Small business owners struggling to pay their bills and salaries during the coronavirus pandemic have some new hope now that the U.S. House and Senate both approved a relief bill that includes $310 billion to fund the Small Business Administration’s “Paycheck Protection Program,” which provides forgivable loans to businesses.
Congress initially funded the program with $349 billion but that money ran out last week.
The PPP, which launched April 3, is intended to help businesses with fewer than 500 employees, but it has not been easy for small business owners to access the financial assistance or even submit their applications.
“To even navigate through all the websites and application process is really just a nightmare,” said Sandy Cohan, who runs the hockey training facility First Line Training Center in Rockville, Maryland.
Cohan doesn’t know yet if he will receive money through the PPP.
“It’s just a waiting game,” he said. “They say sit and wait and that’s been happening for almost a month.”
Cohan tried filing a claim with his insurance company because he has “business interruption coverage,” but that too was unsuccessful and his claim was rejected.
“This is a business interruption issue,” said Cohan. “I don’t know what else you could call this.”
Making matters worse for business owners such as Cohan was the recent news that large businesses received PPP loans. An Associated Press investigation documented how dozens of publicly listed companies collectively received hundreds of millions of dollars of loans from the program.
According to the AP data, at least 147 publicly traded companies disclosed receiving $555 million. Some had market values well over $100 million, and many had executives that were paid millions each year.
“That was the most frustrating part,” said Ronnie Hier, who runs Ronnie Elias Salon in Oakton, Virginia.
Hier is waiting for word on whether he will receive money through the PPP.
“I don’t know if we’re going to be getting any funds or not,” Hier said. “If we’re turned down for this I don’t know what we’re going to do.”
The Small Business Administration issued an advisory Thursday clearly aimed at big companies like restaurant chains Ruths’ Chris Steak House and Potbelly that received PPP loans.
The guidelines imply that unless a company can prove it was truly eligible for a loan, the money should be returned by May 7.
After a swift public backlash, several companies announced they’re returning their loans, including the New York-based burger chain Shake Shack, which got a $10 million loan and Kura Sushi, which is based in Irvine, California, and got nearly $6 million. A third company, Boston-area biotechnology company Wave Life Sciences USA Inc., told the AP that it started the process to repay the $7.2 million loan it received.
Florida-based Ruth’s Chris also announced it is returning its $20 million in loans.
The Associated Press contributed to this report.
