SBA failed but the City of Solvang is launching another loan package for Solvang businesses!
By Solvang Journal Staff Report
The City of Solvang is launching another loan package for Solvang businesses
Due to the disappointing lack of funding of the Small Business SBA’s Paycheck Protection Program (PPP), the City of Solvang is stepping up to create the City’s own PPP Loan Program to help Solvang’s Businesses.
The SBA’s PPP is out of money, leaving Solvang’s small business owners facing an uncertain fate. It seems the SBA’s PPP Loan did not reach any Solvang Small business community at all.
Upon hearing of these latest developments, the City of Solvang is looking to create a second loan package in greater amounts for Solvang’s small business community.
To date, the City of Solvang’s Emergency $5K Emergency Loan Assistance Program remains the only program aiding Solvang businesses. Funded with $250,000, this program allowed for Solvang’s small businesses suffering COVID-19-related losses, to apply for a $5,000 loan. The response was overwhelming, and in just two weeks, City staff processed 50 loan applications. The approved funding was always meant to be a lifeline to local businesses as they waited for other funding applications to be processed – such as the SBA loans and other Economic Injury Disaster Loans (EIDL). As of Monday night’s Council meeting, loan requests under this program were continuing to roll into the City, showing there is still a great need.
According to Solvang Mayor Ryan Toussaint’s public message, the Solvang City Council authorized the City Manager to enter into an agreement with the National Development Center (NDC), a nation-wide nonprofit loan organization, to explore lending opportunities which would best serve the community of Solvang.
According to city officials, NDC will aid the City in designing either a City-run PPP for business stabilization and/or local Revolving Loan Funds (RLF) for business recovery, once the point of recovery has been reached. Other lending options will also be considered.
Solvang Retailers Association (SRA) urged and supported the idea of creating Solvang’s own PPP program by the City of Solvang.
According to the SRA’s public statement: “We are very disappointed by SBA. Companies that are absolutely not small businesses are getting millions of dollars in the name of small business loans. We strongly protest the response from SBA, given they’ve stopped accepting applications because the approved funds have run dry. The national, state and county level politicians have made promises, but we’ve yet to receive any follow-through.
Solvang is facing its own second economical disaster in the last two years, the first of which occurred during the 2018 Highway 101 closure disaster. During that time only a few selected businesses were funded, most of the larger corporations. However, Solvang is a unique town in that no national or state level franchised businesses exist here, and the town is instead filled with mostly independently-owned mom & pop-type small businesses. We continue to receive only empty promises, while large corporations reap the benefits! The Federal government should have paid the lenders per application – from smallest to the larger size – rather than a percentage from the given loan putting all the smaller at the bottom of the pile.
Small businesses should not be considered more than a max of 30 employees, with a max of $5 million in yearly turnovers! Don’t put small businesses and multi-million dollar companies in the same pot! The Treasury Department should give grants directly to the real small business owners based on their tax returns gross income.