RUNNING FOR COVER

Published on June 24, 2020

Beginning in July, the Small Business Administration (SBA) will begin releasing the names of businesses in receipt of Paycheck Protection Program (PPP) loans. According to Megan Henney, Fox Business article on June 24, 2020, “The disclosures will include the names of recipients who received loans worth more than $150,000, as well as addresses, NAICS codes, zip codes, business type, demographic data, non-profit information and number of jobs supported.” Payrolls, names of employees, and other sensitive employee financial data will be protected from disclosure. The loan amounts will be revealed in ranges:

·      $150,000 to $350,000

·      $350,000 to $1 million

·      $1 million to $2 million

·      $2 million to $5 million

·      $5 million to $10 million

The disclosure comes after heated negotiations escalated between Democrats, Republicans and Treasury, as Treasury Secretary Steven Mnuchin said, “We are striking the appropriate balance of providing public transparency, while protecting the payroll and personal income information of small businesses, sole proprietors, and independent contractors.” As the (PPP) loans are taxpayer funded, increasing political and consumer pressure for greater disclosure ultimately was achieved and may have some business owners running for cover.

According to Brian Hamilton’s article in The Hill, on June 24, 2020, “Now, business owners interested in applying for the remaining PPP money have to consider whether they want to be listed publicly as having received government aid.” Balancing the need for liquidity due to being adversely impacted by COVID-19, navigating the ever-changing rules and regulations, and now being faced with public disclosure of receiving (PPP) loans, further compounds the anxiety and stress levels for small business owners.

The good news for business owners eligible to apply for the balance of $130 billion in (PPP) loans is the extended deadline from June 30 to December 30 or later, with a consensus believing more stimulus is forthcoming.

Small business owners and CEO’s are challenged with juggling multiple threats, risks, and obstacles to maintaining healthy balance sheets, positive cash flows, as well as protecting employee morale. Expanding the advisory circle to include a fractional CFO consultant will deliver alpha [added value and Return on Investment (ROI)], while allowing the business owner or CEO to focus on leading and growing the business, not running for cover.