Bath and Body Works in the Willamette Town Center was closed. (Saphara Harrell/Salem Reporter)
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Businesses that missed out on a federal program intended to help companies keep workers on the payroll could have a second chance.
On Thursday, Congress is expected to advance legislation that would add $310 billion to the Paycheck Protection Program. Part of the landmark Coronavirus Aid, Relief, and Economic Security Act passed by Congress last month, the program offered an initial $349 billion in forgivable loans to businesses to help cover payroll for eight weeks.
The program ran out of money within two weeks of launching on April 3. Initial numbers released last week by the U.S. Small Business Administration, which oversees the program, show that 18,732 loans worth $3.8 billion were issued to Oregon businesses.
Findings from New York-based banking investment firm Evercore ISI put Oregon near the bottom of states receiving the relief money. Just 42% of eligible payrolls in Oregon were covered by the program, according to the findings first reported by Bloomberg. Oregon ranked 48th for the percentage of payroll covered, just ahead of New York, California and the District of Columbia.
Tom Hoffert, CEO of the Salem Area Chamber of Commerce, said that there were “certainly frustrations and pinch points” as the program was rolled out.
“We are very encouraged that Congress is reloading those dollars as they are vital to the small business community members,” he said. “And I think those businesses in Oregon applaud that effort.”
He said that he’s advising businesses to have their applications complete and in the queue for when the floodgates are opened again.
The program has drawn criticism after reports emerged that large, well-funded companies received loans while small businesses were left out. U.S. Sen. Ron Wyden, D-Oregon, took to Twitter to criticize the program.
“Instead of helping struggling small businesses in Oregon and across the country, federal relief funds are going to wealthy companies and Donald Trump's friends,” he said on Sunday. “The Trump administration is politicizing aid for the American people during a pandemic.”
The new legislation adding money to the program will set aside $60 billion for credit unions, community financial institutions and smaller lenders.
Marcy Lantz, a CPA and partner at Aldrich CPAs + Advisors LLP, also advises businesses to act quickly and expects the new money to run out. She said in an email that businesses that previously submitted applications to their banks but were not funded should contact their bank to determine if it will be submitted for the new round of funding.
“We have heard large banks are not accepting new applications (US Bank, Bank of America & Wells Fargo) but will continue to process applications that were received when initial funding ran out,” she said. “If this is true, it seems a new applicant would be better off reaching out to a smaller bank or local credit union now. By organizing required information now they could be positioned to file the application as soon as the funding is available.”
Congressman Kurt Schrader, a Democrat who represents the Salem area, didn’t respond to an email seeking comment.
Contact reporter Jake Thomas at 503-575-1251 or [email protected] or @jakethomas2009.