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AGA: PPP changes still “woefully short” of addressing issues


The American Gaming Association (AGA) described revised guidelines allowing more businesses to participate in the Paycheck Protection Program (PPP) as still falling “woefully short” of helping small gaming businesses survive the coronavirus (Covid-19) pandemic.

The PPP, part of the Coronavirus Aid, Relief and Economic Security (CARES) Act, aims to make $349bn in loans available to small businesses impacted by Covid-19.

However, the wording of the regulations governing PPP by the Small Business Administration (SBA) initially stated that businesses “deriving more than one-third of gross annual revenue from legal gambling activities” were ineligible for the scheme.

It has now been updated, to state that a business does not automatically lose the right to apply for a PPP loan if it receives legal gaming revenue, provided two conditions are satisfied. 

Businesses may now claim for PPP if their gaming revenue was less than $1m in 2019, and comprised less than 50% of total revenue for that year.

The SBA said it believed this test “appropriately balances the longstanding policy reasons for limiting lending to businesses primarily and substantially engaged in gaming activity” with the policy aim of making the loans as widely available as possible.

However the AGA said the revised guidelines represent some process, they fell “woefully short of fully addressing antiquated, discriminatory policies that have, to date, restricted small gaming companies from accessing critical loan support made available through the CARES Act”.

“As a result of this half-measure, small gaming businesses that have closed to comply with government orders will continue to be denied access to this critical lifeline to support their employees,” AGA president and chief executive Bill Miller explained. 

Miller said the association’s efforts to protect the industry during the pandemic were being supported by a bipartisan, bicameral group of congresspeople, who had “advocated tirelessly for equal treatment of small commercial and tribal gaming operations in their communities”. 

“As Congress seeks to put additional resources behind the PPP, we look forward to working with them to make it clear that ‘we are all in this together’ by rejecting the SBA’s dangerous view that gaming employees don’t deserve assistance during this unprecedented crisis,” he added.

The AGA has been fighting the restrictions on eligibility for PPP for some weeks, first warning that the blanket prohibition on gaming business applications could put as many as 350,000 small business jobs at risk. The gaming sector, it noted, delivers $52bn in small business revenue for sectors such as construction, manufacturing, retail and wholesalers.

The association then contacted US President Donald Trump directly over the issue to urge changes. This was supported by letters from lawmakers in both chambers of the US legislature, concerned about the impact of the exemption on their communities.

Covid-19 has resulted in all 989 commercial and tribal casinos in the US shutting their doors, effectively putting 1.8m jobs at risk. More than half of this number, the AGA noted, are at non-gaming businesses such as restaurants and local shops.

“The AGA will continue to strongly advocate for relief that supports the displaced gaming workforce and gaming companies of all sizes through this crisis,” Miller said.