Some Small Colorado Businesses Frustrated Over PPP Loan Process
WINDSOR, Colo. (CBS4) - For Scott Romme and his Windsor-based construction company, this spring and summer looked promising.
"It was looking to be our best year ye,", said Romme, who started Trident Construction in 2003. He had a full slate of projects booked through this summer and said his staff of about 15 would be busy.
That all changed with the COVID-19 pandemic.
"We went immediately from full time, overtime and a lot of projects to absolutely nothing overnight," he said.
Facing unemployment, Romme said most of his employees sought other work, but in a bid to keep two key employees working and keep his doors open, Romme applied for a $24,000 Paycheck Protection Program loan in April.
He says he is still waiting and has not received any money from the Small Business Administration.
"For our small company, we're out of gas. We're done," lamented Romme.
His frustration has been echoed by other "mom and pop" businesses in Colorado which applied for – but did not receive - PPP funding.
Sandra Watts told CBS4 she applied for one of the forgivable government loans to try to reopen her Denver nightclub, Live at Jacks, but never got any money either.
"I got an email back that I did apply, but it just wasn't in the cards," said Watts. "I don't have the money to move forward."
Although the program initially granted more than 1,661,000 loans totaling more than $342 billion, and a second round of funding provided another $310 billion, some small business owners in Colorado like Romme and Watts can't understand why they got shut out while much larger, publicly-traded companies in Colorado saw their loan applications approved.
According to a database compiled by FactSquared, The OneGroup Hospitality Inc., a Denver-based restaurant company which operates 55 STK restaurants and Kona Grill restaurants around the country received a loan of $18,300,000.
A spokesperson for the company told CBS4, "The Paycheck Protection Program loans are necessary to support ongoing operations and will be used to help bring back our workforce. Because the company is a nano-cap public company with limited public float and trading, it has limited access to equity and debt capital markets compared to other public companies. The company also has restrictions under its existing credit facility that limit its ability to borrow, raise equity or take on additional debt."
Lifeloc Technologies, a Wheat Ridge-based breathalyzer manufacturer, received a loan of $465,000. Dr. Wayne Willkomm, President and CEO, said that has allowed the company to keep all of its 36 employees on the job.
"The PPP has made the difference," said Willkomm. He said the company applied for a loan at the start of April, but did not receive a loan in the first round, but was approved in the second round. Its loan was funded about a month after the initial application.
"Lifeloc, like most small Colorado companies, has been strongly impacted by the pandemic. However, we believe the PPP Loan will help us continue to support our 36 workers and keep good manufacturing jobs here in the US," said Willkomm.
The FactSquared database shows 13 Colorado companies receiving loans larger than $1,000,000. A nationwide hotel chain based in Colorado received a loan of more than $4 million.
A nationwide restaurant chain based in Lakewood was granted a loan of more than $11 million. An oilfield services company based in Denver secured a loan of just under $2 million.
For small business owners like Scott Romme, he is left wondering why his company is on the outside looking in. He suspects banks are more interested in processing larger loans for their bigger customers.
"It was only $24,000 in the grand scheme of things. It's an absolute drop in the hat. It's a little disheartening to hear a lot of big companies snatched up those dollars right away and nothing was put aside for the smaller companies.
"It's really frustrating and puts us in a position where I wonder if we are going to be able to come out ahead in the end."
