Daily Beast: Nevada Congresswoman Pushed for COVID Loans for Casinos. Her Husband Got Two.
Susie Lee’s husband runs Full House Resorts and Lee’s family owns millions in Full House assets. While millions of Americans were losing their jobs, Susie Lee ensured her husband’s company received over $5 million in PPP loans.
Lee also ensured her husband’s company – which employs more than 500 people – was classified as a small business. Lee had previously criticized legislation that allowed businesses to “carve out” different entities so it would seem like the business employed less than 500 people. But, that’s exactly what she made sure happened for husband.
NRCC Comment: “Millions of Americans are losing their jobs while Susie Lee is misusing her position in Congress to ensure her millionaire family doesn’t lose money during a global pandemic. Disgusting.” — NRCC Spokeswoman Torunn Sinclair
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Nevada Congresswoman Pushed for COVID Loans for Casinos. Her Husband Got Two.
Lachlan Markay
The Daily Beast
June 8, 2020
https://www.thedailybeast.com/nevada-congresswoman-pushed-for-covid-loans-for-casinos-her-husband-got-two?ref=scroll
This past April, a freshman Nevada congresswoman lobbied the federal government to expand coronavirus aid to her state’s gaming industry. Two weeks after the change went into effect, her husband’s casino company received millions of dollars in government-backed loans.
In a letter to the heads of the Treasury Department and Small Business Administration, Democrat Rep. Susie Lee urged the agencies tasked with administering the Paycheck Protection Program to reconsider regulatory language that excluded gaming companies from the program’s small business aid, which extended forgivable loans to help cover payroll and overhead costs amid the pandemic.
“Every day that passes without relief results in further harm to those businesses’ employees and their families,” Lee wrote. “For the SBA to take the position that these small businesses are not eligible for needed aid because of their involvement in the gaming industry belies the economic realities of their location and will doom countless small businesses in Nevada to bankruptcy.”
Within a couple weeks, federal regulators made the precise change she was seeking. In late April, Treasury and SBA updated their PPP eligibility guidelines to include businesses with fewer than 500 employees that derive more than half of their income from gaming.
“On further consideration,” SBA said, “the Administrator, in consultation with the Secretary, believes this approach is more consistent with the policy aim of making PPP loans available to a broad segment of US businesses.”
It was a major win for the casino industry and for the Nevada economy generally, which relies heavily not just on casinos but on other businesses that happen to house games such as slot machines. One Nevada-based gaming company that took advantage of the change to the PPP program was Full House Resorts, a casino developer led by chief executive Daniel Lee, Rep. Lee’s husband.
About two weeks after the SBA made PPP loans available to gaming businesses, Full House secured two such loans totaling about $5.6 million, according to a filing with the Securities and Exchange Commission. The company said that the funds would “be used principally to rehire several hundred employees” and to prepare for the reopening of two of its casinos, neither of which were in Nevada: the Rising Star Casino Resort in Indiana and Bronco Billy’s Casino in Colorado.
A Lee spokesperson told The Daily Beast that she had no role in or knowledge of the PPP loans awarded to her husband’s company. “She is not involved in any aspect of Full House’s business or decision making,” the spokesperson wrote. “She had no influence over the decision to file the application, and she had no influence over whether or not that application was approved or denied. The conditions and details under which Full House Resorts received its PPP loan are entirely between Full House Resorts and regulators.”
Lee’s work to expand PPP eligibility for gaming businesses stood to benefit numerous companies, particularly in Nevada, beyond Full House. And she was not the only member of Congress pressing for that change. A day after her letter to Treasury and SBA, Lee signed onto a letter crafted by the entire Nevada congressional delegation urging House and Senate leadership to explicitly include small gaming businesses in future coronavirus relief legislation.
But Lee’s direct lobbying of federal regulators appears to have paid off more immediately for gaming businesses looking for federal assistance. Indeed, it’s an accomplishment she touts prominently on her website, and her office highlighted those efforts in its statement to The Daily Beast.“Congresswoman Lee has been a strong advocate for Nevada’s working families and her work to ensure that our state’s main industry was not unfairly excluded from this program demonstrates that commitment to ensuring that working families are protected,” her spokesperson said. “Congresswoman Lee will continue to focus on her work in Congress to fight for Nevada’s working families who need a helping hand now more than ever.”
The congresswoman’s push to expand the eligibility of the PPP loan program also underscores how frantic a scramble took place among distressed industries to get government cash in the wake of the pandemic-induced economic slow down—and how clever those industries and their champions were in finding ways to define the term “small business.”
Prior to the pandemic, Full House had approximately 1,600 employees, according to its SEC filing—well over the 500-employee limit that was the determination for what constituted a “small business.” But casinos it owns and operates, including Rising Star and Bronco Billy’s, each have fewer than 500 employees individually and therefore qualify for relief under SBA rules designed to assist franchises or subsidiaries of larger companies.