A federal program meant to save small-business jobs in the wake of the COVID-19 pandemic has poured between $250 million and $500 million into the greater Denton economy in the past few months.
The cash infusion from the Paycheck Protection Program, part of the $2 trillion CARES Act, may have saved at least 35,000 jobs in Denton and surrounding cities. However, the loan data released this week by the Small Business Administration had gaps in both reporting and specificity.
A total of 44 Denton-area businesses and nonprofits received at least $1 million or more in forgivable loans. Another 345 received somewhere between $150,000 and $1 million. More than 3,000 other small businesses and nonprofits received less than $150,000.
Denton Bible Church was among those employers receiving at least $1 million or more. The program did not exclude religious organizations, which have payrolls to keep, too. Liberty Christian School received more than $2 million for its payroll, which reported 333 teachers and staff for its forgivable loan.
The school did not return a call for comment.
The church’s human resources director, Jason Mendeke, said the church received $1,017,000 in early May to cover its payroll. The church has 138 employees, 86 of them working part time.
“When we ran payroll today, we used up the remainder of the loan,” Mendeke said in an interview Thursday.
In other words, the program underwrote the church’s payroll for about three months, even though the church had up to 24 weeks to use the money.
Had the church been forced to lay off employees, the 86 part-timers likely would have been cut first, he said. In addition to the loss for those individual families, the layoffs also would have affected the church’s ability to respond to community needs triggered by the pandemic.
“The real value of the PPP loan was to keep our current staff,” Mendeke said. “It allowed us to shift some operating funds to ministries in the community.”
Some facets of the federal program moved so quickly that the church is still waiting to hear from the lender about meeting the loan forgiveness requirements, Mendeke said.
The largest forgivable loans didn’t necessarily go to those Denton area companies with the most people on the payroll. Titus Transportation, of Ponder, reported 460 people on its payroll, and U.S. Trinity Energy Labor Services, of Argyle, reported 122. Both received somewhere between $5 million and $10 million in forgivable loans.
Neither Titus nor U.S. Trinity returned a call for comment.
In addition to jobs in the transportation and energy sector, the loans supported jobs at car dealerships, manufacturing and construction companies, health care offices and the hard-hit hospitality industry.
Artis, a restaurant company based in Lake Dallas, received a loan of between $2 million and $5 million to keep its payroll of 400 employees. O’Reilly Partners, which owns convention center hotels in several markets, received a loan between $1 million and $2 million for its 151-employee payroll at the Embassy Suites by Hilton Denton Convention Center Hotel.
Depending on the size of the loan, the SBA released the loan data in one of two ways. Companies and nonprofits that received more than $150,000 were named, but the agency did not specify the loan amount, only the range. Companies and nonprofits that received less than $150,000 were not named, but their exact loan amounts were released along with some general identifying information, such as the city where the company is located and the kind of business it is.
Thus, without business owners disclosing additional information voluntarily, local public officials and taxpayers cannot know whether those 389 largest loans to Denton area businesses covered about $136 million in payroll costs or came closer to a $333 million subsidy.
Nor can they know exactly where another $104 million went in supporting the area’s smaller businesses and nonprofits, although they can know the type of business.
In addition, some jobs data was missing from the reports. Nearly 270 of the 3,400-plus businesses and nonprofits that received loans did not report how many jobs those loans were supporting. That included 18 employers who received $1 million or more in forgivable loans.
Nor did many entities report requested demographic data that would help identify assistance to women- and minority-owned businesses.
In other words, local officials and taxpayers don’t have much information about Denton-area jobs that were saved, at least temporarily, by the program.
Denton’s unemployment rate shot up to 14.1% in April and eased somewhat to 12.6% in May. The county’s unemployment rate also improved from 12.9% in April to 11.9% in May.
June’s unemployment numbers may be affected by the latest surge in the virus. The Texas Workforce Commission was scheduled to release those numbers Friday.
Employers have until Aug. 8 to apply for a forgivable loan through their bank. More information can be found at sba.gov.
Federal officials said the average PPP loan stands at about $107,000, and nationwide the program has backed more than 4.9 million forgivable loans worth $521 billion.
Payroll Protection Program loans of $150,000 or less
|City||No. of loans||Loan totals||Jobs retained|
Payroll Protection Program loans of $150,000 or more
|City||No. of loans||Jobs Retained|