Washington Resident Commissioner Jenniffer González said yesterday that the Small Business Administration (SBA) made $50 billion available for loans to businesses affected by the crisis caused by the new strain of the coronavirus.
However, she explained that for Puerto Rico to have access to these funds the government has to request an emergency declaration to that agency.
"This money is available, but until the governor requests the emergency declaration, the SBA cannot make these loans available on the island," she said.
U.S. President Donald Trump and Treasury Secretary Steve Mnuchin have outlined multiple relief packages, González said and explained that they are also aimed at the private sector, individuals, and the airline industry.
There are $50 billion destined for loans for cargo and passenger airlines. The Treasury Department will determine the interest, terms, and conditions of these loans. On the island, it would apply to local companies, such as those based in Vieques and Culebra.
In the case of individuals, the federal Internal Revenue Service (IRS) and the Bureau of the Fiscal Service were authorized to distribute $250 billion in two rounds of direct payments to taxpayers. The first would begin April 6, and the second round would begin May 18. The total payment will be determined according to income and family composition, Commissioner González explained.
While $300 billion were allocated to the business sector for the creation of an interruption loan program. The initiative would be available to employers with 500 employees or less and loans would be equivalent to six weeks of payroll, with a cap of $1,540 per week per worker. There are other applicable requirements, González said.
"Who can make these loans? All U.S. financial institutions. That's why we need our banking system open," she said, adding that she is in communication with the Treasury Secretary so that the island is included in the proposed reliefs.
The Resident Commissioner asked the governor yesterday for clarity on the exemptions that apply to the banking sector - including cooperatives - during the quarantine period to contain the spread of COVID-19.
Maintaining the industry's operations is essential for the island to begin receiving the aid that the federal government has announced, González said and explained that this is a ripple effect, “if banks cannot provide lines of credit, mitigate, or provide the approved federal aid it means that local banks are going to be prevented from giving this relief to businesses and individuals."
"The president of the United States has just announced that there will be no foreclosures and a moratorium on mortgage payments has been decreed. In Puerto Rico, the main holder of the mortgages is the FHA [Federal Housing Administration], so banks must have operations 100 percent functioning," she said.
González, who said she supports the curfew imposed by the governor, acknowledged that the circular letter issued yesterday by the Department of Economic Development & Commerce fills some of the gaps left by the executive order, but said some of these exceptions must be further adjusted since many of these employees are being investigated by the police.
"We are in a war scenario. The United States has not experienced a situation like this since Sept. 11, 2001 (after the terrorist attack on the Twin Towers) and the American economy suggests this will be ten times worse,” she said.