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AGA urges SBA to include gambling in Covid-19 loans scheme


The American Gaming Association (AGA) has reacted with dismay after the Small Business Administration (SBA)’s interim regulatory guidelines appeared to block gambling businesses from benefiting from the US Paycheck Protection Program.

The newly-established Paycheck Protection Program (PPP), one element of the Coronavirus Aid, Relief and Economic Security (CARES) Act that was signed into law on 27 March. It aims to make $349bn in loans available to small businesses impacted by the novel coronavirus (Covid-19) pandemic.

While commercial banks were instructed to make loans available from 3 April, the roll-out of PPP has already suffered some delays, with a number of banks saying they were unable to accept applications from that date.

The AGA has now identified a further issue, noting that the interim regulatory guidelines issued by the SBA state that businesses “deriving more than one-third of gross annual revenue from legal gambling activities” are ineligible for the loans.

AGA president and chief executive Bill Miller said he the association was “deeply concerned” with the wording of the guidelines. 

“In SBA’s efforts to quickly issue guidance on the PPP, they relied on antiquated, discriminatory regulations that ignore today’s economic reality and the congressional intent behind the CARES Act, which states that any business concern shall be eligible to receive an SBA loan if they meet specific qualifications regarding their number of employees,” Miller said.

“Unless amended, these initial guidelines will irreparably harm one-third of the U.S. casino industry and the hundreds of thousands of Americans that rely on gaming businesses for their livelihood.”

He warned that it would “affect hard-working Americans from Pennsylvania to Nevada, Ohio to Colorado, and everywhere in between who need and deserve the same level of support as anyone across the country during these unprecedented times”.

In a letter to the SBA and US Department of Treasury, the AGA said by making gaming businesses eligible for the scheme, it would help casino staff avoid having to claim unemployment benefits.

The legislation included provisions allowing the eligibility criteria to be expanded, the AGA noted.

“The AGA urges SBA Administrator Carranza to immediately correct this oversight and extend this needed relief to all of America’s small businesses and their employees, including those in the communities across 43 states that rely on our industry’s contributions,” Miller added.

The association estimates that around 350,000 small business jobs are provided through casino gambling, with the industry delivering $52bn in small business revenue, for sectors such as construction, manufacturing, retail and wholesalers.

Currently 987 of 989 commercial and tribal casino properties across the US are shuttered as a result of the Covid-19 pandemic. Gaming supports around 1.8m jobs across the US, of which more than half are at non-gaming businesses such as restaurants and local shops. 

Furthermore, the AGA said, gaming taxes and tribal revenue share agreements provide $10.7bn in tax revenue to states, supporting infrastructure and education programmes.