President Trump recently approved changes to the Paycheck Protection Program to give small business owners more opportunities to qualify for loan forgiveness. Some owners say even with the changes, it’s still a long process to get their PPP loan forgiven.
Gail Lindley is the 3rd generation in her family to run the Denver Bookbinding Company.
“It’s more than a business, it’s truly our life blood,” Lindley said.
The 91-year-old company received a Paycheck Protection Program loan that helped Lindley keep the lights on and employees working on the limited orders coming in.
Now, Lindley is worried about the extensive requirements to make sure her loan is forgiven.
“The bank told us, ‘You really need to document well,’” said Lindley.
The PPP loan forgiveness application is 11 pages long and requires companies to document all spending on payroll, rent and utilities. Changes to the act were signed into law by President Trump on June 5. Companies must still prove they’ve retained workers and kept wages the same to earn full loan forgiveness.
Consumer Bankers Association CEO, Richard Hunt, said documenting this is an unnecessary burden for small business owners.
“Right now, small businesses across the country are spending about $2,000 more more and 15 more hours submitting another application packet,” said Hunt. “We’re saying, just forgive all the loans under $150,000,” he said.
Lindley believes automatic forgiveness would help people get back to work more quickly.
“There’s only so many hours in a day, and I want to spend it working on my business not filling out forms,” she said.
The Small Business Administration is requiring the most documentation for businesses who want full forgiveness. With the changes President Trump approved, businesses have 24 weeks instead of just eight weeks to use the funding—and only 60% of the loan needs to be used for payroll instead of the original 75%.
“We can make that money last a little bit longer and be more thoughtful on how that’s doled out,” said Lindley.
These changes are helping many, but Hunt said more needs to be done to lift time-consuming burdens off small businesses just getting back to work.
“$150,000 or less constitutes 85% of all loans, but only 20% of all the funding, so those larger businesses would still have to submit a forgiveness process, but not the mom and pop shops who are still in the red right now trying to make ends meet,” he said.
For Lindley, she’s just hoping all the bookkeeping she’s done will be enough to keep her family’s story alive.