Entrepreneurs worry relief package won't do enough to help most Minnesota small businesses
Alicia Hinze says the current relief package will do little to help her St. Paul business stay afloat. (FOX 9)
ST. PAUL, Minn. (FOX 9) - Several small business owners in the metro are voicing their concerns that recently passed relief bills don't go far enough in providing financial protection.
For many businesses, the orders on COVID-19 have sent their businesses into a tailspin. For the owner of the Buttered Tin, a St. Paul bakery, she had to lay off all of her hourly workers for now.
Now, Alicia Hinze is trying to maintain just delivery and take out but she says piling on more debt with no end in sight is just not good business.
“I was very upset to hear that this is a solution, to take on more debt for this," she explained.
Hinze is trying to maintain some revenue by doing take-out but it's not nearly enough to cover her payroll. She was hopeful both federal and state stimulus packages would keep her afloat but she's concerned these deals don't really offer relief at all.
"This is craziness, so we are supposed to take on a loan with interest while we have zero income," she said.
Part of the loans from the Small Business Administration are forgivable, but the company has to stay in business for at least two years. However, a lot of small businesses may not be able to last that long.
"Certainly, the small business loans that are available are a great tool for some businesses to be able to access money and keep cash flowing through their businesses right now," she added. "But for other businesses, there is going to be limitations on it that requires them to take on credit which they’ll have to pay back eventually.”
Hinze says she and other business owners, who have faithfully paid insurance which includes business interruption, doesn't cover pandemics or viral outbreaks.
Her plea is to enable insurance companies to give payouts now to small business owners so they can make good on their loans and get their staff back to work.
"In between the state and the SBA, they could probably work together to come up with a solution and figure out insurance companies can cover us," she concluded.
Business owners say they've been told a loan should get to them in 21 days. But they know how overwhelmed both federal and state governments are right now.
In the meantime, they continue to rely on faithful customers to help them out.