PPP/Emerg. Funds - My Experience

How are you all doing with this process? Thought I would give you my experience if it would help others.

I own an commercial HVAC business for over 30 years with almost (50) employees. Three weeks ago we have (71) live projects and we are now own to (4). In many cases the malls, cities, or State shut the projects down. In other situations the corporations like Gap, H&M, and Dick's shut down all retail, construction and future construction for now which shut the project down.We are down some work for Amazon and they have invoked some heavy duty restrictions which will cost us lots of additional money and time. We are down to (6) employees in the field and none in the office. We tried to keep then all working the last two weeks and we literally had people washing vans, pulling weeds, filing and cleaning but now they have zero to do. Most of my staff would rather not see me waste money while this is gong on so they have a job to return to.

So I filed for the $10K and PPPP. the $10K was with SBA and I filled online and heard nothing so far. I filed the PPP with my bank. Luckily we are a big fish in a small/mid size bank, so we were on their top 10 clients to help out. We filed within minutes of SBA opening up. So I got the call yesterday to discuss things and its not quite the way the media makes it out. I am not saying its bad, but people should know. My bank was clear the they want to be transparent and make sure people understand the severity of the loan and the seriousness of the terms.

So in my case my loan will be $750K. The clock started today not a few weeks ago. So they will look at my payroll the next 10 weeks. Based on that number, it potentially will be forgiven. Then an additional 25% can be used for rents/utilities and such which in theory will be forgiven as well. the issue at hand is the (46) employees that are sitting at home. I could rehire them all back, and pay them to sit in my break room and they get a 40 hour a week check and I get it forgiven. My intent is to hire ALL of them back as soon as my projects open up which we are hoping in 3-4 weeks. Once we open back up, our payroll will go back to normal and actually be higher as we are likely to go on OT and DT to catch jobs back up and we will use up a good chunk of that borrowed money. Of course if this goes till June or July, all bets are off.

So the issue for many businesses is, whatever money that is not forgiven, the borrower owes on an 18 month note at 1% interest! On a $150K balance that is $9K per month! Well as long as your are a responsible business owner, that is VERY cheap money. if you are not or CAN NOT, then November 1st rolls around and that will be a significant of money owed each month. At this point, you will be able to renegotiate the loans terms based on the value left and possible convert it to a longer note, but not sure the average small business owner will understand that. I talk to dozens of bankers, lawyers, business owners, and corporation daily and nobody really knows whats going on and the rules are changing every day.

This is my update as of today and that is me workign on it every day for a few weeks.