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Business owners share worries with Shaheen over PPP provisions
Several small businesses and nonprofits across New Hampshire told U.S. Sen. Jeanne Shaheen that the Paycheck Protection Program has provided much needed short–term relief to keep employees on the payroll in the midst of the Covid-19 pandemic, but they also had complaints about the program including uncertainty about loan forgiveness.
Dave and Melissa Levin, owners of Mad River Coffee House in Campton, told Shaheen in a conference call earlier this month that the process to obtain an $82,000 loan went smoothly because of a strong relationship with their bank, but Dave Levin said he is reluctant to spend the money without fully understanding the requirements for forgiveness.
Under the PPP, small businesses can receive 1% U.S. Small Business Administration loans through their bank. To be forgivable, 75% of the money must be spent on payroll over an eight-week period and the rest on mortgage interest, rent or utilities.
Levin said that in the loan closing, “nothing regarding forgiveness was in writing. I signed paperwork that I got a loan and I was going to pay it back in two years. I would like to use it for hazard pay, bonus pay, but without rules for forgiveness I don’t feel safe using the money, so I am using as little as possible.”
As a seasonal business, Levin said the requirement he maintain staffing levels as one of the conditions for loan forgiveness is simply not reasonable.
“There is no proof that come July 1 I’m going to need the same staffing we had in the middle of the White Mountains ski season,” Levin said.
Levin’s comments were echoed by Adria Bagshaw, owner of WH Bagshaw, a Nashua-based manufacturer of pins. “There is no proof, senator, that the loan will be forgiven,” Bagshaw told Shaheen.
“There is nothing in the loan guarantee we signed.” Shaheen said she was sympathetic to both Levin and Bagshaw and promised to bring their concerns back to Washington.
“I think the issue is not the intent (of forgiveness) but reassurance and guidance,” Shaheen said.
The hour-long conference call was a wide-ranging discussion of the experience of businesses and nonprofits that have successfully applied for a PPP loan. Shaheen said she was looking for input she could take to Washington to make improvements.
“My hope is I can learn what is good and changes you would like to see,” Shaheen said. “There are challenges that have arisen with the program,” she acknowledged. “It has not worked exactly as intended and some of that is a result of how quickly it came together.”
In response to several participants who said their money for eight weeks of payroll will run out in June, Shaheen said a fourth stimulus package will likely be forthcoming but said it is too early to say what type of assistance will be included.
