Top House Democrat blasts Yellen for refusing to testify on PPP

House Small Business Chair Nydia Velázquez on Wednesday slammed Treasury Secretary Janet Yellen for declining to appear at a committee hearing, saying the Biden administration's top economic official was showing "complete disregard" for the law.

Velázquez, a senior New York lawmaker, called out Yellen at the beginning of a hearing focused on Covid-19 relief programs for small businesses. Velázquez's panel wanted Yellen to appear because Treasury played a major role implementing the nearly $1 trillion Paycheck Protection Program in partnership with the Small Business Administration, whose chief, Isabel Guzman, was the only official to testify Wednesday.

The clash marked a rare public dispute between congressional Democrats and the Biden administration over transparency in the executive branch's operations. Yellen's absence was notable since former Treasury Secretary Steven Mnuchin made a series of appearances before Congress last year to talk about small business aid.

"Without her at the table, this committee cannot properly fulfill our oversight responsibilities to American taxpayers, nor the nation's entrepreneurial community," Velázquez said. "While she and her team may believe their role in PPP and other small business Covid relief programs is dwindling as we move toward economic growth and economic rebirth, they are sorely mistaken."

The conflict emerged as the Biden administration has faced mounting complaints from Congress about how it has handled the delivery of pandemic-related small business aid, including grants for restaurants and live performance venues, and about how it has responded to lawmakers' concerns.

SBA Administrator Guzman felt the brunt of lawmakers' grievances at the hearing, including GOP complaints about proposed tax hikes that would otherwise be in Yellen's portfolio.

Treasury spokesperson Lily Adams said Yellen “looks forward to continuing robust congressional engagement and will testify before Congress several times within the next month, including tomorrow.” Treasury said it “will continue to work with Congress to coordinate the scheduling of as many hearings as possible.”

Velázquez said Yellen had a legal requirement to appear and that she was disregarding the law. Congress established the requirement in December as part of Covid relief legislation, ordering the Treasury secretary and the SBA administrator to testify within 120 days of the enactment of the law.

A Treasury official said the department consulted with legal counsel and offered to have Treasury Deputy Secretary Adewale "Wally" Adeyemo appear at the hearing. The official said the committee initially accepted the offer and then declined. The House Small Business Committee disputed that it accepted the alternative. Committee spokesperson Evelyn Quartz said the panel didn't accept the offer because it was not what the law required.

Velázquez said she would work with the committee's top Republican, Rep. Blaine Luetkemeyer (R-Mo.), as well as the leaders of the Senate Small Business Committee to find a date for Yellen to appear. Guzman was also scheduled to testify solo at a Senate Small Business hearing Wednesday afternoon.

"This is very troubling," Luetkemeyer said. "It's a complete violation of the law."