Bankruptcy

like Spotlight Family Dental in Cumming have hit bankruptcy as they have struggled to meet safety requirements that would allow them to reopen.

Travel and tourism-related businesses are hurting, too, as airlines have drastically cut capacity.Therentalcarprovider Hertz filed for bankruptcy in May, and industry experts say that airlines, cruise ship operators and hotels are vulnerable.

Bankruptcy does not typically mean a company is going out of business permanently, and many continue to operate as they try to renegotiate debts. Retailer Neiman Marcus’ store at Lenox Square is open, even after it filed for bankruptcy in May.

“Bankruptcy has such a terrible taboo, but the whole point is to help people get out from underneath debt in an organized way,” said Amy Quackenboss, executive director of the American Bankruptcy Institute, who formerly practiced bankruptcy law in Atlanta.

A new law that makes it cheaper for small businesses to file for bankruptcy will likely result in more cases this year, attorneys said. Previously, a small business had to file the same bankruptcy case as a large corporation.

“Chapter 11 is very expensive,” Quackenboss said. “There is now a much more efficient way for small business to qualify for Chapter 11.”

Real estate concerns will drive many new cases, Williamson said. In the federal Paycheck Protection Program, relief loans will be forgiven if smallbusinessesusethemoney to pay workers and rent. But those loans are running out.

“Commercial mortgage loans are going to default,” which will impact landlords and banks, Williamson said.

Many small businesses survived for weeks thanks to the $660 billion PPP initiative. About $130 billion of

PPP funds remained available at the end of June, and Treasury Secretary Steven Mnuchin has suggested repurposing that money for businesses that need it. Mnuchin has also proposed forgiving all PPP loans under $150,000 without requiring business owners to submit a forgiveness application.

Quackenboss said the pandemic has had a devastating effect across nearly all segments of the economy, and that it wouldn’t be surprising to see a business from any industry file for bankruptcy in the coming months.

“Honestly, I don’t know that there are any industries that are safe,” she said.