After President Donald Trump’s administration deemed in early April that small gaming businesses would be ineligible for an emergency loan program, the state’s congressional delegation went to work to reverse the decision.
What seemed like an easy, achievable fix to the rules for the Small Business Administration’s $350 billion Paycheck Protection Program turned out to be a test of the effectiveness — and patience — of the state’s six federal lawmakers.
“It may be the most pressure I've ever felt that you have to deliver for your district,” Rep. Mark Amodei, the only Republican in the delegation, said in an interview in which he revealed his connection with new White House Chief of Staff Mark Meadows.
Interviews with Nevada lawmakers and aides paint a picture of a full-court press in which legislators used every form of leverage they had with the Trump administration and committee chairmen. They pulled strings, cajoled White House officials, and in one instance resorted to berating Treasury Secretary Steven Mnuchin in front of other lawmakers when an initial rewrite of the rules did nothing to help the small Nevada businesses that had been left out of the program.
“I was just pissed,” Amodei said. “You guys basically decided that these industries and these employees are not worthy of help in the worst economic crisis of modern times,” he recalls thinking.
The frantic lobbying started around March 27, the day President Trump signed into law the $2.2 trillion economic stimulus package, suggesting the delegation had caught wind of eligibility problems for small businesses with gambling operations even before the rules became official. Democratic Rep. Dina Titus, co-chair of the Congressional Gaming Caucus, to which Nevada House members belong, wrote a letter to SBA Administrator Jovita Carranza calling on the federal government to “step up to help ALL small businesses,” including small gaming establishments.
By April 3, Titus’s fears appeared to be founded. The SBA unveiled its initial rule for the small-business program that deemed ineligible businesses that made more than 33 percent of revenue from gambling. Convenience stores, bars, taverns and others with gaming systems in their facilities tend to generate a substantial portion of revenues from those operations, often exceeding the 33 percent threshold and in effect disqualifying them from participating.
“Gaming small businesses include many of our local bars, restaurants, and convenience stores. They sustain the livelihoods of countless Nevadans,” said a spokesman for Rep. Susie Lee. “Those jobs are vital to our economy, and the Congresswoman could not stand aside and let Washington, D.C. leave our state behind.”
The Nevada delegation went into overdrive. Sens. Jacky Rosen and Catherine Cortez Masto, along with Reps. Steven Horsford, Lee, Titus and Amodei placed urgent calls and wrote letters to various officials.
Among them was Cortez Masto, a member of the Senate Banking and Finance committees, who worked to win support from her Senate colleagues and highlight the importance of small gaming operations, including tribal gaming, in states across the country, not just in Nevada.
“I’m proud of the work I did, along with the entire Nevada delegation, to bring the concerns of Nevada’s small gaming businesses to the attention of the Administration and help secure the reversal of an outdated rule,” she said in a statement provided by her office.
Amodei leaned on his relationship with Meadows, who was one of the first people Amodei called. Meadows resigned his congressional seat in March after serving four terms to take the chief of staff post.
“As the only Republican with, I think, that kind of access to the administration...it's like, ‘Hey, I gotta have this,’” Amodei continued.
Meadows previously helped Amodei get a new zip code for the Tahoe-Reno Industrial Center in 2018. Amodei said he had tried to pass legislation for years and Meadows, who at the time was chairman of a panel that had jurisdiction over the U.S. Postal Service, had USPS quickly establish the new zip code.
The zip code fight came to Amodei’s mind when he got a call from Meadows that the PPP issue would be fixed.
“Listen, this is right up there with getting a zip code, thank you so much,” Amodei said he told Meadows.
“If Mark Meadows needs somebody to mow his lawn, I'm gonna be there with my mower and doing it for free,” Amodei said.
A White House official praised Amodei’s efforts when asked about Amodei’s back and forth with Meadows.
"Congressman Amodei has been a tremendous advocate for Nevada on this issue and is in frequent contact with the White House, working in partnership with President Trump to deliver for Nevadans,” the official said.
At one point, Amodei’s frustration boiled over directly with Mnuchin, who held a series of separate calls with House and Senate Republicans and Democrats as they negotiated the second round of PPP funding.
“I want to know, by name, who the person is in Treasury that I'm fighting on this,” Amodei recalls saying to Mnuchin on a conference call with House Republicans. “Because quite frankly, I can't find anybody that says: This is what we meant.”
