At this time when so few people are even permitted to travel – leaving virtually no one you can encourage to book direct. With cities and states under shelter-in-place mandates, and places of lodging being constrained to Essential Travel only, Innkeepers are rushing to secure funding such as EIDL (Economic Injury Distaster Loan) and/or the PPP (Paycheck Protection Program), but are finding these options less than satisfactory.
Below are 2 articles that outlines the issues with these programs, and how they fall short of the mark of truly helping those in the lodging industry.
- AHLA CARES Technical Corrections and Enhancements 4.8.20 [READ ARTICLE]
- Technical Corrections and Enhancements to the Cares Act [READ ARTICLE]
- The requirement that 75% of SBA Loan proceeds be used for Payroll Costs makes the program too restrictive and discourages companies from rehiring. AHLA proposes reducing the percentage threshold to 50% for hotels and related industries with significant real estate related costs.
- The Two-year Term on SBA loans is not enough time for the borrower to pay back the PPP loans. AHLA proposes to increase the term of the loan to at least four years.
- The current calculation for maximum PPP loans is just 2.5x the average monthly payroll for 2019 and is inadequate to help small businesses cover both payroll AND expenses during the covered period.
- The PPP is expected to run out of funding within the next several weeks and the covered period for the program ends on June 30, 2020. It’s clear that extended public health restrictions and a slow return to normal work, public gathering and travel patterns will result in small businesses having limited customers and revenue far beyond June 30.
ALP and AH&LA are asking for you to sign your name to a letter outlining these issues indicating your support for having them corrected. The lodging industry was able to generate more than 100,000 letters prior to the passage of the CARES Act. We need to double that amount regarding these changes that need to be made. Our industry now needs 200,000 signatures regarding these issues!
Please use the link above to add your name by end of day Monday, April 13th. The longer Congress delays on increasing funding to these critical programs, the longer it will take for our industry to receive the support we so desperately need.