The Small Business Administration's Payroll Protection Program (PPP) loans were meant to help small businesses stay afloat during the pandemic, but now many business owners who received the loans say they're struggling to meet the demands the loan requires for forgiveness.
Businesses must use 75% of the money to pay their employees and they must use the money within eight weeks in order to get forgiveness. Karen Adams has owned the Bay Park Fish Company for 15 years and says she felt blessed when her business received a PPP loan in the second round.
"It's been really tough and without this PPP loan that we just got, we probably had about eight more weeks," she said.
She received the loan May 5 and has been able to bring back 34 of her 46 employees, but says it is difficult to bring everyone back with no inside dining allowed.
"The clock starts ticking the day you get it and you have eight weeks to use it and at this point we don’t have our entire staff back here. We don’t need our entire staff because we can’t fill this room," she said.
Keri David Duffy received PPP loans for two of the three salons she owns, but says she has no idea how she is going to bring many of her 80 employees back to work when salons haven't been allowed any business at all.
"If we started using it too soon and brought people back on, we didn’t know when we’re going to be open and then they're going to have to get booted off it and then try to get unemployment again which has proven to not be easy for a lot of people," she said.
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She says at this point with a 1% interest rate and an 18 month period to pay the loan back, she's not sure if she should use the money at all.
"We need to make sure that we have loan forgiveness, but with the clock ticking and not being open yet we’re in a challenging position," she said.
Many business owners are now looking to Washington to change the stipulations of the loans and extend the eight week time period. According to the Small Business Administration, the eight week period the loan must be used starts when the money is disbursed to the business.
