Breaking down federal PPP loans in Conn. by race

The vast majority of Connecticut businesses that received federal PPP loans are white-owned — at least among those businesses that reported the ethnicity of their ownership.

Only about 10 percent of the businesses in Connecticut who received federal loans under the paycheck protection program — 6,030 out of 60,948 — answered the voluntary question of minority ownership.

Of those that did identify the ethnicity of their ownership, 83 percent are white-owned, based on a Hearst Connecticut Media Group review of PPP loan data.

“The PPP lifted up some communities and left others to drown,” said New Haven state Sen. Gary Winfield. “What you see is the further concretization of social inequity itself.”

That disparity is even more pronounced among larger loans. There have been 8,595 loans between $150,000 and $10 million made to Connecticut companies under the Paycheck Protection Program, of which 1,025 answered the question of the ethnicity of their ownership.

More than 89 percent of those were made to white-owned companies; 2.14 percent were Blackowned; and 3.8 percent of those companies’ owners identified as Hispanic.

The much larger pool of loans were under $150,000, a total of 52,353 individual federal loans made to Connecticut companies.

A little less than 10 percent of the companies that were granted smaller loans reported the ethnicity of ownership and, of those, 4,132 or 82.5 percent are whiteowned.

“This whole thing was a problem from the beginning,” said Winfield. “The fact that people were stunned that the money wasn’t going out to minority businesses was crazy.”

It should be noted that 12.2 percent of all the companies registered in Connecticut are minority-owned, based on census data from 2017, though that data does exclude some industries. It also only counts the number of firms in the state, not the number of worksites.

Joe Ercolano of the Connecticut Small Business Development Center said “it appears” that the number of minority-owned businesses that received state and federal pandemic assistance is comparable to the number of minority-owned businesses in the state.

Using 2012 Census data, his agency estimates about 14 percent of the total number of businesses in Connecticut are owned by Black people, though that data excludes self-employed businesses owners, including contractors.

Ercolano also said the amount of money they received may not be equitable.

“It appears that minority firms were applying for and getting less money,” he said.

According to Winfield, the number of minority-owned companies is not the only operative question.

“The question is, are there enough minority-owned businesses and can they be viable in the state of Connecticut?” he said.

“If that’s the question, then the answer is no.”

The Paycheck Protection Program opened up nearly $700 billion for businesses affected by the coronavirus pandemic, under the 2020 Coronavirus Aid, Relief and Economic Security Act.

After an initial $349 billion was made available, a second round of $310 billion was passed by Congress, $60 billion of which was ostensibly to support minorityowned businesses.

But Winfield said the wording of the legislation left much up to interpretation — it was based on size of the business, not ethnicity of the owners.

“If you read the legislation there was not a word in the legislation about minority businesses getting this money specifically,” he said.