The Paycheck Protection Program was supposed to bring a glimmer of hope to small businesses in the U.S. during financially crippling times; instead, millions of small businesses found themselves stranded without receiving a penny in government aid.

“If these small businesses are the backbone of the country,” said John Hatch, owner of Texas Petition Strategies, “then why aren’t they getting money?”

Hatch questioned the process, especially after numerous headlines show that big businesses like Shake Shack or Ruth’s Chris Steakhouse received millions even though their business was already booming. And the New York Times reported that “dozens of large but lower-profile companies with financial or legal problems” received $750 million in bailout loans.

Still, other local businesses and organizations report that they were able to get a loan.
The businesses that did not receive a loan, even though they seemingly did everything right, are speaking out about the lack of loans.

And banks, through which businesses must apply, are working in uncharted territory and they do not have all the answers.

“This program – in terms of size and scope – has been unprecedented,” Broadway Bank CEO David Bohne said. “The challenge has been time. We’re working to process the same amount of SBA loans we might work over a five- to six-year timeframe. And we’re doing it in weeks. I’m so proud of our Broadway bankers.”
According to the U.S. Chamber of Commerce, in 2018 there were about 8.2 million small businesses in America. Only about 1.7 million businesses were able to get their hands on the money, reported the Small Business Administration.

In the first wave of loans, the government allocated $349 billion to aid small businesses, which are defined as businesses with 500 employees or less. On Monday, the PPP loans opened a second wave of $310 billion. Some banks, like Broadway Bank, will process applications from the first round before they input new applications. Texas received the highest amount of loans, totaling $28.5 billion spread across 134,737 business, as recorded by the SBA.

Even though statistics set Texas apart from other states, many business owners in Hays County felt confused by the process and its results. They banked through big banks and small banks, they submitted their applications
in a timely manner, and they still got nothing.

“If $350 billion is available and we got our application in on day one, how did we not get it?” Hatch’s question rings true for many of the applicants.

Billy Bonham, owner of Pizza Classics, said he applied for the loan two days after the program launched. His bank later emailed him saying he probably will not receive the loan, but at the time, they did not give him a hard-no for an answer.

Pizza Classics has 10 employees and none have been laid off so far, which he feels fortunate about; still, any financial aid would help, Bonham explained. Business has not completely stopped for his restaurant, it just slowed down.

That is not the case for his neighbor and friend, Will Caldwell, who owns Dojo Kyle. Caldwell said he has been closed down since the shelter-in-place, so he applied for the PPP loan and never received the funds.

Still, other locals did receive funds.

Amy Ledbetter Parham, executive director at Habitat for Humanity Texas, was able to secure a loan for her staff. She advised that businesses apply early, try to develop a professional relationship with the banker and constantly push for updates on the application.

Even though Parham’s work may be considered one of the lucky few that received financial support, she believes there has to be a bigger long-term plan.

“It’s a big relief,” Parham said, “but I’m still nervous that it covers eight weeks. That will get us to the end of June and I have a lot of worry about what will happen after that. [PPP loans] bought us time but I don’t see a way forward. We’re not going to be healed economically or from the virus by the end of June; it’s
a breath, not a solution.”

Parham suggests that business owners go to state representatives, congressmen and senators, and tell them “we still need to be served.” She believes everybody, even those who got PPP loans, should contact their representatives so they can put a long-term plan in place; she is not alone in that line of thinking.

Without the loans, businesses are having to cut staff. Ilario’s Italian Cuisine and Catering also applied and got the same tired message from its bank.

“We have already cut our labor down by 50 percent,” said Keith Born, manager at Ilario’s. “We let some people who have a second job go or those living with parents; we had to prioritize our staff for those supporting themselves or a family.”

This once crowded and vibrant restaurant is down to its skeleton crew; they have had to cut back work hours and like everyone else, they have resorted to curbside pickup. Born said they are doing good for the situation they are in, but that is thanks to their loyal customer base.

One business found difficulty in applying beginning with step one. All American Wastewater Solutions applied through BBVA Compass and, at first, the bankers helping the company’s owner, Judy Sullivan, did not know about the program or how to help. Sullivan kept making calls until someone at the bank finally gave her direction – the process took almost two weeks.

“I just have a lot of questions,” Sullivan said, “and it seems like no one knows the answers to those questions, even the application seems like it was thrown together.”

She reached out to her accountant to get clarification on the process, wondering if anyone received the loan. Sullivan got the response she expected to hear; “she has not heard back from any clients receiving the loan.”

A variety of businesses and services applied for the PPP loan. Sandy Maloney, owner of Interstate Towing & Recovery of Kyle applied with a smaller bank on the same Friday the loans opened.

She has lost 70 percent of her business because those who get towed cannot afford to get their vehicles back. Decline in business has led to lower wages for the tow truck driver and a large drop in revenue.

Unsure why she did not get any money, Maloney began questioning if it was the size of her business or if perhaps she applied too early. She does not have an answer.

Barton Publications, owner of Hays Free Press and News-Dispatch, was able to get a loan to help for two months.

Publisher Cyndy Slovak- Barton said, “I really believe that it is because we dealt with a local bank and got the application in before it was even approved. We turned in an application and then had to do it again, as the application changed.”

Slovak-Barton said she turned in the application on Friday, got a call from Broadway Bank on Saturday, turned around the questions, and the banker sent it in on Sunday.

“Local, local, local … I think that’s why we got it through, because of a local bank, and the fact that
my neighbor pushed the idea with me. We both got the loan because we didn’t wait, we moved quickly,”
she said.

Hatch, though, wants to make sure Buda businesses get their loans. He described Buda as a great microcosm, a perfect petri dish that proves why this program is needed. He said this is the level of companies that should have gotten a chance with this program.

Hatch applied for the loan when it opened up and did not receive the PPP loan. His business has nine employees and their grant would have been a little under $50,000. When he filed his request, his employees were told not to file for unemployment because they were stay on the team. Hatch was anticipating that he would get the loan to specifically keep everybody employed.