Jeff Green Gives Insight on what Defense Contractors think about the Paycheck Protection Program in the CARES Act
Jeff Green offered insight to the Washington Post on defense contractors’ use of loans under the Paycheck Protection Program (PPP) in the CARES Act. PPP loans, which may be forgiven under certain conditions, have provided many businesses needed operating capital during the pandemic, including defense contractors that work directly with the U.S. military. An excerpt of the article may be found below:
The Defense Department is spending $668 million in Defense Production Act funding on the defense industrial base. That funding is being meted out through existing, open contracts that don’t have to be renegotiated and don’t require any equity stake.
With capital markets improving throughout April and May, some companies found other options through private markets.
“When the Cares Act passed, most defense companies looked at the program as an option, but most determined that the conditions associated with the loan program were so restrictive it made obtaining capital through other means a better option,” said Jeff Green, a lobbyist who works with several defense firms that considered applying.
One company that passed on government help is Boeing, the battered aerospace manufacturer and defense contractor whose finances have been wrecked by the global slowdown in commercial air travel. Mnuchin and people involved in the drafting of the Cares Act have said the $17 billion pot of money was initially intended in large part to help shore up Boeing. However, the company was able to raise sufficient funds to stay afloat through the private credit markets, which were aided by the Federal Reserve’s extraordinary measures, although the company has also laid off thousands of workers.
The complete article is available here.