Nearly 16,000 Hawaii businesses have benefited so far this year from potentially forgivable federal loans aimed at maintaining jobs amid the coronavirus pandemic.
The U.S. Small Business Administration reported that 15,819 Hawaii businesses received $1.26 billion as of Sunday from the second Paycheck Protection Program approved by Congress in December.
Last year, 25,097 Hawaii businesses received $2.48 billion in the first version of PPP, which began in April with a quickly exhausted $349 billion, followed by another $310 bil- lion that constituted the program’s first round, which expired in August.
The second round was funded with $284 billion, and an original March 31 deadline was recently extended to May 31.
Applications can still be submitted through local lenders contracted to process applications for SBA.
The Hawaii Bankers Association estimates that 310,000 jobs statewide have been supported by PPP to date, including 170,000 in the first round and 140,000 in the second round.
Rich Wacker, the trade organization’s president, who is also president and CEO of American Savings Bank, said the second round of PPP loans is helping the hardest-hit companies in Hawaii stay afloat while paying employees.
“The recent extension of the PPP deadline to May 31 will allow even more local businesses to receive much-needed support, moving our state further on the path to recovery,” he said in a statement.
PPP loans are designed to primarily pay for payroll but also allow some proceeds to be used for other expenses, including rent, mortgage payments and utilities.
The program’s second round was geared more to smaller businesses and offered loans up to $2 million, compared with up to $10 million in the first round. Some businesses that received loans in the first round also could qualify for a second loan, though criteria to qualify were more limited.
For instance, Love’s Bakery, which received an initial $2.8 million PPP loan last year, said it couldn’t obtain a second draw. The company closed last week after nearly 170 years in business, ending jobs for 231 employees.
PPP’s second round included a 14-day exclusive application period for businesses, including nonprofit organizations with fewer than 20 employees.
Nationally, 4 million PPP loans had been made this year through Sunday for $224 billion of the $284 billion available, according to SBA data. Most loans were second draws totaling $187 billion, compared with $37 billion in first-draw loans.