Almost one-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 in the country. 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 for struggling small businesses, 32.3% of the money that went to Oregon ended up in the hands of large companies receiving loans between $ 1 million and $ 10 million. of dollars.
Economists say the program has largely 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, who accepted $ 5 million from the program last spring. The Trump administration then released indications that the loans were not intended for companies with access to the stock market, but Digimarc was not excused, 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. (See a full list of the Top 25 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 received large loans included restaurant chain Old Spaghetti Factory ($ 9.2 million), Pendleton Woolen Mills (loan of $ 8.7 million), nonprofit 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 Donut received $ 1.8 million.
Sentia Wellness, parent of Portland-based cannabidiol maker struggling Social CBD, accepted nearly $ 2 million.
Seneca Sawmill Co. received a loan of more than $ 7 million under the program, but announced Thursday that it has repaid the loan with interest following a recovery in the lumber market.
And then there is Shilo Management.
The government provided $ 2.98 million to the Shilo motel chain and the entrepreneur behind it, Mark Hemstreet. Shilo has a written record of lawsuits, bankruptcies and foreclosures dating back a decade. 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. It was about keeping companies 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 has all but come to a halt.
But for Hemstreet and Shilo Management, their financial bottleneck dates back a decade or more, a time that includes multiple lawsuits, bankruptcy, multiple hotel property foreclosures and a litany of other issues.
In the most recent lawsuit, Cathay obtained a garnishment order against Shilo Management and Hemstreet that will give the bank the ability to access their bank accounts.
Hemstreet’s lawyers 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 deviate 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 state’s second-largest company, raised more than $ 7.8 million, by far the highest amount of any local company. Miller Nash Graham & Dunn borrowed $ 4.9 million.
Did these posh 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 been successful in “keeping 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, the firm’s co-managing partner in Portland, confirmed that she had not applied for a loan.
“Instead, we have chosen to manage 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 saw our business perform well and recently we restored full compensation to all of our lawyers and staff leaving them free for the year.”
In a truly terrible year for the restaurant and bar industry, beer lovers can take comfort 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 get the maximum of $ 10 million. The company, now more of a hotel and hostel operator than a simple brewer, briefly shut down all of its operations in the Northwest at the start of the pandemic.
Other notable borrowers include Deschutes Brewery, which borrowed $ 5.9 million; Ninkasi to Eugene, who borrowed $ 1.2 million; and Portland’s must-see Breakside Brewery, which received $ 763,700.
The vast majority of Oregon’s loans have gone to smaller businesses asking for well under $ 1 million. A total of 31,435 loans, or nearly 48% of loans to organizations in Oregon, were less than $ 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 all industries during the pandemic, ranked sixth among industries receiving money, absorbing 8.8% of the Oregon allowance.
The Paycheque Protection Program was designed to help small businesses keep their employees on the 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 nationwide.
The program has drawn criticism for a random rollout that authorized fraudsters for accessing tens of millions of dollars in loans; and for making multi-million dollar loans to large established businesses when aid was supposed to be directed to struggling small businesses.
New data released on Wednesday showed a quarter of money distributed nationwide went to 1% of borrowers, analysis found by the New York Times. About 600 companies nationwide have received the maximum loan amount of $ 10 million.
The Small Business Administration previously provided loan lines 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 lawsuit brought by 11 media outlets.
– Jeff Manning; 971-263-5164; [email protected]