Deadlines loom on ‘once-in-a-lifetime’ Paycheck Protection loan program

“Don’t take it for granted. Someone else will take the money.”

Advocates of the federal Paycheck Protection Program (PPP) have a simple but urgent message: Time is of the essence.

“These loans are about ready to expire,” U.S. Rep. Mike Turner, R-Dayton, said in a virtual press conference Wednesday, a warning echoed by local business and banking leaders who joined him in the online meeting.

“Don’t assume you don’t qualify, and don’t assume it’s hard,” said Shon Myers, president and chief executive of Farmers & Merchants Bank.

Farmers & Merchants has processed PPP loans as small as $3,000 — which can go “a long way” for a small business, he said.

The process has become “really simple,” Myers added. “You can have your money in two to three days. It’s not a long drawn-out process.”

For qualifying businesses, this is money that can be used to meet payroll and other business expenses — and new deadlines to apply are approaching quickly. Small businesses and non-profits with fewer than 20 employees and sole proprietors can apply for second draw PPP loans through March 9.

The program remains open to all eligible entities from March 10 through March 31.

Sole proprietors can use PPP money to pay themselves, and the hallmark of the program is “an easy forgiveness process.”

“Don’t take it for granted,” said Jeff Hoagland, president and CEO of the Dayton Development Coalition. “Someone else will take the money.”

Turner said his congressional office has assisted more than 200 small businesses, with more than $800 million in loans having gone to Dayton-area businesses since the PPP project’s inception. It is possible to reach the $1 billion benchmark for Dayton-area businesses, he believes.

The loans “have assisted in preserving over 35,000 jobs in our community, and there are still monies available,” Turner said.

If local businesses don’t apply, then the Dayton area will likely lose the money, he and others warned. The money gets frozen or it will be spent elsewhere, the congressman said.

Maggie Ference, senior vice president and Small Business Administration director at Huntington National Bank, said the PPP program is not a “normal loan process.”

“There are no guarantors,” Ference said. “There is not an expectation for collateral support. There is no analysis for capacity for repayment. Don’t be concerned with your credit score heading into this opportunity.”

Applicants don’t need a business relationship with a bank to get started, she also said. Business payroll dictates the loan amount, but funds can also be used for other reasons — mortgages, rent, utilities and other operational expenses.

Said Ference: “This is a truly once-in-a-lifetime opportunity to get access to these funds.”

Hoagland noted that the unemployment rate in the Dayton area has fallen from about 14% at the height of the COVID crisis to closer to 5% today. “We need to keep that momentum going.”

“To our companies, if you’re thinking about it, please reach out to your bank, please give them call,” Hoagland added.

Pavan Parikh, legislative counsel and assistant vice president at Federal Home Loan Bank of Cincinnati, said the money is directed to businesses “who quite frankly are the lifeblood of the American economy.”

“When you look at the process of the PPP program, the federal government has recognized that we need the private financial sector to keep our economy moving forward,” he said.

The Paycheck Protection Program was first established by the CARES act to provide forgivable loans to small businesses impacted by coronavirus shutdowns.

The program has also been funded through subsequent coronavirus relief legislation, Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA). Turner voted for those pieces of legislation.

Turner said an extension of the program appears unlikely.

“Our advice to those sitting on the fence is apply now before the March 31 deadline,” said J.T. Thurston, spokesman for the Ohio Bankers League. “We do not know what the future holds and it remains uncertain whether there will be any further extensions to the program.”

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