Paycheck Protection Plan Recipient Says Loan Is 'Incredibly Bad Fit' for Businesses

Due to the ongoing coronavirus crisis, many businesses across the country have been hit hard. In response to this issue, the government has been granting Paycheck Protection Plan (PPP) loans to various businesses to help keep them afloat amidst this difficult time. But, as Heather and Nathan Sanborn of Portland's Rising Tide Brewing Company explained to CBS News' MoneyWatch recently, receiving this loan hasn't been without its hardships.

According to Heather, the couple received their PPP payment on April 8. She told the publication that they received $200,000, an amount which is 2.5 times their average monthly payroll from last year. As she noted in her interview with CBS News, one of the struggles that she and her husband faced with this loan was the timing of it. She explained, "We had hoped to be able to choose a different eight-week period during which to spend our loan. We wanted to postpone the funding of the loan in order to have it line up with a later period during which we might have more robust operations."

Heather went on to explain that they were not given the opportunity to choose when they would receive this loan. She explained, "But we were not given that opportunity, based on the way the Small Business Administration and the Treasury Department rolled out this program." As she continued to relate to the outlet, the way that the program was rolled out actually put her business in a difficult position.

"Money is always useful, especially right now when it's not coming in," she said. "But we were forced into a position where we had to immediately apply or risk having the funds run out. Then we were required to close immediately. If things stay the way they are, we anticipate we will be eligible for very little forgiveness — if any. And that's pretty upsetting." Heather continued to relate that she and her husband are not in a unique position here. In fact, many other business owners are in the same boat amidst this crisis.

"My situation is quite typical of the businesses that are most dramatically impacted by the crisis, including bars, restaurants, breweries," she noted. "We were among the first businesses that were first asked — and then ordered — to close in order to keep everyone safe, and yet the PPP as it's being implemented is an incredibly bad fit for what we need. I want to use my PPP money to help bring everyone back once it's legal and safe for me to do that, and I won't be able to because of the restrictions on the loan. I don't think Congress understands this wrinkle."

In addition to granting loans to businesses amidst this time, the White House and Congress previously agreed to a $2 trillion stimulus package in the hopes that it would give a jolt to the economy. The package not only entailed aid to businesses, but it also entailed that eligible Americans would receive a one-time check of $1,200 for individuals and $2,400 for couples filing a joint tax return.