The funds in the Paycheck Protection Program (PPP), a $349 billion stimulus effort to help the nation's small businesses pay their workers and keep their operations running, are exhausted. It's been revealed how large chunks of the funds were gobbled up by chain restaurants, hoteliers and publicly traded corporations.
As a result of lobbied exemptions, larger food-service operations landed $10 million loans from the PPP. These include Potbelly Sandwich Shop and Shake Shack, which collected upward $100 million in cash on hand, as well as Fiesta Restaurant Group Inc, the owner of Taco Cabana.
Kura Sushi the largest revolving sushi chain in the US, collected a nearly $6 million loan also Ruth's Chris steakhouses and J. Alexander's received loans of $20 million and $15.1 million, respectively.
Non-restaurant companies also landed loans. Coal miner Hallador Energy announced $10 million PPP loan alongside other liquidity maneuvers such as suspending dividends and amending its credit agreement to free up $50 million more; and windmill maker Broadwind Energy, which said its subsidiaries received $9.5 million in PPP loans.
Part of the rationale behind targeting small businesses that employ less than 500 workers is that those companies don't have as many avenues to access capital as do larger entities, however, the bureaucratic process to create an independent commission free from lobbying pressure would take time. To be expedient, the government offered loans on a first-come, first-serve basis.
And that process favored those who already had the means for a seat at the table.