What's next for businesses left in the cold after the small business loan program ran out of money?

Colorado businesses say funding didn't come
No crystal ball needed to predict those surprise bills anymore
Posted at 5:12 PM, Apr 16, 2020
and last updated 2020-04-16 21:27:00-04

DENVER -- More than 231,000 Coloradans are out of work and scores of small businesses are on life support. If the federal government doesn't get its loan program ironed out, many of those shops and restaurants say they won't be around to see the end of the COVID-19 outbreak.

The emergency Paycheck Protection Program (PPP) that's been keeping many businesses alive has run out of money.

Democrats and Republicans alike want to inject it with more cash, but can't agree on the details.

The Small Business Administration website now reads, "unable to accept new applications." The $349 billion in loan money is already gone.

“It's extremely frustrating,” said John Hardon, owner and president of DCNC Inc. “We were counting on that money. Obviously, as a lot of small businesses are, we have a payroll coming up tomorrow. We will be all right for tomorrow, but moving forward, it’s going to be dicey.”

Hardon owns a computer consulting firm in north Denver. The company has been in business for 21 years and has 23 employees. Hardon was approved, and just closed on his PPP loan Wednesday.

“I signed the documents yesterday. They said that was it,” Hardon said. “That was all I needed to do. The next step was funding, and then we got a message this morning that there were no more funds.”

Hardon banks with T Bank out of Dallas.

Linda Sanders is a self-employed freelance paralegal with a similar story.

“I pay quarterly taxes on what I earn,” Sanders said.

The attorney she works for in Englewood had to furlough her.

Sanders isn’t sure she qualifies for unemployment and tried to get a small business loan for her freelance business that has only one employee – her. She was working through Chase Bank, which she’s been with for nine years now.

“They led me to believe they're going to assist those with business bank accounts first, and if there's any money left, they'll help the little people like me,” Sanders said.

Hardon said Sen. Michael Bennet, D-Colo., and other lawmakers have turned this into a political issue.

“I would ask Senator Bennet why he didn't go ahead and approve the additional funding for this last week when it was on the table?” Hardon said.

Bennet told Denver7 on Thursday the funding was never enough.

“I never thought the $350 billion we put aside for this would be enough,” Bennet said. “I always thought it was a mistake to cap it. We're going to have to do more.”

The Trump administration indicated it is on board with more funding as well.

“It wasn't a Republican or Democrat thing,” said Treasury Secretary Steve Mnuchin. “It was bipartisan. We've committed to small businesses. We should top up that program now.”

As lawmakers fight over funding, the small business owners that need it most, like Hardon, are scraping by for now.

“We actually applied the day these loan applications opened,” Hardon said. “So, why we didn’t get funding is beyond me. I contacted that bank immediately. We moved quickly, got approved and closed yesterday.”

The loans are forgivable as long as small businesses use 75% of the funds to pay employees for eight weeks immediately following receiving funding.

Sanders says she feels like the application process and funding has many pitfalls.

“I only have me,” Sanders said. “So, maybe that's why it's easier to let me fall through the cracks. If banks have the authority to use such discrimination, I would ask lawmakers why they approve of that kind of arbitrary denial.”

Relief that seems to benefit only those who hit all qualifications.

“I’m wondering about the stimulus check, too,” Sanders said. “I don’t even know if I’ll get that.”