Scattered among the industrial brick buildings in St. Joseph, Missouri — once the starting point for the pony express — lies the story of government pandemic spending gone awry. Among nearly a half-dozen crumbling structures, some with signs posted that warn of conditions that “may present an imminent and substantial endangerment to human health or the environment” are lingering reminders about HPI Products Inc. That’s the local pesticide company that still has not cleaned up a mess it made over a decade ago.
St. Joseph endured 25 years of HPI workers discharging industrial wastewater into the city’s sewer system. In 2007, the U.S. Environmental Protection Agency ordered HPI to stop illegally storing hazardous waste in corroded drums and leaking in its warehouse. In 2009, the Department of Justice secured a guilty plea from HPI owner William Garvey in federal court for violating the Clean Water Act and hazardous waste storage laws. Garvey was sent to prison. The following year, the EPA obtained a consent decree against the company to pay cleanup costs. After the EPA violations, HPI Products Inc. was debarred — meaning it cannot seek federal contracts or financial assistance from the federal government — on Jan. 1, 2010.
Despite its long history of mismanagement and eventual debarment, HPI was approved this spring for a $441,580 loan through the U.S. Small Business Administration Paycheck Protection Program, part of the federal government’s massive pandemic economic relief package, according to a review by NBC News.
Companies debarred by the federal government are not supposed to receive these low-interest federally backed loans, according to the requirements for the PPP program. But the House Select Subcommittee on the Coronavirus Crisis reported in September that it found more than 600 loans totaling over $96 million went to companies that were excluded from doing business with the government. Then on Jan. 11, the SBA’s inspector general reported the number of loans to debarred firms appears to be more than 950. But neither report named those companies.
NBC News, which obtained the loan data under the Freedom of Information Act after a federal court ruling, was able to identify at least 60 debarred businesses worth $32.4 million that were approved for PPP loans. NBC News was among a dozen news organizations that together sued the SBA for release of the information under FOIA. House staffers were able to find more companies because they were given additional identifying information not provided by the SBA to news organizations.
The SBA’s inspector general’s latest report said it found “serious concerns about improper payments” in the PPP program, including money going to debarred companies. It said enough still has not been done by the SBA to prevent these companies from getting loans and to prevent their loans from being forgiven.
U.S. Rep. James E. Clyburn, D-S.C., chair of the House Select Subcommittee, said…
Go to the news source: PPP funds given to debarred companies
