Biden issues clear guidance to ensure all U.S. residents have access to PPP loans

President Joseph R. Biden Jr. on Monday announced changes to the Paycheck Protection Program (PPP) that aim to increase lending to small businesses and ensure access to those left out of previous rounds of lending.

Included in these changes are steps to clarify eligibility for “non-citizen small business owners who are lawful U.S. residents”.

President Biden announced the changed in brief remarks at the White House, hours after the White House detailed what they would contain.

The White House said the new changes will: “Ensure access to non-citizen small business owners who are lawful U.S. residents by clarifying that they may use Individual Taxpayer Identification Numbers (ITINs) to apply for relief.”

“The PPP statute is clear that all lawful U.S. residents may access the program, but a lack of guidance from the SBA has created inconsistency in access for ITIN holders like Green Card holders or those here on a visa.”

“The SBA will address this unfair consistency by issuing clear guidance in the coming days that otherwise eligible applicants cannot be denied access to PPP because they use ITINs to pay their taxes.”

A 2012 Small Business Association (SBA) report found that across all businesses, “immigrant entrepreneurs start 17 percent of all new businesses in the United States and represent 13 percent of all business owners. Of total business income in the United States, 12 percent is generated by the immigrant business owners”.

Sifan Liu and Joseph Parilla of the Brookings Institution point out that “disparate access has been hard to measure directly because PPP loan-level data provided by the Treasury Department does not consistently report the race and ethnicity of the loan recipient,” let alone the resident status of small business owners.

Using available data they were able to measure loan access by neighborhood area and found that “for non-employer businesses, the loan delay between majority-Black and majority-white neighborhoods grew to nearly three weeks.” This is significant as small businesses in “all majority-Black and majority-Latino or Hispanic neighborhoods” were also found to be far more likely (90%) to have “cash buffers of less than three weeks, compared to…majority-white neighborhoods (35%)”.

A Pew Research Center report found that 77% of the U.S. immigrant population is in the country legally; 27% were permanent residents and 5% were temporary residents in 2017.

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