Aid begins to trickle to troubled companies
MOSES LAKE — Gov. Jay Inslee was only a few minutes into his formal announcement on Tuesday of grants of up to $10,000 for struggling small businesses when the first applications arrived at Grant County Economic Development Council.
“We already have a few in,” said EDC director Brant Mayo. “We’re hoping to have the first wave vetted in the next seven to 10 days.”
Mayo said the grants from the $5 million Working Washington Small Business Grant program would be “very competitive,” since every business in the state with 10 or fewer full-time employees that has been in business for at least one year would be eligible to apply.
“$5 million spread throughout 39 counties doesn’t last too long,” Mayo said. “But every little bit helps.”
The grants were just one of the initiatives Inslee announced at a Tuesday press conference.
“Thousands put their lives into small businesses,” Inslee said during the press conference. The $10,000 grants are “targeted at the most vulnerable.”
Inslee said this aid was likely only the beginning, and more would have to be done.
“We have a long economic recovery ahead of us,” he said.
While applications for the grants are going through the Washington State Department of Commerce’s website, applications are going through county EDCs and local chambers of commerce in order to ensure “equity” statewide in their distribution.
“We’re putting in place a way to have some regional equity,” said Lisa Brown, state commerce department director. “We’ll evaluate them by county to make sure there is even distribution throughout the state.”
In addition to the grants, businesses in Washington also have access to five kinds of Small Business Administration loans, two through the SBA itself and three through SBA-approved lenders.
The two largest small-business loans — the Economic Injury Disaster Loan (EIDL) and the Paycheck Protection Program (PPP) — are intended to help companies meet payrolls even during downtime so they can come back more quickly when the COVID-19 pandemic ebbs, according to Kelly McPhee, vice president of communications at Banner Bank, which, she said, is the largest small-business lender in Washington.
The PPP loans are part of the more than $2 trillion in relief that Congress passed two weeks ago, which included $349 billion in loans to small businesses and non-profits to keep employees on payrolls and off unemployment insurance.
According to the SBA’s website, to qualify for the PPP loans, businesses must have 500 or fewer employees.
Portions of loans used to pay employees will most likely be forgiven, McPhee said, but the rules were still being written even as banks began processing loan applications last Friday.
“It’s like changing tires at the same time you’re driving the car,” McPhee said.
Economic injury loans — the EIDLs — are made directly with the SBA, according to Allan Peterson, head of the Small Business Development Center in Moses Lake. Companies can apply for both loans, and many of the same conditions pertain to both loans, but companies cannot “double dip,” or use both EIDL and PPP loans to cover the same expenses.
“They will roll the EIDL into the PPP so there’s only one loan,” Peterson said.
According to Debbie Doran-Martinez, head of the Moses Lake Chamber of Commerce, the rules and forms for the EIDL have changed several times over the last week, and so anyone who submitted an application for that loan prior to March 30 will need to apply again.
“If their application did go through before then, they need to apply again on the new streamlined application, which I am being told is very easy and you do it online with SBA,” Doran-Martinez said.
Because demand for loans has been high and is stretching some banks to the limit. McPhee said that Banner has limited SBA loans to existing customers right now, and the company has cross-trained 60 employees to handle the volume of PPP loan applications.
Banner Bank has 193 branches in four states — California, Idaho, Oregon and Washington — with nearly half of those in Washington.