Lake Havasu City small businesses that missed the window for Small Business Association Paycheck Protection Program loans will get another chance next week.
President Trump signed a congressional bill Friday that will reopen the window for small businesses to take advantage of an additional $310 billion in federally-backed loan funding, after the success of the SBA’s Paycheck Protection Program loan package earlier this month.
The original program allowed businesses of fewer than 500 employees to receive loans as much as $10 million, in order to provide payroll during the continued impact of a nationwide coronavirus epidemic. Some or all of the loan funding could be forgiven, according to the U.S. Treasury Department, if employers could prove the majority of funding was used to provide pay and benefits to employees. Two weeks ago, the program placed a hold on all new applications when the program ran out of funding.
At Havasu-based Foothills Bank, formerly known as Mohave State Bank, more than 300 businesses throughout the state have had loan applications waiting for the second round of loan funding to begin.
“We’re excited for the community, and for business owners who were left out in round one,” said Foothills Bank CEO Brian Riley. “The program has taxed our resources, and we’ve had 65 people working 15-hour days, seven days per week, for the past three weeks to process these loans.”
According to Riley, little will change during the second round of funding, although he says efforts will be made by the U.S. Treasury to curtail funding to businesses that don’t otherwise need it. Riley cited New York-based, publicly-traded business, Shake Shack, as an example. Shake Shack returned its $10 million small business loan after receiving pressure from the Treasury Department this week.
“There’s a strong move to force some companies to repay those loans by May 1,” Riley said. “Some of the larger companies have already repaid them.”
Despite demand for loan funding among Arizona small businesses, the state ranked last in processed applications under the PPP loan program.
As of Wednesday, the Associated Press says 19,280 small business loans were approved throughout Arizona under the program, totaling an estimated $4.8 billion. According to reporting this week by CBS 5, in Phoenix, Arizona business owners received the fewest number of loans under the program, per capital, in the U.S.
Funding for the second round of PPP loans is scheduled to begin Monday at 10:30 a.m., Eastern time.