Eight members of Congress are calling on the Small Business Administration to investigate whether the operator of a luxury Santa Monica hotel and dozens of other properties properly spent tens of millions of dollars in pandemic relief funding.
Rep. Katie Porter (D-Irvine) and seven of her Democratic colleagues issued a letter Tuesday urging the SBA to investigate how a hotel conglomerate that owns or operates at least 50 hotels spent the money it received — as much as $63 million — from the Paycheck Protection Program.
The group of lawmakers said in the letter that the PPP was designed to keep workers employed but that the hotel company, Columbia Sussex, accepted the funding through multiple affiliates and still laid off thousands of workers.
“Columbia Sussex appears to have taken advantage of these policies — borrowing taxpayer money at artificially low interest rates through multiple entities while laying off workers,” their letter to SBA Administrator Jovita Carranza says.
Phone calls and emails to the Kentucky headquarters of Columbia Sussex were not returned Tuesday.
The PPP, part of the $2-trillion stimulus funding package approved by Congress in March, was promoted as a tool for keeping workers employed during the economic crisis. But experts, academics and union leaders told the Los Angeles Times that loopholes and flaws in the program allowed businesses to accept millions of dollars in forgivable loans without retaining or recalling most of their workers.
The program requires loan recipients to use at least 60%