Tennessee small businesses were able to access federal Paycheck Protection Program loans in the second round of disbursements, but many businesses still are struggling to earn money since they can operate only at a limited capacity.
Businesses struggled to get loans in the first round of PPP because banks faced delays in being approved as lenders by the U.S. Small Business Administration (SBA), some businesses made mistakes on paperwork and the fund ran out of money.
However, as lenders continued to get approved, that problem eased and businesses no longer are having trouble getting approval, Jim Brown, the Tennessee director of the National Federation of Independent Business, told The Center Square.
Brown said there likely are some independent contractors and self-employed workers who don’t know they’re eligible.
Through Saturday, Tennessee businesses had received about $8.84 billion in 82,768 PPP loans. The state had received $6.54 billion in round one funding through 34,035 loans.
SBA has loaned out nearly $195.2 billion of the $310 billion that was approved by Congress in the replenished PPP fund. LaTanya Channel, the director of the SBA’s Tennessee office, told The Center Square that if any business is struggling to receive loans, they can contact the SBA’s Tennessee district office.
The PPP loans can be forgiven if they are used for payroll costs, existing interest payments on mortgages, rent payments, leases and utility agreements. Although the money can be used for other expenses, those other expenses would not be forgiven.
Although these loans are helping some businesses stay afloat, Brown said many businesses still are struggling to make ends meet under current government restrictions. Most businesses throughout Tennessee are able to operate at limited capacity during phase one of reopening and many are forced to operate at 50 percent capacity.
“Tennessee has begun to reopen, but there are still restrictions in place, and consumer confidence will probably be an issue for some time until people are comfortable to get back out there,” Brown said. “Getting everyone back to work will take time.”
Gov. Bill Lee intends to lift capacity restrictions beginning May 22 and shift its focus on social distancing guidelines.
