![]() ![]() Producing while company officials got ready to shut it down. Thinks the $10 million just helped FreightCar’s Shoals plant keep Jim Meyer, FreightCar America’s CEO, told ProPublica in an email that he had not intended to shutter the plant when he received the PPP money, and that it had allowed the company to keep workers on the job through most of 2020 despite a sharp dropoff in new orders. Managers announced that all production would move to FreightCar’s newįacility in Mexico, which meant most of the assembled workers would lose ![]() Some had believed the funds would keep the doors open for a little while longer. Only a few months earlier, the publicly traded company had received a $10 million Paycheck Protection Program Loan - the maximum amount available under a pandemic relief program designed to keep workers employed. Near Muscle Shoals, Alabama, to tell them that the plant was closingįor some employees, the news wasn’t a shock: They’d been hearing rumors that management would move the work elsewhere for years. The figure for 2021's loans trailed behind, at 85%, but Kelley told NPR he expects most of the remaining loans to be forgiven this fall.Late last summer, after churning along through the pandemic with only a two-week pause, managers at FreightCar AmericaĬalled hundreds of workers into the break area at the company’s factory NPR contacted dozens of these tiny businesses with outstanding loans and heard all sorts of additional reasons why they remain unforgiven, ranging from missed emails or botched applications to bad advice from accountants.īut the SBA says some of these PPP borrowers simply have not yet applied for forgiveness, since many of them can wait to apply for up to five years after their loan was issued.Īt a Senate committee hearing in August, Kelley said the SBA has already processed forgiveness decisions for about 97% of loans issued in the first year of the program, 2020. One fintech, called Kabbage, is facing a class-action lawsuit over claims it failed to process loan forgiveness applications quickly and properly. Many of these businesses that got their loans through financial technology companies, rather than traditional banks, told NPR they've had great difficulty getting them forgiven.įintechs, as they're known, are businesses that use newer technology to offer financial services. ![]() The SBA uses computer models to review all 11.4 million loans, according to Patrick Kelley, a senior official with the agency, but he says auditors have manually reviewed only about 215,000 loans, or roughly 2% of the total number issued. Meanwhile, the SBA is closely scrutinizing just a tiny portion of the millions of PPP loans for fraud and forgiveness eligibility. The SBA disputes these findings, but its own inspector general has estimated that at least 70,000 loans were potentially fraudulent. ![]() That's despite claims from University of Texas researchers that about 1.4 million PPP loans show signs of possible fraud, like suspiciously high payrolls and multiple businesses listed at the same residential address. The SBA expects that figure to grow to nearly 100% as more forgiveness requests are processed this fall. More than two years later, the overwhelming majority of these loans have transformed into government grants, as 91% have been either fully or partially forgiven, according to an NPR analysis of data released by the Small Business Administration on Oct. The program was designed to help small businesses keep workers employed during the uncertain early days of the pandemic. government began issuing nearly $800 billion in potentially forgivable Paycheck Protection Program loans. Small businesses were in limbo as the coronavirus outbreak raged and the first round of the government's multibillion-dollar Paycheck Protection Program drew to a close.Īs COVID-19 shutdowns threatened businesses back in 2020, the U.S. A closed barbershop in Cleveland in May 2020. ![]()
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