The news is out:[ WASHINGTON—Some government contractors took out loans from the Paycheck Protection Program even as they were paid for government work during the pandemic, a Wall Street Journal analysis shows.
The forgivable loans were a lifeline for thousands of hard-hit businesses whose revenue evaporated this spring. Many contractors also judged themselves eligible even though they were working on active government projects, according to an analysis of recently released data on PPP borrowers and other records.
The issue is on the radar of government auditors and watchdog groups examining roughly 4.9 million companies who tapped the $670 billion program approved by Congress to help small businesses cope with the fallout from the coronavirus pandemic.
“If you had contracts on the books and were being paid and were in a strong financial situation, you shouldn’t have taken the money,” said Steve Ellis, president of Taxpayers for Common Sense, a nonpartisan government-spending watchdog.
The Small Business Administration, which is overseeing the program, has promised to scrutinize PPP loans for any improprieties. Legal experts, however, note that the law only required borrowers to say they faced “economic uncertainty” in seeking loans, with no requirement to document actual losses. Under current rules, PPP loans will be covered by taxpayers as long as companies spend more than 60% of funds on payroll and meet other criteria.
Florida was among the top recipients of PPP funds, with loans going to more than 393,000 firms including government road contractors. When Gov. Ron DeSantis told Floridians to stay at home starting April 1, he said the state would speed up road projects by closing more lanes on empty highways.
Two days later, the PPP opened for applications. At least 68 Florida road contractors with active state projects were approved for loans of greater than $150,000, according to the Journal analysis.]
American business rule: screw the taxpayers before the next guy gets to them.