Money and politics? PPP loans to family members of NH politicians raises questions

EPPING — The numbers are in for the highest receiving businesses of the federal CARES Act’s $520 billion Paycheck Protection Program, or PPP.

On Monday, the U.S. Treasury Department and the Small Business Administration released data featuring the name of every organization in the country that received loans of amounts of $150,000, up to $10 million, broken into smaller ranges.

In total, 4.9 million loans were issued to American businesses and nonprofits through the PPP. Loans in the amount of $150,000, or more only accounted for 15% of all PPP relief. The average loan was roughly $100,000.

Businesses can apply to have their loan forgiven but must do so within 24 weeks of receipt of PPP funds. The SBA can grant loan forgiveness for all or a portion of a businesses’ loan if it determines the employer is “maintaining or quickly rehiring employees and maintaining salary levels,” its website states.

Businesses received PPP loans by applying through SBA-approved lenders or an FDIC-insured bank, credit union and Farm Credit System institution. On July 4, President Donald Trump signed a law extending the deadline for businesses to apply for PPP relief to Aug. 8.

The program’s intent was to put money into the hands of businesses to keep their workers employed while commerce was shutdown to mitigate the spread of COVID-19. However, across the county scores of businesses did not report retaining any of their workers, leading to questions of the accuracy and efficacy of oversight of the program.

According to reports, tax-exempt religious received billions in PPP loans. Major corporations also received million-dollar loans, such as Fiesta Restaurant Group and hotel chains like Braemar and celebrity brands like Kanye West’s “Yeezy” fashion line, to the tune of at least $770 million in the first round of PPP funding alone, according to reports.

Also of note were loans of upwards of several million dollars to family members of federal and state politicians, including the families of New Hampshire's U.S. Sen. Jeanne Shaheen and Gov. Chris Sununu. Corky Messner, a Republican candidate vying to run against Shaheen, owns a law firm in Colorado that received several million dollars.

Dean Spiliotes, a New Hampshire political commentator and civics scholar at Southern New Hampshire University said just by the sheer size of PPP relief of $520 billion, and the need to rapidly respond to the economic crisis created by the pandemic, “such largesse” in terms of the money given to large companies and the politically connected was “inevitable.”

“When the PPP was announced a lot of political types said this was the place we were likely going to end up – we knew it was going to be a money grab,” Spiliotes said. “All kinds of people, Democrats, Republicans, got a piece of the pie, which can always raise question when someone on either side decries an opponent for insider politics. Then, it’s discovered they got piece of the pie as well. I sensed people were almost resigned to the fact all kinds of people and businesses were going to get money who probably didn’t deserve it.”

On Monday, Shaheen’s re-election campaign disclosed exact amounts of PPP loans received by businesses her family members are involved in as several received loans for amounts under $150,000, which were exempted from disclosure by the U.S. Treasury Department.

Shaheen’s husband William Shaheen’s law firm, Shaheen & Gordan P.A., received a $1.2 million PPP loan, and reported saving 73 employee positions. William, also a part-owner of Atlas-Heritage Title in Dover, received a $160,000 loan and reported saving 16 positions. He also received three additional loans of less than $66,000 for other small businesses he is involved in, the highest totaling $65,000.

Good Measures, a Boston health management company with an office in Pease, that Shaheen’s daughter Stefany Shaheen owns a minority stake in, received $840,000 in PPP loans and reported saving 54 positions. Tidepool, a nonprofit Stefany does consulting work for also received a $635,000 loan, but her mother’s campaign said she does not own a stake in that organization.

Shaheen’s other daughter Molly Shaheen received a $22,000 PPP loan for her business Wheat Holdings, a clothing company.

“Like many people in New Hampshire, members of my family manage or work for small businesses and applied for PPP loans to keep their businesses going and their employees on payroll,” Shaheen said in a statement. “I 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. From the beginning, I have called for transparency and oversight of this program and I am glad that all the information about all the PPP loans has now been made public.”

Sununu’s family owns Waterville Valley Resort, which received a loan between $350,000 and $1 million, and reported saving 68 positions. Sununu’s re-election campaign spokesman Benjamin Vihstadt said the governor is not involved in the management of Waterville Valley and had “no role” in applying for the resort to receive PPP loans.

“Waterville Valley Resort is a four-season resort whose ski and summer season business was shut down due to the COVID-19 pandemic,” Vihstadt said. “Like many of the tourism and hospitality industries in the state, Waterville applied for relief under the rules of the program.”

Messner’s law firm, Messner Reeves, LLP, based in Denver, received $2 million to $5 million in PPP loans. The Republican candidate for U.S. Senate’s campaign said he is not currently involved in the firm’s day-to-day operations but was aware of the decision to apply for PPP loans. The firm reported retaining 211 jobs to the SBA.

"Hundreds of Messner Reeves employees, hard-working men and women from all over our country, rely on their incomes to provide for themselves and their families,” Messner said in a statement. “This pandemic has hit us all hard and we can only hope we all will come out of this stronger.”

According to the U.S. Census Bureau, more than 75% of New Hampshire small businesses received PPP assistance. The SBA data claims nearly 210,000 jobs around the state were saved with PPP funds. However, a Seacoast Sunday review of SBA data determined more than 100 Seacoast businesses received loans but left the “retained employees” section of the application blank or reported not retaining a single person.

During a meeting with the owners of Popovers in Epping on Tuesday, Shaheen said the volume of businesses accepting PPP funds while not retaining any employees is concerning. She said if another round of stimulus is passed, oversight must be tighter on only allowing small businesses that need relief most to qualify.

“The biggest program ever done by the Small Business Administration, before this Paycheck Protection Program, was $30 billion a year,” Shaheen said. “The goal (of PPP) was to keep people employed so that nobody would have to pay the money back because they would continue to keep their workers on and continue to follow the parameters of the program.”

If another stimulus is approved, Spiliotes said transparency for companies seeking money will be just as important as the disclosure of payments to them.

“Part of the post-mortem of the PPP will be assessing the plan to see if it had any discernible impact on keeping companies intact and workers employed, despite the unfortunate examples of largesse,” he said. “If there is to be another round of stimulus, to avoid the previous mistakes it will require public pressure to demand what corporate entities are asking for money and how much they are asking for. That may act as a disincentive for the larger and more politically connected entities to ask for larger sums of money.”