Small business lifeline falls short. LA Lakers get a loan, but not this Tacoma salon owner

In this week’s edition of “Government as usual,” we look at the chaos swirling around the Paycheck Protection Program (PPP), two sets of federal financial packages totaling $659 billion passed by Congress to rescue small businesses shuttered by the coronavirus shutdown.

Here’s what we know: The first $349 billion of PPP went faster than candy from a busted piñata. Well-known businesses and institutions on a relatively strong footing, such as Harvard University, Ruth’s Chris Steak House and the Los Angeles Lakers, elbowed out smaller businesses and scooped up the forgivable loans.

Thanks to a little public shaming, these not-so-small businesses gave the money back. We hope a little red-faced, too, especially considering rural and minority businesses were largely excluded in the PPP’s first-come, first-funded process.

For small business owners like Natchaya Gibson, proprietor of Natchaya Salon in Tacoma, the process of applying was only the first hurdle; the second was convincing her five employees to stay on while she waited for the payroll loan.

They fared better receiving unemployment, so Gibson understood when all but one said goodbye.

Gibson epitomizes the American Dream. She grew up in Thailand, put herself through school and moved to a neighborhood near JBLM after marrying her husband, Jason, a recently retired U.S. Air Force veteran.

Together the Gibsons put their sweat and savings into a business that just celebrated its one-year anniversary.

They’ve abandoned hope when it comes to the PPP and are currently looking into Pierce County’s emergency relief loan program.

“We have to pay it back in a year,” Gibson said of the Pierce County loan. “It may take us longer to get back on our feet.”

The Gibsons are among thousands of South Sound business owners who’ve been forced to navigate a lottery system of economic relief while negotiating with lenders on existing loans.

It’s why the Tacoma-Pierce County Chamber and the Economic Development Board for Tacoma-Pierce County started the COVID-19 Info Series.

Three times a week, the Chamber and EDB host an open Zoom call where business owners can ask questions regarding government policy, financial rescue packages and what other small businesses are doing to stay afloat.

The Chamber’s rapidresponsesouthsound.com webpage also hosts an extensive FAQ page explaining packages available through the Small Business Administration.

What local economic development officials haven’t done is figure out why so many small businesses were left out of government financial rescue efforts. As EDB chief Bruce Kendall said, “There is no good way to publish a list of who got loans and who didn’t.”

At least Congress self-corrected slightly when it reserved $60 billion from the second batch of PPP allocation to pass through small and medium sized banks, community financial institutions and credit unions. That means more money, in turn, should funnel down to small, rural and minority-owned businesses.

But the second batch has evaporated almost as fast as the first. Why? Because PPP was a government intervention without much thought to oversight, which is why if you ask many small businesses around the region if they feel “rescued,” the answer is a resounding “No!”

Meanwhile, more than 200 publicly traded companies have raked in over $800 million in small business funding.

When we asked Washington’s senior U.S. Sen. Patty Murray about this outrageous breach, she said the “inequity surrounding the PPP must be called out.” She wants the Government Accountability Office to investigate why large hotel and restaurant chains grabbed a substantial number of loans while small businesses in our state suffer.

We agree with Murray; oversight is a necessity, but it won’t help South Sound businesses like Natchaya Salon in the short term. Only a boatload of cash can do that.

Other tweaks to the PPP program would also help, such as plugging loopholes that allow scores of employers with more than 500 employees to take advantage of it.

A recent TNT letter writer has another good idea: “For the small businesses that constitute the fabric of our community and desperately need financial assistance, we must continue to pressure corporations that have received funding to return their loan,” wrote Abby Givens of Lakewood, the daughter of a small business owner.

Sometimes a little public shaming can go a long way.