Second Cycle PPP Loan Applications for Local Businesses and Banks | Economy
Applications for the second round of Paycheck Protection Program loans were opened last week, and so far local banks and businesses say the process of securing much-needed federal funding for small businesses is much easier than the first round of COVID-19 relief last spring.
“The process is going well,” said Mark Bodin, chairman of the Walpole Savings Bank. “We communicated with all of our clients several times in advance and it helped them prepare early. The process seems a lot less stressful this time around. The last time the rules were written in the process, there was a race for funds. Everyone has more experience this time around.
The latest COVID-19 assistance program, enacted into law on Dec. 27, included more than $ 284 billion for PPP loans, which are administered by the Small Business Administration and designed to help small businesses keep their employees on. payroll during coronavirus-related or temporary downturns. closures.
In the new round of PPP funding, at least $ 25 billion is earmarked for “second draw” loans for small businesses that also received funding during the first cycle of the program. Over 1,500 businesses and nonprofits in the Monadnock area have received a total of over $ 100 million through the first round of PPP loans.
Beeze Tees Screen Printing, which has stores in Keene and Manchester and a production facility in Marlborough, received a PPP loan last spring. He spent all the money on salary expenses in three months, owner Tim Pipp said. The company, which has around 17 employees, is now applying for another loan, as business generally slows down, he added.
“It would jumpstart us for the year,” Pipp said. “We can generally handle the loss we see in the first quarter and can predict at a few hundred dollars what business will happen. This year is unpredictable and we need to make sure we can fully function with staff and overhead. “
Bodin said Walpole Savings Bank received around 90 second-round PPP loan applications, totaling around $ 10 million. He added that they are “overwhelmingly” second-draw contenders, like Beeze Tees. These companies looking for second-draw PPP loans have additional application requirements, Bodin said, such as documenting at least a 25% drop in revenue in at least one quarter of 2020.
“It’s not hard to prove for most given the realities of 2020, but it’s one more step for borrowers to prove,” Bodin said.
The NBT bank in Keene is also seeing more second-draw loan applications than first-time applicants, according to Ben Wheeler, the bank’s senior director of commercial banking relationships. At Brattleboro Savings & Loan, President & CEO Dan Yates said the second round application process is going smoothly, but overall there are fewer nominations compared to the first round.
In addition to businesses, nonprofit groups like the Keene Family YMCA are eligible for PPP loans. Dan Smith, CEO of Keene Y, said the organization was approved this week for a second PPP loan of around $ 400,000.
“In both cases, the loan made the difference in terms of being able to get through this pandemic,” Smith said. “They don’t make up for all the shortfalls, but they certainly make it easier for us to keep our staff employed during this time and keep our doors open. “
Smith noted that while donations to the Y have remained relatively stable, its other two main sources of income – memberships and programming – have fallen sharply during the pandemic.
“It helps us support until we are able to increase the number of memberships and programs again,” he said.
Keene-based tree-Free Greetings greeting card company has also been approved for a second PPP loan, CEO Steve Silverstein said. The company’s first loan kept its 18 employees working, he said, and Tree Free has already secured full discount on the original loan. PPP loans can be canceled entirely if the companies that received them spent the money according to certain criteria, such as paying labor costs, mortgages, rent and utilities.
Silverstein said the second drawing loan will help Tree-Free continue to offset shortfalls caused primarily by slowing retail sales.
“We’re the number one greeting card at Whole Foods nationwide, and they’ve lost 30 percent of foot traffic,” he said. “… [The PPP loan] allows us to keep people employed and add long-term value for the consumer as the pandemic does not end and retailers are still struggling. “
Applications for first and second draw PPP loans are open until March 31, according to the SBA. Pipp, the owner of Beeze Tees, said he encourages all small businesses to find out if they are eligible for a PPP loan and consider applying.
“For businesses that haven’t applied or are unsure whether they qualify, call your bank and talk to them,” he said. “They want to help and this money is there to keep us going. “