Fed deluged by letters from needy over its loan program
Writers range from school-meal providers to a tuxedo rental company to the California State University system.
The U.S. Federal Reserve on Wednesday released thousands of letters and emails from individuals, businesses and nonprofit groups this spring urging the central bank to widen access to its Main Street Lending Program to more entities struggling to survive the coronavirus-triggered recession.
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The writers included school-meal providers, the American Hospital Association, a tuxedo rental company, the U.S. Olympic & Paralympic Committee, local YMCAs and the California State University system. Pleas for help also came from energy providers, Dallas hotel magnate Monty Bennett, and advocates for the needs of felons.
The Fed launched it Main Street lending program in mid-June to help small and mid-sized businesses hurt by the recession which need funds to tide them over until the economy recovers.
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Despite the yawning need evidenced in the letters, the program as of last week had not yet made a single loan. So far 300 lenders have signed up to participate, Fed Chair Jerome Powell said this week.
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The correspondence, which the Fed had acknowledged previously, sketch the depth and breadth of the need created by the coronavirus crisis across the United States.
It paints a picture of a central bank, which once closely guarded its secrets, newly open to public feedback and willing to respond by reshaping its policies. Many groups pleaded with the Fed to allow nonprofits access to the program. Others asked for reduced minimum loans and otherwise a lower bar for borrowing.
After receiving the letters the Fed tweaked its program to meet many of those demands, and released a proposal to allow nonprofits to borrow alongside private companies.