Thousands of businesses in central Austin received hundreds of millions of dollars in PPP loans to survive pandemic
The YMCA of Greater Austin was one of thousands of entities in Austin to receive a loan under the Payroll Protection Program. Statewide, more than $ 40 billion has been loaned to more than 382,000 beneficiaries. (Design by Shelby Savage / Community Impact Newspaper)
The YMCA of Greater Austin reopened most of its locations on June 1. After a 10-week closure, the Y welcomed members to its pools and fitness centers under new safety guidelines, while opening in-person day camps this summer for parents who had to return to work. .
Without a $ 2.6 million loan from the US Small Business Administration’s Wage Protection Program, Sean Doles, the Y’s vice president of Mission Advancement, said the reopening would have been very different.
“We would have had a reduced staff. We would have had minimal services – a lot of the services the community depends on us to provide, ”Doles said.
According to data released by the SBA on July 6, this $ 2.6 million loan to the Y helped retain 168 of the organization’s more than 700 employees. The vast majority of those 700 employees, Doles said, are part-time and occupy positions ranging from fitness class instructors to childcare providers to hostesses at the front desk.
When the income did not come from sources such as swimming lessons, fitness classes and day camps during the shutdown, he said the Y faced “existential challenges” that would have threatened those jobs this spring without the PPP.
Another Austin-based nonprofit, We Are Blood, faced an equally precarious situation before receiving their PPP loan. We Are Blood is the exclusive supplier of blood and platelets to hospitals in the 10-county area of central Texas, and when Governor Greg Abbott suspended elective surgeries in March, the financial woes of these local hospitals also spread. at We Are Blood.
On April 5, We Are Blood received approval for a PPP loan of just over $ 2 million, which has helped the nonprofit stay at its current level of 156 employees, according to Nick Canedo, Vice President of Community Engagement.
The loan, Canedo said, helped We Are Blood keep the staff it needed to start a program to collect convalescent plasma from recovered COVID-19 patients. The antibodies in the plasma are then used to treat patients who are battling the virus. Canedo said We Are Blood has been able to send plasma to around 500 patients to date.
“Without our current workforce, we would not have been able to launch this program,” he said.
We Are Blood and the YMCA are two of more than 22,000 businesses, nonprofits and sole proprietorships in Austin that received a P3 loan from the SBA, according to data the federal agency released on July 6. . Loans to Austin-based businesses ranged from as low as $ 6 to $ 5-10 million.
Five downtown Austin-based companies have received PPP loans in the range of $ 5-10 million: Torchy’s Tacos, Hopdoddy Burger Bar, Alamo Drafthouse, data science platform Anaconda, and energy services company Pinnergy. But the vast majority of the 8,583 PPP loans granted to businesses in downtown Austin, or 85.1%, were under $ 150,000.
The SBA released the data on July 6 after being sued by 11 media outlets, including the Associated Press, ProPublica, the New York Times and the Washington Post, for its initial refusal to release detailed information about the loans.
John Arensmeyer, CEO of the national small business advocacy group Small Business Majority, said in a statement that one in four small businesses in their network said they received less than they requested and the data released July 6 are “far away”. from a precise representation of the program.
Overall, there are gaping holes and inconsistencies in the information. Serious questions remain as to whether PPP funds have been fairly distributed to minority-owned businesses, and there is an alarming rate of small loans, “Arensmeyer said in the statement.
In Washington, DC, lawmakers are discussing granting another round of forgivable loans to businesses that have 100 or fewer employees and suffered a 50% or more loss of income during the pandemic.
At the local level, businesses and non-profit organizations still face significant challenges. The number of coronavirus cases and hospitalizations have increased in Travis County and the rest of the state since early June. On June 25, Abbott again postponed elective surgeries as part of the measures he put in place to suspend reopening of the state.
All of this means that We Are Blood expects more financial losses in the future, Canedo said.
At the YMCA of Greater Austin, where social distancing, improved compensation procedures and face coverings are now part of operations, Doles said business barriers resulting from the virus will exist for the foreseeable future.
“We still face an uphill struggle. As our community grapples with this, we are finding new ways to operate in the COVID-19 landscape,” he said.
Editor’s Note: This story has been updated to reflect that We Are Blood has sent plasma to 500 coronavirus patients to date.