Sen. Martha McSally (R-Arizona) joined the Senate Committee on Indian Affairs at start of the 116th Congress in January 2019. Photo: SCIA

FOR IMMEDIATE RELEASE

April 9, 2020

McSally Leads Letter Urging SBA to Include Small Tribal Gaming Enterprises in Payment Protection Program

In a letter, senators call on the Administration to issue updated guidance that reflects the congressional intent of the CARES Act.

U.S. SENATE – U.S. Senators Martha McSally (R-AZ), Steve Daines (R-MT), and Kevin Cramer (R-ND) are requesting that the Small Business Administration (SBA) issue updated guidance to allow small tribal gaming enterprises under 500 employees to apply for assistance through the Paycheck Protection Program (PPP).

In a letter to Treasury Secretary Steven Mnuchin and SBA Administrator Jovita Carranza, thesenators expressed frustration that although the text of the recently-passed CARES Act states that “any…tribal business concern” under 500 employees is eligible to participate in the PPP, the SBA’s latest guidance imposed additional restrictions that prohibited tribal gaming enterprises from accessing this relief.

“Tribal gaming enterprises provide thousands of jobs for both native and non-native employees, often in rural areas of the country,” the senators wrote. “Even small gaming operations under 500 employees are frequently among the largest employers in their communities. The PPP is about keeping employees connected with their employers so that small businesses can quickly ramp back up their economic activity and help lift their communities into recovery after this health crisis is addressed. To ensure the PPP can fulfil this purpose, we respectfully request that the SBA issue updated guidance to clarify that any tribal business, including tribal gaming enterprises, are eligible for the PPP as Congress intended.”

The full text of the letter is available here and below:

Dear Secretary Mnuchin and Administrator Carranza:

Thank you for your extensive work in implementing the recently enacted Coronavirus Aid, Relief, and Economic Security (CARES) Act to swiftly deliver relief to small business across the country. As the Administration continues this important work, I write to bring your attention to an implementation issue that unnecessarily excludes many small tribal gaming businesses from the Paycheck Protection Program (PPP) contrary to the congressional intent of the legislation.

The Paycheck Protection Program created in the CARES Act was intended to be a new, separate and more inclusive program than traditional 7(a) loans or Economic Industry Disaster Loans (EIDL) administered by the Small Business Administration (SBA). In practical terms, Congress created the PPP to ensure tangible financial relief could be delivered to the broadest section of small businesses as possible. To this end, the legislation specifically includes “any… tribal business concerns” under 500 employees as eligible entities for the PPP.

However, the interim final rule issued by SBA on April 2, 2020 contradicts the legislative as well congressional intent by instituting restrictions on the type of tribal business concerns that are eligible for the PPP by invoking regulations intended for the existing EIDL program (13 CFR

• 120.110). This regulation, which prohibits participation by enterprises who receive more than one-third of their income from legal gambling activities, may be appropriate for other SBA programs but is inconsistent and contrary the purpose of the new and separate Paycheck Protection Program.

Tribal gaming enterprises provide thousands of jobs for both native and non-native employees, often in rural areas of the country. Even small gaming operations under 500 employees are frequently among the largest employers in their communities. The PPP is about keeping employees connected with their employers so that small businesses can quickly ramp back up their economic activity and help lift their communities into recovery after this health crisis is addressed. To ensure the PPP can fulfil this purpose, we respectfully request that the SBA issue updated guidance to clarify that any tribal business, including tribal gaming enterprises, are eligible for the PPP as Congress intended.

Thank you for your consideration of this critical issue for Indian Country. We appreciate the speed with which Treasury and the Small Business Administration have begun executing the provisions of the CARES Act. We look forward to continuing our work with the Administration to provide relief to Americans in this challenging time.

• On March 26, McSally secured billions in financial relief for tribes amid the coronavirus pandemic.