As of yesterday morning, the SBA had added an alert on their website that stated the following:
Lapse in Appropriations Notice: SBA is unable to accept new applications at this time for the Paycheck Protection Program or the Economic Injury Disaster Loan (EIDL)-COVID-19 related assistance program (including EIDL Advances) based on available appropriations funding.
EIDL applicants who have already submitted their applications will continue to be processed on a first-come, first-served basis.
After I saw this, I started asking around to see if some of our local small businesses had received their loans. The results: Some have received funds, most have not heard anything back from their lender, and some received a loan number but they are not sure where their loan stands. Will it be funded? Will it not be funded? How much can they expect to receive? Crickets. Please note that I am not blaming anyone in this situation. Bankers (many of whom that I know personally) have been working tirelessly to try and get funds to their applicants. But to be honest, the whole thing was a bit of a Poop Sandwich from the start, and with the SBA approving 14 YEARS worth of loans in 14 days, things were bound to get messed up and funds were bound to go where they weren’t needed most, which can happen a lot with government programs.
Data has been trickling out about where the funds have gone, and you can see some of it here. But the CliffsNotes as of April 13th are as following:
- Loan Approvals (Not Necessarily Funded): Over 1 million loans at almost $250 Billion in funds
- Some large public companies have received millions in aid
- 4,664 Lenders have participated
- Indiana Accounts for 23,583 Loans (2.27%) and almost $6 Billion (2.4%)
- 70% of Loans but only 15% of the Dollars spent were $150,000 and under
- 9.9% of Loans were $350,000 – $1M but they made up for 24% of the Dollars Spent
Many others will be writing about the shortcomings of this program more eloquently than I can. So without getting into any more details, here are some ideas for the next steps you can take:
- If you have not yet applied, or applied for the PPP or EIDL and your loan is in limbo, use this time to get your stuff together in case Congress does grant additional appropriations. Not sure what you need? Here is the most recent information from the SBA which includes guidance for Independent Contractors and Self-Employed Individuals.
- If you think your particular bank has not been up to the task or slow in handling your loans, get ready to apply with Paypal, Square, or Intuit, which may be better to suited to handle a higher volume of applicants based on their technology.
- If you are self-employed or an independent contractor and your business has been impacted by COVID-19, you can file for the $600 weekly federal unemployment benefit from the CARES Act. Indiana is still working on updating their system to allow it, but you are encouraged to apply anyway. When it is fixed, payments will be retroactive back to late March.
- Call or email your Representatives and Senators. Their information can be found here. Our Representative is Jim Baird (the first one listed) and our Senators are Braun and Young.
- Sign our Change.org petition to get our Congress back to the table.
Our Small Businesses and Independent Contractors are hurting right now. As of 2016, 406,919 of our state’s 512,348 small businesses are Solopreneurs. Small businesses in total make up 99.4% of all businesses in the state and 44.9% of all Indiana employees. This is a huge part of our economy and they are being left behind. They were told to wait until April 10th to apply to the first come first serve Paycheck Protection Program that started accepting application on April 3. Their guidance has been updated continuously and banks have been unsure how to categorize them until recently. They cannot even get the unemployment assistance here in Indiana yet, because our system isn’t set up for it. We need to do what we can to help.
If you know of anything else we can do to get the ball rolling, please let me know. I will be emailing and calling our Representatives and Senators today to try and get them back to the table.