Delaware eases restrictions on restaurant loans again as a federal loan program runs out of money
More of Delaware’s restaurants can now access zero interest loans through the Delaware Division of Small Business (DSB). But another tool for small businesses in Delaware has reached its limit. The federal Paycheck Protection Program (PPP) has run out of funding.
The latest changes to the DSB Hospitality Emergency Loan Program (HELP) include lifting the revenue limit from $2.5 to $15 million.
“By opening it up to $15 million it [sic] allows our independent restaurants that maybe have more than one location to get help per location,” said Carrie Leishman, President and CEO of the Delaware Restaurant Association.
Under the program, qualifying businesses can apply for monthly loans of up to $10,000 to cover a range of fixed expenses.
If the business’ total mortgage or lease payments in a month exceed $10,000, it is eligible to apply for a loan of up to $50,000 per month to cover those expenses.
DSB Director Damian DeStefano says this third program expansion remains within the limits of the Division’s budget.
“We’re utilizing existing funds in our office that we have available to us, that we are redirecting into this area,” said DeStefano.
DeStefano says about 450 restaurants are in que for loans. If all qualify that would total about $4.5 million.
DeStefano also says staffing is a challenge for processing the loan requests. He says in a typical year the Division only processes about 50 loans.
“Right now we’re at about two to two and a half weeks processing time for an application. We want to get that closer to 10 days to two weeks,” said DeStefano. “But every time we expand we have to take that into account.”
Meanwhile, the now-tapped PPP reached its $348 billion national spending limit Thursday. The program had so far approved 5,171 Paycheck Protection loans totaling more than $1 billion dollars in Delaware. This moves Delaware out of last place, passing Wyoming in the number of dollars.
Small Business Administratin (SBA) Delaware District Director John Fleming says the SBA nationally processed more loans in 14 days than it had the previous 14 years. He adds he expects renewed funding for the program soon.
“In my opinion we’re just at a pause here,” he said. “Maybe for a couple of days.”