Small business owners gear up for another go at anxiety-inducing stimulus loans

Millions of small business owners found renewed hope on Friday, after three weeks of waiting for some positive news, as the president signed another $310 billion over to the depleted Paycheck Protection Program, a loan program intended to buoy local businesses around the country for eight weeks.

But for many small business owners, that glimmer of hope was quickly tapered by a reminder of their own experiences. After weeks of wringing their options dry as they tried to secure a loan at the same time as 1.6 million other companies, many eventually lost the race against time and watched the $349 billion program dry up.

On Monday morning, the Small Business Administration will again start to accept applications for PPP loans, which can be forgiven after eight weeks as long as businesses use the money to keep employees on payroll and pay utilities.

This time around, experts say the $310 billion is expected to run out even quicker than before, as nearly 1 million applications sit idle, having missed out on the last round.

Nick Ponton, who owns a fashion production company in Manhattan, is one of the million.

Most of his business is fashion shows and photo shoots, neither of which are happening at the moment. Instead, Ponton has linked up with others in the fashion industry to make and deliver cloth masks to hospitals.

It's helped to keep his mind off of PPP, he said, and to remind him what others are going through on the front lines. But time is running out for his business.

If he doesn't receive a loan by May 1, he plans to furlough himself and his one employee.

Whatever "gas is left in the tank" will go toward his employee's health insurance, he said, adding, "I'm not going to leave her without health insurance during a pandemic."

For much of the last month, Ponton has searched high and low to find a bank that would process his application. He initially went to his own bank, Bank of America, but was told they were only able to review applications from customers that already had lines of credit open.

The experience left him furious, Ponton said.

"We have played by the rules for a decade and the once in a million times that we need this ... you're told that your healthy business can't be serviced, because they're only giving money to people that owe them money," Ponton said.

Then, after watching billions of dollars drain from the program every day, Ponton tried something new -- something he doesn't, in hindsight, recommend.

"That desperation, or that sense of urgency, is why I found myself having sent my tax returns and confidential financial information to a bank I'd never heard of, in Florida, over the internet, via a recommendation on Twitter," Ponton said.

He panicked, eventually pulling his application, and finally successfully submitted another application with First Republic, a smaller bank that caters to a high-income clientele. On Friday, he got assigned a number in the queue: 361,426.

Still, Ponton feels lucky. As a middle-aged white male, he acknowledged that he likely has had a far easier time than minority-owned businesses, women-owned businesses or businesses run by non-English speakers -- all of which statistically have less capital and face systemic challenges.

"It just made me realize there are so many other small businesses who need this help who don't have access to the system to get it," Ponton said.

Ponton is relatively lucky despite not actually receiving any financial help from the government just yet.

Others, like Brooklyn, New York, restaurant owners Debbie and Kevin Adey, have waited about two weeks without any word from their bank, Chase.

Kevin, the chef at their Italian restaurant, Faro, and Debbie, who runs the business side, opened up shop five years ago -- their first restaurant together. They let go of their entire staff of 26 on March 16, when New York City shut down all of its bars and restaurants.

Some of their employees have since left the city, the Adeys said. Many are on unemployment. For others, it's worse. Some aren't responding, perhaps because they're no longer able to afford to pay their phone bills, Debbie said.

"Unfortunately, I had somebody ask me to sleep in the restaurant," she said. She wasn't able to say yes.

"I just can't get involved in that, you know? It breaks my heart, but I just can't go there," she said. "But that's tough. That weighs heavy, they're like family."

As they wait, the Adeys find it hard to see how a "new normal" will work for the restaurant industry. So far, it's been that fear of the unknown that has kept the Adey's from trying curbside pick-up or delivery, they said.

"It's so easy to infect other people, even if you're not showing symptoms. I just can't imagine trying to explain to somebody's kid [who got infected] -- it was what I had to do, you know, we had to go in and make the pasta," Kevin Adey said.

On the other side of Manhattan, Andrew Zebrowski has felt the reverberations from the hits taken by his colleagues in the restaurant industry. For Zebrowski, a co-founder of the two-year-old Hoboken Brewing Company, they're his biggest clients.

He estimated his company is currently making about 15% of the profits it made last year. These days, Hoboken Brewing has pivoted to selling their beer from a local bar that's turned itself into an adult lemonade stand, selling outside from a street-facing garage.

"We did everything promptly, right away. Got everything in correctly, done. Triple checked it, crossed all the T's dotted the I's," Zebrowski said of their loan application. "We find ourselves checking every morning, but nothing yet."

He doesn't know any other small business owners who have received the PPP loan, and said his own business can't go on much longer without dipping into their own bank accounts to pay the bills -- a harrowing prospect for Zebrowski, who has a 1 1/2-year-old and a 9-week-old baby.

But that's also given him plenty of reasons to be grateful for.

"I am trying to stay positive," he said. "I know people have it worse."