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Almost a third of the $ 7 billion Oregon businesses received under the Paycheck Protection Program went to 1,054 businesses, which make up just 1.6% of loan recipients. State, according to data released this week by the Small Business Administration.
A total of 66,100 Oregon businesses received potentially repayable loans under the coronavirus relief program, with an average loan of $ 106,692.11. It is not yet known how many of these loans will eventually be canceled.
But even though the federal program was supposed to be focused on struggling small businesses, 32.3% of the money that went to Oregon ended up in the hands of large companies receiving loans of $ 1 million to $ 10 million. of dollars.
Economists say the program has broadly served its purpose, transferring money from public coffers to private companies and nonprofits so they can keep their workers employed during the early days of the coronavirus recession.
Critics, however, complained that too much money had gone to companies run by well-connected politicians and owned by wealthy businessmen who had other means of funding their organizations.
A number of publicly traded companies have also received funding, including Oregon-based Digimarc, which accepted $ 5 million from the program last spring. The Trump administration later released indications that the loans were not intended for companies with access to the stock market, but Digimarc was without excuse, saying it was using most of the money for payroll, the designated purpose of the loans.
The Oregon companies that received the most money came from a wide variety of industries.
Six Oregon companies have been approved for the maximum loan size of $ 10 million: Erickson Air Crane, Pacific Office Automation, Swanson Group Manufacturing, Timber Products Co., McMenamins and Shari’s Restaurant. (Check out the full Top 25 list at the bottom of this article.)
Fifty-three Oregon companies received loans over $ 5 million, while 20 received loans over $ 7 million.
The long list of loan recipients reads like an Oregon business directory. Almost all types of organizations, from all parts of the state, participated in the relief program.
Notables who have received large loans include restaurant chain Old Spaghetti Factory ($ 9.2 million), Pendleton Woolen Mills (loan of $ 8.7 million), non-profit Mercy Corps ( $ 7.6 million) and the artisanal Salt & Straw ice cream maker ($ 4.5 million).
Powell’s Books received a loan of $ 4.1 million, Timberline Lodge received $ 2.7 million and Voodoo Donuts received $ 1.8 million.
Sentia Wellness, parent of Portland-based cannabidiol maker Social CBD, has accepted nearly $ 2 million.
Seneca Sawmill Co. received a loan of more than $ 7 million under the program, but said Thursday it has repaid the loan with interest following the recovery in the lumber market.
And then there is Shilo Management.
The government paid $ 2.98 million to the Shilo chain of motels and the entrepreneur behind it, Mark Hemstreet. Shilo has a decade-long record of lawsuits, bankruptcies and foreclosures from lenders. Days after the PPP loan closed, Cathay Bank filed a new lawsuit against Hemstreet and Shilo, claiming they were in arrears on a $ 4.1 million loan.
Obviously, PPP loans were not normal transactions. The goal was to keep businesses alive and employees employed.
And it is undeniable that the hospitality sector has been brutalized by the pandemic. Hotels around the world have closed or ceased operations altogether as travel is virtually halted.
But for Hemstreet and Shilo Management, their financial bottleneck dates back a decade or more, a time that includes multiple lawsuits, bankruptcy, multiple hotel foreclosures and a litany of other issues.
In the most recent lawsuit, Cathay obtained a garnishee summons against Shilo Management and Hemstreet which will give the bank the ability to access their bank accounts.
Hemstreet’s attorneys said he declined to comment.
In court documents, Hemstreet claimed that the bank’s “unwarranted” efforts to obtain reimbursement may have been “motivated by unlawful discrimination” against it and “certainly deviated from commercially reasonable conduct”.
Lawyers may not be the first group you think of when the topic is emergency pandemic aid. But many Portland businesses – at least 15 – have applied for and received a P3 loan.
Schwabe, Williamson & Wyatt, the second-largest company in the state, raised more than $ 7.8 million, by far the largest amount of any local company. Miller Nash Graham & Dunn borrowed $ 4.9 million.
Did these fancy business companies really need federal money?
Graciela Gomez Cowger, CEO of Schwabe, said it saved jobs at her company. Along with cost-cutting measures including “significant pay cuts” for lawyers and senior executives, Schwabe has managed to “keep our team employed during this unprecedented time.”
Stoel Rives, the city’s largest company, stood out for its absence from the list of PPP beneficiaries. Penny Serrurier, co-manager of the company in Portland, confirmed that she had not applied for a loan.
“Instead, we have chosen to work on the financial impact of the pandemic by taking other measures, including reducing our overhead while minimizing the impact on our employees,” she said. “As the year progressed we have seen our business hold up well and recently we have restored full compensation to all of our lawyers and staff making them full for the year.
In a truly horrible year for the restaurant and bar industry, beer lovers can find solace in the PPP spreadsheet. Craft brewers, large and small, borrowed money from the federal program.
McMenamins was one of the few borrowers in Oregon to raise the maximum of $ 10 million. The company, now more of a hotel and hostel operator than a simple brewer, briefly ended all operations in the Northwest at the start of the pandemic.
Other notable borrowers include the Deschutes brewery, which borrowed $ 5.9 million; Ninkasi to Eugene, who borrowed $ 1.2 million; and the Portland Breakside Brewery mainstay, which received $ 763,700.
The vast majority of Oregon’s loans have gone to small businesses asking for well under $ 1 million. A total of 31,435 loans, or nearly 48% of loans made to organizations in Oregon, were under $ 25,000.
Oregon companies in the health care and social assistance sector received 13.5% of the money, while construction companies received 13.1%. The hospitality industry, which was arguably the hardest hit of any industry during the pandemic, ranked sixth among industries receiving money, with 8.8% of the Oregon allowance.
The Paycheque Protection Program was designed to help small businesses keep their employees on their payroll for several months in the midst of the pandemic. The program stopped accepting applications in August after distributing $ 525 billion in potentially repayable loans to 5.2 million businesses across the country.
The program has drawn criticism for a haphazard rollout that gave fraudsters access to tens of millions of dollars in loans and for granting multi-million dollar loans to large, established businesses while aid was supposed to be aimed at small businesses in difficulty.
New data released Wednesday showed that a quarter of money distributed nationally went to 1% of borrowers, according to New York Times analysis. About 600 companies nationwide have received the maximum loan amount of $ 10 million.
The Small Business Administration previously provided loan brackets and the names of companies that received more than $ 150,000 in aid, but on Wednesday released the names and exact loan amounts for the 5.2 million borrowers after a trial of 11 new organizations.
– Jamie Goldberg | [email protected] | @jamiebgoldberg
– Jeff Manning; 971-263-5164; [email protected]
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