FEDS RELEASE DATA ON WHO RECEIVED PPP ASSISTANCE
In Colorado, 103,000 businesses took out $10.3 billion in loans
The U.S. Small Business Administration provided more details about the Paycheck Protection Program on Monday, including the names, addresses and industries of borrowers who took out loans of more than $150,000.
Nearly 103,000 Colorado businesses and nonprofits borrowed $10.3 billion under the Paycheck Protection Program as of June 27, including 13,385 who borrowed more than $150,000 and 95 who received more than $5 million, according to the latest counts from the SBA.
Although firms shut down by pandemic closures sought help, such as the Blue Bonnet Restaurant and the Appliance Factory, so did law firms like Davis Graham
& Stubbs and personal injury attorney Franklin D. Azar, the Strong Arm.
About one in six small businesses in the state accessed the program, which was designed to provide employers 2.5 months’ worth of payroll expenses to cope with disruptions from the COVID-19 outbreak. If the funds are primarily used to cover labor costs, the loans become forgivable.
Initially, there were concerns that banks, who provided the loans, were providing preferential treatment to their largest borrowers, and that firms with political connections or those who had other programs they could access were benefitting at the expense of small firms.
“It seemed like the lenders wanted to deal with the big companies and that the Main Street businesses were getting left out,” said Tony Gagliardi, Colorado State Director of the National Federation of Independent Business.
Accessibility concerns eased when Congress provided an additional $320 billion to the program after the first round of $349 billion ran out in just a couple of weeks in early April. Carve-outs were made for small loans, and the program still had nearly $130 billion left to lend out at the end of June when it was supposed to end. It was extended through Aug. 8.
Pressure has mounted for greater transparency about who
received taxpayer funds. After resisting at first, the Treasury Department relented and on Monday identified roughly 650,000 borrowers or 15% of the total. In Colorado, there were about 91,000 borrowers who took out PPP loans of under $150,000. They were not named.
The more detailed information shows that industries less directly impacted by the pandemic, such as manufacturing and construction, received a greater proportion of the loans than the hardest-hit industries like restaurants and hotels.
Many law firms and private equity companies also sneaked in there, as did public companies that had access to other capital sources, religious and cultural institutions, and nonprofits.
Nationally, businesses owned by politicians also borrowed from the program, including a minor league baseball team owned by the family of the governor of Ohio. A large franchisee of Wendy’s, Taco Bell and Pizza Hut restaurants, whose CEO is a major donor to President Donald Trump, received loans totaling $15 to $30 million, according to the Associated Press.
Other recipients included Kanye West’s clothing and sneaker brand Yeezy, Ice Cube’s professional basketball league, Planned Parenthood clinics in more than two dozen states, including Colorado, the nonprofit arm of the anti-tax group headed by Grover Norquist, Americans for Tax Reform, as well as Rosenblatt Securities, one of the biggest names on the floor of the New York Stock Exchange.
Colorado borrowers in the $5 million to $10 million range included restaurant chains Big Daddy’s and Boston Market, contractors Gerald H. Phipps and Haselden Construction, moving firm Graebel Companies, luxury travel firm Inspirato, and the Rocky Mountain Cancer Centers.
There were another 438 Colorado borrowers in the $2 million and $5 million range. They included restaurant chains Modmarket and Mad Greens, the Phil Long and O’Meara
Ford dealerships, the Southern Ute Indian Tribe, and robotic toymaker Sphero.
A multitude of local religious groups and congregations received government help, including the Archdiocese of Denver, Temple Sinai, Cherry Hills Community Church, Flatirons Community Church, New Life Church, Mile Hi Church and several Catholic parishes.
Cultural institutions of all stripes sought federal assistance, including the Denver Art Museum, the Colorado Museum of Natural History, the Children’s Museum of Denver, the Denver Zoo, the Denver Center for the Performing Arts, the Colorado Ballet, Opera Colorado and the Colorado Symphony.
And in a worrying sign for the future, several groups who help those in need sought help themselves, including the Denver Rescue Mission, Jewish Family Service, Catholic Charities of Central Colorado and the Mile High United Way.
“Without this incredible economic lifeline, tens of thousands of businesses would have closed their doors, forever eliminating countless local jobs,” Dan Nordberg, the SBA’s Region 8 Administrator, said in a statement.
But the program was only intended to carry the economy through a short interruption from the pandemic, which is now threatening to have a longer-lasting impact. The Treasury Department initially required the loans to be spent within eight weeks of being received, though that was later extended to 24 weeks.
Many small businesses have already run through their PPP money and still face sharply smaller demand, as consumers remain wary of returning to previous habits of shopping, visiting gyms, or eating out. Texas, Florida, California, New York and others states have reversed their reopenings, closing down bars and delaying the onset of indoor dining.
“The biggest issue is that PPP is short-term help,” said Adam Ozimek, chief economist at Upwork, a freelancing platform. “And now we’re dealing with a mid- to long-term problem.”
The Associated Press contributed to this report.