SBA rolls back many criminal history barriers just before deadline

*UPDATE (7/7/20):  “SBA throws in the towel and Congress extends the PPP deadline” After Congress authorized hundreds of billions of dollars for small business relief during COVID-19, the Small Business Administration (SBA) imposed restrictions on applicants with an arrest or conviction history.  We have written much in recent weeks about how these barriers, neither required nor contemplated by Congress, impede access to the two major stimulus relief programs for small businesses, nonprofits, and independent contractors: the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) program. On June 12, the SBA eased some of the restrictions for PPP, just as two lawsuits were filed in federal court challenging the restrictions.  Today, SBA further relaxed its criminal history barriers for PPP assistance, this time in a far more significant fashion, and in a manner that makes the business owners who are suing the SBA now eligible to apply.  However, the new regulation and application form come less a week before the June 30 deadline to apply for relief. The new policies include two important changes to eligibility.  First, being on parole or probation is no longer disqualifying, unless the parole or probation “commenced” within the last year for any […]

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IRS blocks stimulus tax relief to people in prison; court orders relief

*Update (10/19/20): Per federal court orders, incarcerated individuals may now apply for stimulus payments.  The current deadline to apply is November 4, 2020.  More information is available at this link. In response to the public health and economic challenges of COVID-19, Congress in March 2020 enacted the CARES Act.  We have written at length about the Small Business Administration’s unfortunate and unauthorized disqualification of small business owners from Paycheck Protection and disaster relief because of their criminal record.  It turns out that the SBA is not the only federal agency discriminating against people with a record in carrying out the CARES Act.  The IRS has also gotten into the act, in what may be an even more lawless fashion. The CARES Act authorizes stimulus payments in the form of a tax rebate of $1200 per adult and $500 per child for households with incomes below a certain level.  See P.L. 116-136, sec. 2201.  Specific categories of individuals are excluded from receiving these payments (e.g., any “nonresident alien individual” or an estate or trust), but nothing in the CARES Act excludes people who happen to be in prison or jail or any other detention facility.  Likewise, no federal regulation excludes incarcerated […]

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CCRC in the Post: Protesting should not result in a lifelong record

CCRC’s Margaret Love and David Schlussel published an op-ed in the Washington Post on Monday: “Protesting should not result in a lifelong criminal record.”  The piece begins: Sparked by the killing of George Floyd on May 25, protesters across the country have been demonstrating against police violence and racism. As of June 4, the Associated Press tallied more than 10,000 arrests during and after protests, and the number has surely increased. Most of those arrested will almost certainly be released without charges or have their charges dropped. Others will face charges and may be convicted. Regardless of the outcome, the mere fact of an arrest will leave a person with a criminal record in most states, creating long-term barriers to employment and housing, and in other areas of daily life. Protesters should not wind up with a lifelong criminal record. States should provide for automatic expungement of records that do not result in a conviction, particularly where the government does not even bring charges. States should also expand the availability of relief for convictions. . . . . Our research indicates that automatic or expedited expungement of many non-conviction records is available in 15 states, thanks to recent reforms. Thirty-three additional […]

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SBA eases some criminal history barriers and faces litigation

*UPDATE (7/7/20):  “SBA throws in the towel and Congress extends the PPP deadline” After Congress authorized hundreds of billions of dollars for small business relief during COVID-19, the Small Business Administration (SBA) imposed restrictions on applicants with an arrest or conviction history.  We have written much in recent weeks about how these barriers, neither required nor contemplated by Congress, impede access to the two major relief programs for small businesses, nonprofits, and independent contractors: the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) program. Following the introduction of a bipartisan Senate bill to roll back most of these barriers, Treasury Secretary Steven Mnuchin agreed on June 10 to revise the PPP restrictions.  On Friday, June 12, SBA issued new regulations and application forms to ease some of the barriers in the PPP.  The changes are more limited than the proposed Senate bill, and continue to reflect an SBA overreach in its approach to loan applicants with criminal records, at a time when we are nearing the June 30 closing date to apply for this much-needed assistance. Meanwhile, two lawsuits have been filed against the SBA in federal court in Maryland, asserting that the SBA’s criminal history restrictions are […]

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How to expand expungement: base it in retribution instead of rehabilitation

A thoughtful new article by Brian Murray recommends a new way of conceptualizing expungement that should make it easier for reformers to justify facilitating access to this record relief.  In “Retributive Expungement,” forthcoming in the University of Pennsylvania Law Review, Murray argues that expungement should be seen as a way to end warranted punishment rather than to recognize and incentivize rehabilitation.  The argument goes that if the legal and social disadvantages of a criminal record function as part and parcel of the criminal sentence imposed by the court, as opposed to a loosely related system of civil penalties that are activated by other laws and other actors, then the court has an obligation at some point to discharge it.  While this argument is not new, Murray places it squarely in a modern retributivist framework. In an earlier era, the drafters of the 1962 Model Penal Code embraced this idea of tying up the loose ends of criminal punishments through court-ordered dispensation, although they chose a more transparent form of remedy in judicial vacatur or set-aside.  Before that, this function of ending punishment was performed by executive pardon.  In modern times, as ubiquitous background checking has made a criminal record a lasting […]

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