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Pennsylvania House of Representatives
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House of Representatives
Session of 2021 - 2022 Regular Session


Posted: May 5, 2021 11:35 AM
From: Representative Mike Zabel
To: All House members
Subject: Requiring charter schools that took PPP loans to reimburse the Commonwealth
The Paycheck Protection Program (PPP), first passed early in the pandemic as part of the CARES Act, was intended to provide loans to help small-business owners keep employees on the payroll. Businesses would not have to pay the money back as long as they used most of the loan proceeds to pay their employees.
In Pennsylvania, charter schools applied for and received over $53 million in PPP Loans. At the same time, school districts across the Commonwealth have continued to pay charter schools during the pandemic, keeping them financially whole. These loans were intended to be used by small businesses that have lost revenue due to their inability to operate at total capacity and retain employees on the payroll.
Because charter schools are paid from taxpayer funds on a per-registered-student basis, they did not lose any money and should not be eligible to receive PPP loans. These revenues would essentially allow them to make a profit at taxpayer expense.
My legislation would require charter schools to report all PPP loans and additional federal funding to the Department of Education each year. Once the Education Department receives the report, the charter school payment would be reduced by the amount of revenue received from this and all additional federal funding. Districts would receive this in the form of a credit back for all such funds.
We must ensure that public funds are appropriately spent, and if not, there must be consequences. We cannot continue to allow charter schools to claim they are publicly funded but then allow them to act as businesses. Please join me in supporting this important legislation.

Introduced as HB1666