Velazquez Announces Small Business Loan Data for Chinatown
Velázquez Announces Small Business Loan Data for Chinatown
Area Businesses Secured Nearly $125 Million in COVID-19 Aid
Washington, DC –Rep. Nydia M. Velázquez (D-NY), the Chairwoman of the House Small Business Committee, announced today that restaurants, retailers and other local businesses in New York City’s Chinatown have obtained almost $125 million in federal aid thanks to legislation Congress passed in response to the coronavirus pandemic.
“Chinatown felt the economic harm from COVID-19 early and our local entrepreneurs are still struggling,” Velázquez said. “These numbers demonstrate that Chinatown businesses, a critical local economic anchor, benefited significantly from the small business programs Congress created earlier this year. Still, more must be done, and I’ll continue fighting for more assistance.”
An analysis conducted by the Small Business Committee found that 1,062 neighborhood Chinatown businesses benefited from the Paycheck Protection Program (PPP), an initiative Congress established as part of the CARES Act in March. These firms obtained a total of $94,633,409 in forgivable loans via the PPP. Under PPP, banks, credit unions, and nonprofit lending institutions make loans to eligible borrowers, who must use a portion of the loan proceeds on “payroll costs,” including salaries, wages and other benefits to qualify for loan forgiveness. The loans are 100% guaranteed by the U.S. Small Business Administration (SBA). While the PPP stopped taking new applications on August 8, Velázquez is working to extend the initiative.
“Nationally and locally, in Chinatown and throughout New York, businesses in a range of sectors were able to retain more employees and keep operating through the PPP,” Velázquez noted. “While the House has passed legislation to keep PPP functioning, Senate Republicans have refused to act, thus far. I’ll continue pressuring the Senate to negotiate with us so we may improve and extend PPP and get more emergency financing flowing to small firms.”
In addition to PPP, local businesses in Chinatown made use of the SBA’s Economic Injury Disaster Loan (EIDL) program. EIDL has assisted small businesses and homeowners recovering from natural disasters for decades. In response to the COVID-19 pandemic, Congress amended the Small Business Act to ensure small businesses impacted by the pandemic would also have access to EIDLs, which offer long-term, low-interest loans to businesses for working capital expenses. Congress also created a new EIDL Advance program that offered EIDL applicants the opportunity to apply for a grant of up to $10,000. Though EIDL Advance funding has lapsed, Velázquez is working to replenish funding.
The Committee’s analysis found Chinatown firms secured 358 EIDL loans and grants totaling $30,365,700.
“As we help our local businesses weather this unprecedented crisis, we must deploy every tool at our disposal,” Velázquez added. “EIDL has a long track record of helping businesses harmed by earthquakes, hurricanes and wildfires. We need our Senate counterparts to act so EIDL continues providing this financial lifeline to small businesses struggling to survive the economic hardship of this pandemic.”
Even before the first case of COVID-19 was documented in New York City, Chinatown’s merchants and restaurateurs were struggling as some visitors shied away from the neighborhood. In recent weeks, many local restaurants have gradually begun reopening with expanded outdoor seating. Nonetheless, the local economy continues struggling with residents and entrepreneurs worried that many businesses may never recover.
“Chinatown businesses were impacted like all small businesses when New York went ‘on pause’ to control the pandemic, but they faced additional challenges as some people avoided the neighborhood out of misplaced fear,” Velázquez concluded. “I will do everything possible to help these local businesses not only recover, but eventually thrive over the long term. Chinatown is an iconic part of New York City and we cannot allow businesses there to be left behind.”
The Committee’s analysis of Chinatown SBA assistance is online here.