Republicans slam the Ohio Democratic Party for getting federal Paycheck Protection Program loan

In The News, Covid19Republicans slam the Ohio Democratic Party for getting federal Paycheck Protection Program loan

Budget & Tax, In The News,  | Quick Take
Jul 12, 2020  | 6 min read | Print Article

This article by Sabrina Eaton and Andrew Tobias first appeared in The Cleveland Plain Dealer on July 11, 2020

A federal Paycheck Protection Program loan that the Ohio Democratic Party accepted is drawing interest from Republicans in the state who argue a partisan political organization shouldn’t receive tax dollars intended to help small businesses.

Democrats said they followed proper procedures in getting the loan and were transparent about it.

The loan came to light last week, when the U.S. Treasury Department and Small Business Administration released data on the 4.9 million loans issued to help businesses keep workers on the payroll during the economic downturn caused by the coronavirus. Tens of thousands of Ohio businesses and organizations were on the list, including Cleveland’s Great Lakes Brewing Company, the Rock and Roll Hall of Fame and Museum, Elyria’ Invacare and Lordstown Motors in Warren.

SBA data showed the Ohio Democratic Party’s government-backed loan for less than $350,000 was approved on April 30 through First Merchant’s Bank. State campaign finance records indicate the party got a $333,867 loan on May 6. On its Twitter account, ODP on May 13 questioned how the loans were disbursed, writing that many small businesses were left behind while the program gave more than $1 billion to more than 300 publicly traded businesses.

Ohio Republican Party Chair Jane Timken said it was hypocritical for her Democratic counterparts to take the loan while the party and its members including U.S. Sen. Sherrod Brown questioned whether the program’s loans were reaching small businesses. She said they should fully repay the loan.

“(Ohio Democratic Party Chairman) David Pepper and Ohio Democrats owe Ohio’s voters an explanation as to why their money should be used for Democrat campaigns instead of helping small businesses,” said a statement from Timken.

Spokespeople for Republican U.S. Sen. Rob Portman and Holmes County GOP Rep. Bob Gibbs, a member of the House Committee on Oversight and Reform also criticized Ohio Democrats for accepting the loan.

“The senator doesn’t believe that taxpayer dollars should be used to pay for political operatives or campaigns,” said a statement from Portman spokesperson, Emily Benavides.

“Every taxpayer-backed dollar they took to run political campaigns was a dollar that didn’t go to a small business that needed it,” agreed Gibbs spokesman Dallas Gerber.

While the Florida Democratic Party returned a PPP loan of at least $780,000 in small-business loans at the request of several prominent Democrats in the state, including U.S. Rep. Donna Shalala, a Cleveland native who served as Health and Human Services secretary during the Clinton administration, that’s not happening in Ohio.

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Ohio Democratic Party communications director Kirstin Alvanitakis said her organization was “guided by attorneys, the private financial institution who provided the loan to us and the Small Business Administration, which approved it with full transparency,” throughout the loan application process

“Ohio Republicans are desperate to distract from their own issues and talk about anything other than the fact that Donald Trump is utterly failing to lead during a public health crisis, amid which we as a party worked hard to retain all our employees and preserve their health care,” said a statement from Alvanitakis.

A statement from Brown said his office wasn’t involved with the loan to the Ohio Democratic Party and that he doesn’t know details about it.

“What we do know, and what the released numbers underscore, is that too many small businesses in Ohio are hurting and not receiving the help they need, especially businesses owned by Black and brown Ohioans,” Brown’s statement said. “My office and I are focused on making sure these Ohio small business owners have the support they need and that program is working as Congress intended it.”

A statement from Griffin Anderson, a spokesman for Toledo Democratic Rep. Marcy Kaptur, said the Small Business Administration approved the loan, which preserved the jobs of Ohio Democratic Party employees during a very uncertain time.

“That is what the PPP program was designed to do,” said Anderson. “The state party should follow the law and guidance from its lender with regard to its SBA approved loan.”

Taxpayer watchdog groups said it’s legal for political organizations like the Ohio Democratic Party to get the loans.

“I don’t see anything that suggests that this was not within the bounds of the law,” said Citizens for Responsibility and Ethics in Washington Policy Director Jennifer Ahearn, whose organization got a PPP loan of less than $1 million to preserve 35 jobs.

Taxpayers for Common Sense President Steve Ellis, whose organization got a $173,800 loan that helped it retain 9 jobs, said nothing in the program would prohibit a loan to political organization, but every group that accepts the money needs to think about how it appears.

“Nobody forced anybody to take this money,” said Ellis. “You had to apply for it. You had to jump through a bunch of hoops. There is nothing that said they couldn’t do it. They should have realized it would blow back on them, and figured out how important it was to them.”

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