Over pizza, SBA chief surveys agency’s vast CT reach
You might not expect the head of the U.S. Small Business Administration to appear on an official visit at a municipal wastewater treatment plant, talking about SBA programs. Sewage plants, of course, are neither small nor business, other than the business of turning human waste into drinkable water.
But Isabella Casillas Guzman was there Thursday at the Meriden plant, alongside a brand new, gleaming-in-the-sun, $43 million processing section for phosphorus and other stuff, touting the SBA’s role with Gov. Ned Lamont and other top state officials.
SBA famously backs loans to small businesses and, during the coronavirus crisis, it has overseen — get this — $13.6 billion in federal grants and loans in Connecticut, mostly under the Paycheck Protection Program and the Economic Injury Disaster Loan program.
Guzman had just arrived in Meriden from New Haven, where her whirlwind tour of the Shubert Theater and the three most famous pizza purveyors — Modern, Pepe’s and Sally’s — left her extremely well fed and, we hope, impressed with Connecticut’s signature dish. She also had a healthy serving of stories from the operators of those businesses about how they’re recovering from the pandemic’s hard hits.
“We were knocked down and we got up and we were knocked down again and we got up and we were knocked down again and your hand was there to pick us up,” Brian Phelps, president of Toad’s Place, the music venue, told Guzman during her tour of the Shubert Theater.
That hand was worth $1.5 million through the PPP and the Shuttered Venue Operator Grant program, which distributed $143 million in Connecticut. Phelps later told me he was able to keep paying his key employees and would have lost them and had to refinance the building where Toad’s is located to stay afloat. Venues that don’t own their own property would not have that option.
The treatment plant? That’s a less heralded role of SBA, helping suppliers, skilled trades people, engineers and other small businesses qualify for federal contracting work. And under the new, $1.2 trillion Bipartisan Infrastructure Law, there is a very large amount of that kind of contracting coming.
Connecticut expects to haul in $6 billion under the infrastructure plan, more or less, and a lot of that will go to contractors. SBA helps to qualify those firms for federal contracting, especially those owned by women, veterans and people in racial minority groups.
“Obviously we’re focused on trying to create millions of jobs and it’s important to remember that that small businesses create twothirds of net new jobs and employ nearly half the private workforce,” Guzman said from the podium.
Those jobs figures, which we hear a lot from small business, cover some fairly large small businesses, sometimes with payrolls in the hundreds of people, depending on the industry. So it’s not just mom-andpop stores.
In an interview, Guzman said the programs have worked smoothly overall, despite some well publicized glitches, and that a high percentage of PPP loans are being forgiven, as planned. So far, 93 percent of the first round of PPP loans have been deemed grants as the recipients met the rules, and about 60 percent of the second round, Guzman said, with those forgiveness applications still underway.
“It’s been very effective in helping save businesses,” she said. “It’s allowed them to pivot and adapt so that they could survive.”
She described a simplified application form for businesses, which takes just six minutes for those who received under $150,000.
“Some businesses who chose to use those funds for different purposes and not follow the 60-40 split on payroll costs ... they might choose to take it as a loan,” she said.
Guzman said the transition at SBA between the Trump and Biden administrations has brought a higher priority on “equity and leveling the playing field for all of our businesses.”
“We’ve tried to approach all of our programs, including the relief programs, with that lens of equity,” she said.
The Economic Injury Disaster Loan program, originally up to $150,000, has been expanded to as much as $2 million, with more generous terms, she said — and is still open to applications at www.sba.gov through Dec. 31.
Overall on the COVID-19 relief programs, she said, “What we’ve tried to do in the Biden-Harris Administration is make them more accessible ... they’re customer-friendly, they’re technology forward.”
She declined to comment on problems or controversies such as the fact that some publicly traded companies were able to access PPP money — a defensible move when it comes to saving jobs that was criticized by some who said those corporations had access to money elsewhere and tended to be larger.
“Each circumstance is unique,” she said.
Guzman, who owned several businesses in her home state of California and worked at SBA in the Obama Administration before Biden tapped her in March, talked about the coronavirus business stories with Catherine Marx, the Connecticut district director, over pizza in a tent at Sally’s.
“During the COVID pandemic, the SBA stood up many programs, many first of their kind programs, that the evidence will show you had an economic relief effect on Connecticut and the United States,” Marx said afterward.
At the Shubert, Guzman was treated to an Obama impression by executive director Anthony McDonald, who told her about procedures for making sure patrons are vaccinated, tested or both.
The group toured Sally’s, which of course was full heading into the lunch rush, and heard some history of the place where Sal Consiglio made every pie himself for more than 40 years.