The ups and downs of PPP

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The federal government’s Paycheck Protection Program, which provided Small Business Administration loans that can be forgiven if the recipients use the funds to keep employees working, had a rough rollout. The demand proved too great for many systems to handle and the money ran out quickly. A second round provided several weeks later seemed to proceed more smoothly. NJBIZ asked several businesses around the state to describe their experiences with the program. Here are their responses.

Amy Russo, owner, Toast

The first time Amy Russo heard from Chase regarding her PPP application, it was a Sunday afternoon. “I was shocked it was anyone calling me on a Sunday afternoon, never mind the call I was actually waiting for,” said the owner of Toast, a restaurant with locations in Asbury Park, Red Bank, and Montclair.

“Aside of my deceased father, I couldn’t have been more thrilled to hear from someone.” By April 16, Russo had her money. Or most of it—she applied for one loan per location, $100,000 each for Asbury Park and Red Bank and $87,000 for Montclair, and loans for her Monmouth locations came in at once.

After waiting a few days to find out where money for her Montclair location was, her lender let her in on something: in her haste to apply, she entered an incorrect number on her application. After fixing up the paperwork, the last of the three loans came in on May 1. Dealing with Chase was easy, Russo said. A direct line between her and Chase’s Joseph Cook “made it real. Everything is ‘apply online’ or ‘push two to talk to someone’ and then you can’t actually talk to someone … the fact that I had this person to talk to and I had his cell phone number and he was so accessible, it was great.”

Dr. Rafael Levin, surgeon, Comprehensive SpineCare

Dr. Rafael Levin did his personal banking at CitiBank for years, but his business account was separate.

That is, until he sought a PPP loan, and his experience with Wells Fargo left a bit to be desired. “I understand there was a lot of unknowns in the first phase. There’s a big difference between communicating with a banker who says ‘this is what I know this is what I don’t know’… this is exactly what I did not get from Wells Fargo,” Levin said. “I was chasing them and never getting answers back. I always felt like they were doing me a favor just responding, even though I had an account there 20 years.” At Citi, business banker Jacob Zakif exceeded his expectations. Levin felt Zakif had his back 24 hours a day, and his availability was like “night and day” to his experience with Wells Fargo. Levin had questions about including 1099 employees in his payroll, and Zakif was available to conference his accountant. “I knew Jacob had 10 other customers like me diving him crazy but he never let that bother him. He always gave me that feeling that I was his only patient, like I like to give patients. ‘It’s you and me right now, and I’m here for you.’” Levin received a PPP loan of $341,000, the amount he applied for.

Julie Murphy, executive director, Partners for Women and Justice

Julie Murphy started her job on March 16, the first Monday after the State of Emergency was declared.

PPP loan applications started within a matter of weeks. Partners for Women and Justice, a nonprofit, has money in four different banks, most of it with Chase, she said. It was Thursday when she filled out a form online to find out when she could apply and Tuesday when Chase got back to her. But the website kept crashing, she said, and she had to start from the beginning eight or 10 times. “I spent probably 15 hours trying to deal with it,” Murphy said. “The other thing that really annoyed me, we have a representative assigned to us in the nonprofit department … all the communications said ‘don’t discuss this with the people you usually deal with. I had questions along the way, but they kept saying ‘you really can’t talk to her about this.’” On April 22, she read a New York Times article titled “Banks Gave Richest Clients ‘Concierge Treatment’ for Pandemic Aid,” which she said made her “furious.” And she saw another news piece about a small bank in Nebraska that processed loans from all over the country. She then sought pro bono advice from Jesse O’Connell and Kim Lomot at Lowenstein Sandler LLP, who connected her to New England-based Northeast Bank. “My experience with Northeast Bank was the most delightful thing,” Murphy said. The process was done in less than a week, and she’s set to receive her funds this weekend. “Every time I responded, [Northeast vice presidents] would email back saying ‘let us know if you have any questions.’” Northeast Bank doesn’t have any New Jersey locations, but Murphy raved about her experience with a small bank and noted that her other non-profit contacts have had similar experiences. “I have several small banks down the street from our office, and once I can to walk into a lobby, I plan to go to one of those banks and start developing relationship with them.”

Jeff Klein, president, Team KCI

Jeff Klein’s PPP application process had a couple of false starts, he said. The application went in the day before it was announced that Round 1 was out of funds. Cash rolled in “very quickly” from Chase once Round II started, though, and the network support company, which services out-of-warranty office equipment, received the $172,000 it applied for. By the time the money rolled in a month and a half after Klein and his team originally contemplated applying — at which point they were concerned the business would go south — they’d surveyed their customer base and found the customers weren’t actually going anywhere. So, he returned the loan. “It was a sense of what’s right,” Klein said. “We didn’t think it was right to take a loan we didn’t need when there were other companies out there that probably needed it a lot more than we did.” On June 1, Team KCI will have been in business for 38 years.