According to Amodei, Mnuchin responded by saying he would talk offline after. Amodei gave his phone number and curtly said: “I’ll be waiting by the phone” before hanging up. A Treasury spokesman didn’t respond to a request for comment on the situation.
“Listen, I'm not an asshole, but I've had it,” Amodei said of his mood at the time. “I shouldn't be having to work this hard to have them carry out the goddamn plain meaning of the statute.”
After the call, Amodei said he got atta-boy texts and calls from some fellow House Republicans who had also grown frustrated with the administration over this and other issues.
By the time of that all-House GOP call with Mnuchin, the SBA had released, on April 14, new PPP guidance that said businesses that receive up to half of their revenue and make over $1 million from gaming are eligible for PPP loans. It was an improvement from the original rule, but still not enough to help a large majority of small gaming operations in Nevada. Analysts said that the change would likely help few to no Nevada businesses.
Rosen, who has worked to cultivate relationships across the aisle since being elected in 2018, also stepped in. She used her seat on the Small Business and Entrepreneurship Committee to enlist the help of Chairman Marco Rubio, a Republican from Florida, who then called Mnuchin to lobby for a change. She called Rubio on a Sunday, saying, “We’re not asking for special treatment. We’re just saying equal access, like every other industry,” Nevada aides said. Rubio had written the provision in the stimulus package that created the $350 billion program, so he had special pull.
“Rosen communicated directly with key decision makers, including SBA Administrator Carranza, Small Business Committee Chairman Rubio, Minority Leader Chuck Schumer, and others on an immediate fix to lift the restrictions SBA imposed on small businesses that derive revenue from gaming,” her office said. A spokesman for Rubio confirmed the senators spoke.
In the meantime, Amodei said he was getting even angrier. He had been told the previous week that the Trump administration would be loosening the eligibility rules to allow for those with up to 50 percent revenues from gambling to benefit, but had fired back that the change wasn’t enough. And then word came that the initial $350 billion in PPP funding was close to running out.
“I'm like, ‘This is bullshit,’” Amodei said. “You burned a week and you came out with the same stuff. You said you take our comments to heart.”
Ultimately, last week, Meadows and Mnuchin’s staff assured Amodei that the restrictions holding up money to gambling interests would be addressed, Amodei said. White House officials asked him to hold his fire and he agreed. Mnuchin called Amodei the day before the new change was announced to tell him it was done.
That change was included in an announcement last week from the Trump administration that it would repeal the gambling revenue restrictions when making funds available for the recently-approved second tranche of funding PPP funding.
According to Amodei, Mnuchin said that was a “cleaner” fix rather than changing the rule during the first round of funding.
“This tells you something about what's going on in Treasury,” Amodei noted, adding that he did not agree with that rationale. Amodei said he suspected a possible bias against gaming within the Treasury Department, though he said he believes it is more of an institutional bias and does not blame Mnuchin for the rule or the delay in fixing it.
“I'm not gonna put this at Mnuchin’s feet, because I know he was drinking from a firehose, and he was dealing with the big stuff,” Amodei said.
A Treasury spokesperson didn’t respond when asked for comment.
The Nevada delegation is now rallying around legislation introduced by Titus earlier this month to codify that legal gaming small businesses have access to all the coronavirus relief programs created by the CARES Act and prior legislation. Rosen unveiled the Senate companion measure. Both bills send a signal to the Trump administration for the next coronavirus relief package.
Horsford, who sits on the Ways and Means Committee, which has jurisdiction over the Treasury, is also putting the White House on notice.
“We need a lot of oversight of this administration,” said Horsford, who said that Ways and Means Chairman Richard Neal was on board with ensuring that Nevada gaming interests got money. “That doesn't always require legislation. It requires our committees to be meeting and to do our job.” A spokesman for the Ways and Means Committee confirmed that Horsford raised the issue with Neal.
After learning last Thursday — one day before the formal announcement — that the restrictions would be lifted, Amodei didn’t advertise that information. He said he was reluctant after being burned by the administration before.
“I kept my mouth shut, got on a plane to come back to Nevada Friday morning,” he recalled.
After the announcement, he sent thank-you texts to Mnuchin and Meadows.
“I'm gonna go back to being a low-maintenance, or no-maintenance guy, solving my own problems,” Amodei said.
Disclosure: The Nevada Independent was approved for a PPP loan.
This story was updated on April 30, 2020 at 7:10 a.m. to include confirmation by Democratic Rep. Richard Neal of his talks about small casinos with Rep. Steven Horsford.