The Paycheck Protection Program was first unveiled as part of the CARES Act last March as a way to help affected businesses get through the initial stages of the COVID-19 pandemic.
Within two weeks of the program’s start, the $349 billion was exhausted, prompting a second round of PPP loans totaling $320 billion to become available. In December, funding for a third round added $284 billion to the program. In all, $800 billion was disbursed across more than 11.8 million loans to small businesses in the United States. In New Hampshire, 16,617 loans were approved during the three rounds according to data compiled by the Small Business Administration totaling more than $1.15 billion.
Roedel Companies in Wilton, which owns and operates 10 hotel properties in New Hampshire and other New England states, as well as New York and Florida, was one of the many local companies to receive funding through the Paycheck Protection Program and something Chief Financial Officer Fred Roedel III said “I think for an awful lot of companies, including ourselves, it saved us.”
“We were hammered,” he said. “And we used this as one of the tools to get us through it. To have a business for people to come back to.”
Roedel said in a span of two weeks last spring, the company went from 550 employees to 85 and described the effect of the pandemic on the hotel and hospitality industry as devastating. They had to close three of their hotels completely for three months and for the others, business slowed down significantly.
“I don’t think people appreciate the speed and the impact,” the pandemic changed things, Roedel said.
Roedel called the PPP loans as well intentioned and certainly beneficial and was impressed with the speed at which the program was rolled out. The company took out eight loans in the first round and another eight in the second distribution. Six of the initial loans have been forgiven, Roedel said, while they still await word on the final two. He said over the last four weeks he has started the process for forgiveness for the second round loans.
The main issue is that the parameters of the loan forgiveness process have changed, making it at times hard to navigate what will be forgiven. He said some of the funds were used for things like debt services, insurance and taxes, out of a need to survive.
“So now we’re dealing with some details and some questions,” he said. “But we saved our company, we got through this so if we have to pay them back so be it.”
Roedel said the loans were crucial at the time and business still hasn’t returned to what it was pre-COVID-19.
“I project the business community to start returning to travel in the third or fourth quarter,” Roedel said.
He said they are getting back to being self-sustaining, “but it was important to get through this.” As of now, Roedel said they have returned to an employee level in the low 400s, and part of that is due to the difficulty in hiring employees.
Philip Himberg, executive director of MacDowell, said the decision to apply for a PPP loan came early on and at a time when he was dealing with the effects of his COVID-19 diagnosis.
The mission to keep MacDowell’s employees employed during the uncertainty of the pandemic was the sole reason behind applying for the loan.
“And it was purposed for exactly what the PPP loan was meant to do,” Himberg said. “It provided the ability to keep our folks working.”
Himberg said the $433,800 loan has been forgiven and it did what it was meant to, as MacDowell was able to keep everyone employed until they got back up and running in the fall.
“We felt our application was exactly within the guidelines,” Himberg said. “So we felt pretty confident we have applied in good faith and used it in good faith.”
The loan didn’t cover all the costs of employee salaries, but it did enough. The idea was to put human capital in front of money, Himberg said.
“It wasn’t total budget relief, but it significantly helped,” Himberg said. “Because if we had laid people off, we wouldn’t have been able to get ready to reopen when we did. So it was about investing in the mission and the future.”