The small business loan program that was created to help businesses keep their workforce employed during the coronavirus crisis is officially out of money.
The emergency fund administered through the U.S. Small Business Administration (SBA) offered a lifeline to struggling small businesses with fewer than five hundred employees.
The SBA website on Thursday showed a message that the agency is “unable to accept new applications at this time for the Economic Injury Disaster Loan (EIDL)-COVID-19 related assistance program based on available appropriations funding.” It also indicates they are unable to enroll new lenders through the Paycheck Protection Program (PPP) at this time.
The agency says it approved more than 1.6 million applications, dispersing $339 billion to small businesses throughout the country through 4,900 participating lenders.
In a statement, they said, “The SBA has processed more than 14 years’ worth of loans in less than 14 days. The Paycheck Protection Program is saving millions of jobs and helping America’s small businesses make it through this challenging time.”
And they added, “By law, the SBA will not be able to issue new loan approvals once the programs experience a lapse in appropriations.”
Chris Simpson, who owns the Sail to Trail Winery in Worcester, learned last week that he was approved for the PPP loan, but is still waiting for the paperwork to come through.
"When the bank called me they gave me an e-tran number," said Simpson, "which supposedly is to take part of that $350 billion and set it aside for the winery. So, in theory, that money has already been set aside for me.”
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But with news that the fund is depleted, he's not sure of what that means for him.
"I'm still mildly hopeful that I'm going to get the e-signature email today and that tomorrow I'll wake up and look and there will be a deposit of funds in my company checking account," Simpson said. "I won't believe it until I actually see it in the bank account."
The depletion of the fund's resources is set to launch a battle between Republican and Democratic lawmakers over the shape of additional relief funding.
Massachusetts' Sen. Ed Markey, a member of the Senate Small Business Committee, issued a statement Thursday calling on Congress to work together to provide immediate additional disaster assistance funding for small businesses.