Some small businesses left in limbo after federal loan program runs out of money
(FOX 9) - The money for federal loans to help small businesses deal with COVID-19 has dried up. President Donald Trump says it is a good thing the money is being used and that Congress is working to negotiate a deal for more funding, but it means more waiting for those business owners left in limbo.
“Last time we talked I shared I had applied for the [Economic Injury Disaster Loan] and [Paycheck Protection Program] and I haven’t gotten anything,” said Jess Birken of Birken Law Office.
Now 13 days later, $349 billion dollars for the federal loan program is all used up.
“It leaves me with a lot of uncertainty and sort of feeling left out,” said Birken. “This was supposed to be support for the little guy.”
Birken runs her own law firm helping nonprofits around Minnesota. She says many of them have received the PPP loan money, but there are plenty of other business owners like her, who have not.
“Those loans probably meant their ability to maintain cash flow over the next 30 or 60 days or longer,” said Vicki Stute of the Minnesota Chamber of Commerce. “Not having that resource now could certainly be detrimental to many companies.”
The Small Business Association’s PPP was one of two major federal loans meant to help. The other was the EIDL. Thursday, the SBA said in a statement they are unable to accept new applications for both programs based on available funding. It will be up to Congress to approve more money.
“We are going to fund this program with more money,” said Rep. Angie Craig (D-Eagan). “The question is how we get it done and how quickly we get it done.”
Republicans have called for $250 billion in additional funding for the PPP, while Democratic leadership is pushing for funding to be tacked on for hospitals and local governments as well. Craig says she just wants to see it worked out soon so businesses don’t suffer.
“I’m willing to go back and vote for all or as much as we can possibly see in that bill with the highest priority being that we fund the small business loan program as quickly as possible,” said Craig.
The Minnesota District office of the SBA provided some additional information for business owners:
- The SBA remains committed to supporting the nation’s more than 30 million small businesses and their employees. As soon as Congress appropriates additional funds, we will quickly open the opportunity for small businesses and non-profits impacted by the COVID-19 pandemic to apply for emergency capital.
- We will continue to process the loan applications in their respective channels as fast as possible to get the available money to the small business owners and non-profits who need it.
- SBA-backed loan Debt Relief remains available and covers all principal, interest and fees on current and new SBA-backed loans made through September 27, 2020, for up to six months.
- Through SBA’s resource partners, small business owners can receive free counseling, educational resources and mentorship online and via phone. Find your local resource partner by visiting www.sba.gov/localassistance.
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