A new analysis shows that 9 out of 19 top candidates running in Nevada’s federal races were connected to businesses that in total received more than $10.1 million in federal government loans from 2007 to 2021.
The majority of the loans came from the Paycheck Protection Program (PPP), a U.S. Small Business Administration initiative launched to keep businesses running during the COVID-19 pandemic. Most of these loans were forgiven by the federal government.
The analysis found eight candidates — all Republicans — received PPP loans for their businesses, as well as the then-husband of Rep. Susie Lee (D-NV), whose casino company received two government-backed loans.
While these candidates have not directly criticized the PPP loan program on the campaign trail, many have criticized or promised to rein in excessive federal spending — lines of attack that have drawn charges of hypocrisy from national Democrats.
“I was trying to provide students with $10,000 to $20,000 in relief,” President Joe Biden said in a press conference after the U.S. Supreme Court reversed his forgiveness plan last June. “The average amount forgiven in the PPP program was $70,000.”
The Nevada Independent reached out to all of the campaigns mentioned in this story to confirm the findings, better understand how the loans were used and ask whether the loans run contrary to calls to reduce government spending.
Federal guidance on PPP loans stipulated that they could be forgiven if the funds were used for eligible expenses such as payroll costs, business mortgage interest or rent. As of Oct. 2, 2022, more than 10.5 million PPP loans worth more than $793 billion were forgiven across the country, some of which included loan interest.
In Nevada, business entities (including The Nevada Independent) received more than $6.8 billion in PPP loans, of which the federal government forgave about $6.3 billion. The loans have been credited with keeping workers employed and contributing to a “historic economic recovery.” U.S. Department of Treasury economists estimated that the program may have saved as many as 19 million jobs, though some economists have argued that it was not as helpful as other forms of aid.
For this analysis, The Nevada Independent and Sunlight Search searched for all businesses registered to a candidate or lawmaker or their spouse and cross-checked the names of the businesses against the publicly available list of businesses that received a PPP loan. The search included members of Nevada’s federal delegation who are up for election in 2024, as well as the top candidates seeking to run against them in the November general election.
Among candidates in the Nevada U.S. Senate race, former U.S. Ambassador to Iceland Jeff Gunter received more than $500,000 in PPP loans for a California-based dermatology clinic. A spokesperson for Gunter’s campaign did not say how the money was used, and that “President Trump’s brilliant PPP program focused on revitalizing the economy and protecting American workers.”
Garn Mabey, a former assemblyman running for Senate, received a nearly $50,000 PPP loan for his medical practice and an economic injury disaster loan of $6,000. Mabey said in an email that the PPP loan was used to pay employees, who were unable to work for several weeks because the medical practice could not see patients.
Palisade Strategies, a medication delivery company for veterans founded by race front-runner Sam Brown, received a PPP loan worth more than $20,000. A spokesperson for Brown’s campaign said that he repaid the loan in full and that his company “provided essential services to veterans who needed emergency medications that were unavailable through the VA.”
In Congressional District 1, GOP candidate and Las Vegas restaurateur Flemming Larsen received $2.5 million in loans, about 56 percent of which were PPP loans. Larsen’s businesses have also received loans for small businesses that cannot obtain the necessary credit in the private marketplace but have shown an ability to repay the loans, as well as other disaster assistance loans from the pandemic.
In an interview, Larsen called the PPP program “essential” and said it helped him continue to pay his restaurant employees during the height of the pandemic, noting that if he didn’t take the loans and had to lay off his employees, “they would have been paid by the federal government anyway, so you had to pay them through me, or pay through unemployment.”
“I think PPP was essential,” he said. “I think it was great. I think the government had to do it if they were going to close everybody down.”
The other Congressional District 1 candidate who received a loan was Mark Robertson, who received a $25,000 PPP loan for his accounting business. He said in an email that the loan was used for employee salaries and authorized operating expenses.
Wealthy video game composer Marty O’Donnell, who is running in Congressional District 3, received more than $1 million in PPP loans for a company he founded, Highwire Games LLC, a $25,000 disaster assistance loan for O’Donnell/Salvatori Inc. — a company he started with his co-composer of the Halo video game franchise — and $1,000 in an economic injury disaster loan.
A spokesperson for O’Donnell’s campaign said “we took advantage of the PPP loan program set up by the federal government so we wouldn’t have to fire employees and shut down our business permanently.”
“Yes, the federal government spends too much money, but this program created because of a once-in-a-generation pandemic is not the reason,” the spokesperson said. “The problem is the budgets that are bloated every year and the politicians who lack the moral courage to fight against government excess.”
In 2020, Lee (D-NV) faced criticism when the news broke that the casino company run by her then-husband received PPP loans after she and three members of Nevada’s congressional delegation repeatedly pushed for the Small Business Association to open the loans to small gaming businesses.
In a statement to The Nevada Independent, Lee’s campaign said she was not involved in any aspect of the decision-making around the loans and had “no influence over the decision to file for PPP loan forgiveness or whether or not that application was approved.”
Lee didn’t learn about the company’s intent to apply until days after the loan eligibility was expanded, the statement added.
Sunlight Search, a nonpartisan organization focused on helping journalists conduct accountability research on political candidates, contributed research for this report.
Disclosure: The Nevada Independent received a PPP loan of about $207,000 in 2020 for payroll expenses that was forgiven.
