Coronavirus News: Small business owners struggle with PPP as money begins to run out

ByKristin Thorne WABC logo

Tuesday, May 5, 2020

Small business owners struggle with PPP as money begins to run out

Kristin Thorne reports small business owners across the area have been struggling with the Payroll Protection Program.

LONG ISLAND (WABC) -- Small business owners across the area have been struggling with the Payroll Protection Program (PPP), whether it be navigating through the complicated application and getting rejected without reason, to waiting weeks for the money to arrive with no communication from the lender.

William Gordon of Long Island Boat Rentals in Port Washington said when he first applied to the PPP he was rejected, but the lender didn't explain why.

"It was extremely difficult, you couldn't get advice," he said.

Alan Gaspin, who owns Gemini Deli, said he applied for the PPP April 8 and his bank, Chase, just notified him Monday -- almost four weeks later -- the money is on its way.

"It's been very frustrating to say the least," Gaspin said.

Neil Seiden of Asset Enhancement Solutions, based in Uniondale, has helped more than 400 business owners, like Gordon, navigate their way through the PPP.

"This is new to everybody, there's a lot of terminology people don't understand," Seiden said.

Federal officials said Sunday half of the $310 billion funneled into the most recent round of PPP loans has been exhausted. It's expected the money will be depleted by the end of the week.

Large corporations, who have relationships with private bankers, gobbled up the first round of PPP loans, forcing the federal government to put more money into the program for small businesses.

"A lot of small businesses have depository relationship with a bank, they have a checking account, but they're now learning that doesn't really qualify as a relationship," Seiden explained.

Seiden said the first PPP application was geared toward large corporations and asked for documents which small businesses would not have. The current application has fixed some of those issues.

Seiden said small business owners should have all their documentation in order before applying.

"Better to prepare, than to rush and have an incomplete application because it will get terminated," he said.

Seiden said business owners should only upload pertinent documents.

"Instead of overwhelming the lender with information that's not required, they should really follow the specific application and only upload that which is required; otherwise, we've found that if the wrong information is uploaded it only complicates things," he said.

Gaspin said while he's looking forward to getting his PPP money, it isn't a lifesaver. Seventy-five percent of the loan money must go toward payroll.

"Our rent continues, our utilities continue, even though some of it may be deferred, we're going to have to pay that," he said.

Gaspin said the government should create a Business Protection Program.