Hundreds of labor unions — including numerous teachers’ unions — and related organizations received $36.7 million in federal funds through the federal Paycheck Protection Program (PPP) for which they were legally ineligible, according to a new Freedom Foundation report (pdf) released today.
The Paycheck Protection Program was created by Congress as part of the CARES Act, the first federal COVID-19 relief package passed in March 2020. Administered by the Small Business Administration (SBA), the PPP provided forgivable loans to small businesses to help cover payroll costs and keep people employed during the government-mandated lockdowns.
However, from March 2020 until passage of the American Rescue Plan in March 2021, most tax-exempt organizations, like labor unions, except 501(c)(3) nonprofits, weren’t eligible for PPP funds.
Among the apparently ineligible recipients were at least a dozen teachers’ unions and advocacy groups that received $6.8 million in PPP loans. Nearly a dozen other unions representing government employees also received $1.5 million in PPP funds, including several affiliates of the American Federation of State, County and Municipal Employees (AFSCME).
Further, nearly a half-million dollars in PPP funds flowed to state
and local AFL-CIO chapters, which represent unions, not workers, and
tend to devote the lion’s share of their resources to political
activity.
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Freedom Foundation Reports:
- Profiting from a Pandemic - How Ineligible Unions Collected Millions in Federal COVID Relief Funds
- List of ineligible/suspect loan recipients. (xls format)
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