A federal stimulus program has paid the salaries for more than 5,000 jobs at Laramie-based small businesses during the coronavirus pandemic, according to data released by the federal government earlier this week.
Congress created the Paycheck Protection Program in March as part of the CARES Act. After multiple revisions, the current program has appropriated more than $600 billion in low-interest loans to small businesses to cover salaries and avoid layoffs.
As long as small business owners spend at least 60% of their loans on salaries and do not lay off any employees for the eight or 24 weeks that the loan is supposed to cover, the debt will be forgiven and paid down by the federal government.
Premier Bone and Joint was able to protect 163 jobs in Wyoming through a multi-million-dollar loan, the Laramie-based orthopedic practice reported. After the shutdowns started, the practice was forced to temporarily close some of its facilities, said Tom Wolfe, the company’s CEO.
“It was going to be tough,” Wolfe said. “We just didn’t want to furlough people and send them away.”
The loans were designed to keep people in jobs even when they could not work due to shutdowns. Otherwise, businesses might have laid workers off during the shutdowns, creating more stress for workers and making it harder to reopen when shutdowns ended.
“That keeps our workforce engaged locally,” said Brad Enzi, CEO of the Laramie Chamber Business Alliance. He said that some local businesses have reopened more quickly because they could keep their employees on payroll.
Economic impacts of the coronavirus and the shutdowns have lasted longer than initially expected, Enzi said. Lawmakers in Washington have debated for months whether to extend stimulus programs past the summer.
More than 600 Laramie companies and organizations received loans from the program, with loans as small as $572 for the sole proprietor of a business. More than half the loans were for less than $24,000.
At the high end of the loan program, 45 businesses in the city received loans of $150,000 or more. To protect privacy, the Small Business Association released the names of companies receiving at least $150,000, but only gave a range of the loan size, while releasing anonymized but specific loan amounts for smaller loans.
Trihydro, an environmental and engineering consulting firm, received the largest PPP loan in Laramie — the only one greater than $5 million. The loan helped the company pay the salaries of 477 employees, which is most of the company’s payroll.
About 140 of their employees are based in Laramie, and others are spread throughout Wyoming and the rest of the country, Jack Bedessem, the company’s CEO, wrote in an email. He said the company has not laid off any employees in its 35-year history.
“The PPP loan provided us some assurance in decision-making, including implementing measures to keep our employees working during this challenging time,” Bedessem wrote. “Our employees are our most valuable asset.”
Trihydro’s loan, like the four other loans in Laramie worth at least $1 million, was made by First Interstate Bank. The bank has made more than $1 billion in PPP loans throughout its six-state service area, said Randi Downham, First Interstate’s president in Laramie.
“Small businesses are the heart of our communities,” Downham said. “These loans mean businesses can stay in operation, their employees will keep getting a paycheck, and local economies and communities stay strong.”
In total, more than 50 banks and credit unions made loans to Laramie companies, according to the Small Business Administration data, including the Laramie-based UniWyo Federal Credit Union.
“This was a great effort by our financial institutions,” Enzi said. “That’s a good indicator of how tight our community is.”
Nationwide, the Paycheck Protection Program has made almost five million loans to small businesses, which the federal government generally defines as companies with fewer than 500 employees. Nonprofits and religious institutions were also eligible for the program.
Banks that participated in the program could make up to $24 billion from the loans they made, the Wall Street Journal reported last week. Banks collect a fee from the federal government when they process the loans, and they charge a 1% interest rate on the loans that. The federal government insulated banks from risk in the program by promising to pay back the loans of any companies that fail.
Some large banks, such as Chase and Bank of America, have pledged to donate any profit they make from the loans, Forbes reported Friday.
The program has been criticized for some of the companies that received loans. The Wyoming-based Yeezy, owned by billionaire Kanye West, received a multi-million-dollar loan, and the Catholic Church received at least $1.4 billion.