Illinois GOP Ask Pritzker to Clarify
PPP Guidance for Nonprofit Human Service Organizations
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[July 08, 2020]
Representatives Darin LaHood (IL-18), John
Shimkus (IL-15), Adam Kinzinger (IL-16), Rodney Davis (IL-13), and
Mike Bost (IL-12) sent a letter to Illinois Governor JB Pritzker
requesting that the state, Illinois Department of Human Services (IDHS),
and Illinois Department of Children and Family Services (IDCFS)
clarify recent guidance that asserts that the state may reduce
funding for nonprofit human service organizations equivalent to
funding they received through the Paycheck Protection Program (PPP).
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The Members released the following joint
statement:
“Congress did not intend for the funds provided through the Paycheck
Protection Program to supplement state budgets by offsetting the
cost they pay for services through private nonprofit service
providers. The PPP has helped businesses, nonprofits, and workers
across Illinois get through this challenging time. The state’s
assertion that it may deduct an amount equivalent to any funds
nonprofit organizations receive through PPP from what they are paid
in their contracts is a clear overreach. Nonprofit service
organizations should not be punished at the expense of the state
during this difficult time. Governor Pritzker and relevant state
agencies must withdraw their request for information about PPP
dollars in accordance with Congressional intent.”
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You can read the full letter here or below.
June 3, 2020
Governor JB Pritzker
Office of the Governor
207 State House
Springfield, IL 62706
Dear Governor Pritzker,
We write today on behalf of the nonprofit human service
organizations we represent to express concern that state agencies,
including Illinois Department of Human Services (IDHS) and Illinois
Department of Children and Family Services (IDCFS), have asked these
organizations to report to the state the status of a Payment
Protection Program (PPP) loan. The PPP was authorized by Congress in
the CARES Act to allow businesses and nonprofits to keep employees
on payroll and off unemployment, given the impact of coronavirus on
our communities and these entities. Based on our understanding of
new guidance issued by the state, these nonprofits will need to
comply with the state reporting requirement in order to receive
their expected payments from the state and risk a reduction of
dollars awarded in current or future state contracts as a result of
the PPP loan being forgiven in part or in whole. To our knowledge,
currently, no other state is requiring human service providers to
report to the state on the status of their PPP loan or tying these
loan dollars to state funding.
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As you are aware, the State of Illinois has
consistently underfunded these nonprofit service providers. Many
nonprofit organizations must raise significant charitable dollars to
fund the gap between the level of reimbursement provided by
government contracts and the actual cost of care. The COVID-19
pandemic has resulted in the cancellation of fund-raising events and
an overall decrease in the charitable donations needed for the
survival of nonprofit organizations.
The PPP loans, including any portion that is forgiven, is to be of
full benefit to the private organizations that have applied for and
received them. It is Congress’ intent to allow private non-profit
agencies to use any forgivable amount of the PPP to help cover the
gap between the level of reimbursement provided by government
contracts and the actual cost of care. This is being done to allow
these organization to be able to weather the long-term economic
impact of the pandemic and keep their employees working and paid.
Congress did not intend funds from the PPP to be used by states to
supplement their budgets or offset dollars states typically pay for
services through private nonprofit service providers. The state’s
assertion that it may have the ability to deduct an amount
equivalent to any funds nonprofit organizations receive through PPP
from what they are paid in their contracts – is a clear overreach.
We urge you to direct your state departments to withdraw their
request for information about PPP dollars and allow these funds to
be used according to congressional intent as outlined above.
Nonprofit human service providers should not be penalized for their
efforts to maintain their operations during this crisis by a state
agency that already counts on nonprofit organizations to supplement
the cost of care for children for whom the state has legal
responsibility.
Sincerely,
[Congressman Darin LaHood]
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