SCOTTSDALE, Ariz. - Small businesses have taken a big hit as a result of the ongoing COVID-19 pandemic, and on Thursday, a program that is set to provide them with emergency loans has also run out of money.
The program, which launched less than two weeks ago, provides loans at ultra-low interest rates to businesses with fewer than 500 employees to incentivize them to keep staff on payroll, or rehire workers who have already been laid off. If at least 75% of the money goes to keep employees on the payroll, the federal government will forgive the loans.
The Small Business Administration said on its website that the agency is "currently unable to accept new applications for the Paycheck Protection Program based on available appropriations funding. Similarly, we are unable to enroll new PPP lenders at this time."
With that, businesses that didn't get a chance to apply will have to wait on Congress to approve more funding.
Although Republicans and Democrats agree they need to replenish the evaporated funds for the program, a $349 billion fund approved last month as part of the CARES Act, they have remained at an impasse over how to do so.
Arizona business owners react
Melissa Fink’s entire Girly Girlz party venue in Scottsdale has been affected. Fink sells craft bags online for parents and kids, but it’s not nearly enough to keep nine employees on.
"On a week where I would typically make thousands, I made $150, which is nice, but it’s not enough to pay the bills," said Fink.
Fink, like so many others, turned to the SBA for a disaster loan and the Paycheck Protection Program. It wasn’t easy, and Fink said she couldn't even find a bank to take her PPP application.
"In a matter of 14 days, we processed what SBA processes in 14 years," said Miryam Barajas with the SBA. "We’re hopeful Congress can extend the program, so we can continue helping small businesses."
"Maybe my story and others can put pressure on them to act quickly, but I don’t know," said Fink.