PHOENIX — Two of the loans created by the federal CARES Act to help small businesses get through the coronavirus pandemic have run out of money. The Small Business Administration announced Thursday that both the Payment Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) have capped out.
The SBA has closed applications for both loans, saying the administration and the US Treasury have asked Congress to allocate more funds for the programs.
The loans were part of the $2.2 trillion coronavirus relief package President Donald Trump signed into law on March 27. Congress allocated $349 billion for the Payment Protection Program and $10 billion for the EIDL.
The PPP loan was distributed by SBA-approved lenders in a first come, first saved bases. It's designed to cover eight weeks of a business' payroll expenses, so the company can retain its workers or hire back those it may have already furloughed. The loans are forgivable provided that 75% of the total amount borrowed is used for payroll expenses.
The SBA released data showing the average loan size is just under $240,000.
Miryam Barajas, the regional communications director for SBA, said Thursday about 19,000 small business in Arizona were approved for the PPP, totaling in $2 billion in loans. According to the Greater Phoenix Economic Council, there are more than 571,000 small businesses in Arizona.
The SBA said it gave out 14 years' worth of loans in just 14 days.
"Obviously what we had was not enough," she said. "We know that this has helped a lot of businesses to be able to stay afloat. But there's a tremendous need. We know this is critical, we know that the business community is asking for more support."
Barajas said when the PPP first opened, there were 1,800 approved lenders. Now, there are nearly 5,000 SBA-approved lenders. She said if Congress allocates more money to the program, people will have more options to apply for loans.
The process to apply and receive these emergency loans has been frustrating for many small business owners, including Brenda Laskoskie, who's owned Dei-Zinz for 35 years. Her small staff in Scottsdale makes silk florals and artificial trees.
"The sales have gone virtually to zero," she said.
Laskoskie applied for the PPP and EIDL, but hasn't received money from either. She said she applied for the PPP through her bank Arizona Bank and Trust as soon as the application opened. A week later, she was told the bank ran out of money and she should apply elsewhere. Laskoskie applied again with Enterprise Bank and Trust and was waiting when she heard that the program had run out of money.
"We don't know if we're in that process and just haven't been processed, we don't know if we'll get anything at all, we don't know if we're out completely. We have no idea," she said. "We have a lot of determination and drive here because this is our life. It has supported my family for 35 years. So we're not going to let go easy. We may have to get creative, but we are determined to make it."
The SBA encourages business owners to sign up for its newsletter to get updates on programs.
Find out more about SBA relief options here.