Democrats accuse SBA of illegally blocking oversight of lending program

The Small Business Administration is illegally stonewalling Congress' watchdog agency from reviewing its handling of a massive coronavirus relief program, House Democrats alleged Wednesday.

In a letter to SBA administrator Jovita Carranza, five Democratic committee and subcommittee chairs said the Government Accountability Office — Congress' independent oversight arm — has been rebuffed in its attempts to interview top SBA officials and access key documents about the implementation of the small business program, known as the Paycheck Protection Program.

"GAO informed the Committees that SBA has not complied with GAO’s requests and repeatedly failed to commit to a timeframe in which SBA would comply," wrote Oversight Committee Chairwoman Carolyn Maloney (D-N.Y.), Small Business Committee Chairwoman Nydia Velazquez (D-NY.), Coronavirus Select Committee Chairman James Clyburn (D-S.C), Appropriations Committee Chairwoman Nita Lowey (D-N.Y.) and Appropriations subcommittee chair Mike Quiqley (D-Ill.).

"To date, SBA has not granted GAO access to all requested SBA officials for interviews and, according to GAO, SBA officials who have been interviewed have not been fully cooperative in providing timely, fulsome, and transparent responses to interview questions," the Democrats added. SBA also has not provided GAO with loan level data on the Paycheck Protection Program."

Lawmakers are asking SBA to "immediately comply" with the GAO requests for information and interviews, calling it a "violation of the law." SBA did not immediately respond to a request for comment.

The GAO was tasked in the $2 trillion CARES Act with broad oversight over the programs established by the coronavirus relief law, one of several layers of oversight touted by Democrats to hold the administration in check as it implemented the sweeping new programs.

But the office has faced resistance from the Trump administration on sensitive matters before. GAO alleged that the White House and State Department stonewalled their inquiries into President Donald Trump’s handling of military aid to Ukraine, a central issue in the House's impeachment inquiry.

The issue emerged a day after lawmakers sounded a similar alarm after inspectors general warned that the administration was narrowly construing their ability to monitor CARES Act implementation, arguing that their purview only extended to new government-wide appropriations rather than the PPP and other massive new programs meant to stabilize the economy.

It also comes amid growing bipartisan concern about the limitations the administration has placed on oversight of its coronavirus response.

"The GAO, the Inspector General, and government auditors should have access to the identities of the small businesses and nonprofits that received PPP funding and to the amounts and uses of their loans," said Sen. Susan Collins (R-Maine) in a statement to POLITICO last week.

Sen. Ben Cardin (D-Md.), the top Democrat on the Small Business Committee, said last week he was "extremely disappointed" that the GAO was unable to obtain the data.

"How can we know which businesses still need help if we do not know which businesses have received help?" he said.

GAO itself acknowledged having difficulty accessing the information it had requested from SBA.

"GAO has requested information on the establishment and management of the PPP program, along with meetings with program managers. SBA has provided some of that information, and made its staff available, after a delay," the office said in a statement last week. "GAO has also requested data regarding both the PPP loans themselves and EIDL and has received no information about when that data will be provided. GAO has generally received information it requested from Treasury, and been able to meet with Treasury staff."

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