WASHINGTON (AP) – At least a dozen lawmakers have ties to organisations that received federal coronavirus aid, according to newly released government data, highlighting how Washington insiders were both author and beneficiary of one of the biggest government programmes in United States (US) history.
Under pressure from Congress and outside groups, the Trump administration this week disclosed the names of some loan recipients in the USD659 billion Paycheck Protection Program (PPP), launched in April to help smaller businesses keep Americans employed during the pandemic. Connections to lawmakers, and the organisations that work to influence them, were quickly apparent.
Among businesses that received money was a California hotel partially owned by the husband of House Speaker Nancy Pelosi, as well as a shipping business started by Transportation Secretary Elaine Chao’s family. Chao is married to Senate Majority Leader Mitch McConnell.
Car dealerships owned by at least three Republican House members — Roger Williams of Texas, Vern Buchanan of Florida and Mike Kelly of Pennsylvania — received money. So, too, did fast-food franchises owned by Kevin Hern, R-Okla, a law firm owned by the husband of Senator Jeanne Shaheen, D-NH, and the former law firm of Matt Cartwright, D-Pa, which employs his wife.
Money also flowed to a farming and equipment business owned by the family of Vicky Hartzler, R-Mo.
Members of Congress and their families are not barred from receiving loans under the PPP, and there is no evidence they received special treatment. Loans were granted to Democrats and Republicans alike, something President Donald Trump’s campaign was quick to highlight when records showed donors to his campaign coffers were among the earliest beneficiaries.
Hundreds of millions of dollars also flowed to political consultants, opposition research shops, law firms, advocacy organisations and trade associations whose work is based around influencing government and politics.
While voting, lobbying and ultimately benefitting from legislation aren’t illegal, advocates said the blurred lines risk eroding public trust in the federal pandemic response as Congress begins debating yet another round of coronavirus relief.
“It certainly looks bad and smells bad,” said Aaron Scherb, a spokesperson for Common Cause, a watchdog group whose education arm was also approved for a loan through the programme. Members of Congress should not be allowed to vote on bills in which they can personally benefit, he said.
As of June 30, the Treasury Department programme had handed out USD521 billion to industries including manufacturing, construction, restaurants and hotels.
Treasury identified just a fraction of the total borrowers on Monday, naming only companies that got more than USD150,000. Those firms made up less than 15 per cent of the nearly five million small companies and organisations that received assistance. Many of the lawmakers connected to loan awards emphasised they weren’t part of the application process.
A spokesperson for Pelosi said her husband, Paul, is a minority investor in the company that owns the El Dorado Hotel in Sonoma, California. Paul Pelosi has an 8.1 per cent stake in the company, valued at USD250,000 to USD500,000, Pelosi’s office said.
“Mr Pelosi is a minor, passive investor in this company,” said the Democratic Speaker’s spokesperson, Drew Hammill. “He was not involved in or even aware of this PPP loan.” The firm, EDI Associates, is listed as a recipient of a loan between USD350,000 and USD1 million.
New York-based Foremost Maritime Co, founded by Chao’s parents and run by her sister, was cleared for a loan valued between USD350,000 and USD1 million. McConnell, a Republican seeking reelection in Kentucky, said on Tuesday, “Neither my wife, nor I, have anything to do with that business and didn’t know anything about it.”
The Shaheen & Gordon law firm in Dover, New Hampshire, got a loan of USD1 million to USD2 million. The firm is owned by Jeanne Shaheen’s husband, William Shaheen. A title company partially owned by William Shaheen got a USD160,000 loan and a half dozen companies he partially owns or another relative owns got loans, below USD150,000.
Jeanne Shaheen said she “was not involved in any way in applying for those loans nor do I have anything to do with their businesses, and Congress had no role in processing PPP applications.’’
Four car dealerships owned by Kelly received USD600,000 to USD1.4 million. Mike Kelly Automotive Group, Mike Kelly Automotive LP and Mike Kelly Hyundai and Kelly Chevrolet-Cadillac, all near Pittsburgh, received the money. A spokesman for Kelly said he wasn’t part of the loan application and isn’t involved in the operations of the dealerships, in accordance with ethics rules.
Williams, who had a net worth of over USD27 million in 2018, received a loan for his Roger Williams Chrysler Dodge Jeep dealership in Weatherford, Texas. Williams is president and CEO of JRW Corp of Fort Worth, which is listed as receiving a loan of USD1 million to USD2 million. “Like every other company who accepted a small business loan, our business qualified under law and regulation, and today over 100 of our employees are grateful that we did,’’ Williams said in a statement.
Buchanan, whose net worth is estimated at USD74 million, received three loans for car dealerships totalling USD2.7 million to USD7 million. He told the Tampa Bay Times that he hoped any eligible small business “would use the programme to make sure their workers continued to get paid during this difficult period”.
At least five car dealerships owned by the husband of Rep Carol Miller, R-W Va, also received loans, each ranging from USD350,000 to USD1 million, the data show.
Other lawmakers, while distancing themselves from the loan process, sought to portray the PPP programme as a success story.
Hern’s Tulsa-based KTAK Corp, a management company for several McDonald’s restaurants, received USD1 million to USD2 million. Hern isn’t involved in the day-to-day operations, but “he is happy to share that the family business was able to keep all employees either at their current level of employment or move part-time employees to full time,” Hern’s Chief of Staff Cameron Foster said. Four businesses owned by fellow Rep Markwayne Mullin, R-Okla, received at least USD800,000.