MEDFORD, Ore.– Thousands of small businesses across the country are filing applications to receive help from the federal government’s recently passed CARES Act.
Medford’s Common Block Brewing Company is one of those who have applied due to, like many other restaurants, taking a hit from the coronavirus pandemic. The company says it’s still operating a delivery and takeout service but only been able to keep six of its 45 employees.
However, when the CARES Act passed in March, Managing Owner Danielle Amarotico says they immediately sent in an application and were accepted for the small business loan.
“It feels really nice to know that we have a backup plan,” said Amarotico.
The restaurant is expected to receive funding by the end of the week. Many businesses that have been accepted are expected to receive their funds within 10 business days. With how easy it was for Common Block, Amarotico encourages others to apply as well.
“It’s just a matter of pulling up some reports, again reaching out to your financial advisors, your payroll servicing companies, that sort of thing,” she said.
Like most paperwork, it can be daunting at times but Amarotico says any business that has their payrolls and finances in order, banks should have no trouble figuring out how much money you’ll receive. Local banks like People’s Bank agree and are encouraging clients and non-clients to apply.
“If our businesses don’t operate there’s no income. You want to talk about a recession that would be a severe recession that would be the thing to worry about,” said Ken Trautman, CEO of People’s Bank.
Trautman says on top of the loans the bank provides on its own, as of Monday morning People’s Bank helped file 500 applications worth a whopping $72 million for the Paycheck Protection Program. Of those, 373 were accepted with $61 million in the pipeline to be distributed and Trautman says as of Tuesday, that list is expected to grow.
He added since Monday, the bank has helped more people file applications bringing a total of $25 million in funding requests.
“That tells me there is a lot of demand out there. People are trying to figure out the program,” said Trautman. “They didn’t quite understand it. It’s totally unique to anything I’ve ever seen. I’ve been in banking for 42 years. I’ve never seen anything like this.”
There are issues Trautman says such as a lack of prioritization for the businesses in need of receiving funds the fastest.
Businesses closed due to the state’s executive order may miss out on the loan forgiveness portion of the program. Trautman says they’ve seen this with motels and restaurants they work with who can still apply for the loan based on payroll from 2019. However, in order to receive the loan forgiveness, they need to show payroll for the upcoming eight weeks. The problem is many of these businesses have been forced to close and can’t quickly reopen and hire workers again to meet the loan forgiveness.
“The state may not let them open meaning they have no payroll so the forgiveness may not help those businesses as much,” said Trautman.
On top of all of that, the fund for the PPP set up in the CARES Act is almost empty.
“They gave $349 billion dollars to the program,” said Trautman. “We’re really getting close to the end of that.”
The federal government is working to add an additional package to fund the small business loan. Until then, banks are still encouraging businesses to apply so they have an application in and can receive the funds when they become available.
Trautman says to reach out to your financial advisor or any bank for that matter to learn more about what your business can do to stay open and stay afloat.
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