 this crisis and help facilitate a strong recovery."