Local gym says they’re facing challenges using PPP loan
CAPITAL REGION, N.Y. (NEWS10) — Many small businesses facing shutdowns because of the pandemic have sought some relief through the federal Paycheck Protection Program, or PPP. Best Fitness says they’re facing challenges deciding how to make the best use of that loan.
The Small Business Administration says the goal of the Paycheck Protection Program is to get employees back on payroll, earning their salary through forgivable loans that are guaranteed by the federal government, while also keeping workers off state unemployment rolls.
“Congress wanted it designed so that the money would go to employees at small businesses during this shutdown period,” says SBA Regional Administrator Steve Bulger.
However, Andy Marino, C.O.O. of Best Fitness, which has locations in three states, including the Capital Region, says about half their employees are part-time, and right now, those workers are making more money collecting unemployment than they would if they were brought back on payroll.
In order to get 100 percent forgiveness on the loan, the business has to make sure at least 75 percent of it goes to employees. Marino says that “makes sense on paper,” but feels the time frame–in which they must begin the 8 week period to use the loan–puts them in a tough spot.
“We would need to pull all of our staff off of unemployment to pay them for an eight week period, and then once that eight week period concludes, they would all need to go back on unemployment,” Marino tells News10, “and at that point they may not have that extra $600 available to them. We feel that that would be really unfair to our team, particularly our part-time team members that were only working 15 to 20 hours a week.”
Marino says the company wishes they 8 weeks could begin from the time they reopen.
But according to Bulger from the SBA, that money is meant to help employees now. He acknowledges how unprecedented it was for all these businesses to close overnight, so he understands the frustration among business owners.
“No one was ready for that on any level. We’ve never faced it as a nation,” Bulger says, “so it has been a huge challenge, and we’re trying to get the resources out to our small businesses.”
There are still over $100 billion in funds available for the Paycheck Protection Program. Applications are due June 30.