Yep. The Paycheck Protection Program is a boondoggle.

I hate to say, "I told you so," but damn if this isn't exactly what I expected.

I spent the day wrangling with the banks, trying to get the particulars of the Paycheck Protection Program (PPP).

Apparently, it's the equivalent of 2.5 x the average payroll of one month, minus taxes.

It's supposed to last for eight weeks.

How is that supposed to help? Add in taxes and the program is giving you basically two months payroll. It's supposed to also be available for rent, utilities, and mortgage, but I fail to see how there is anything left over for that.

If, on the other hand, I lay my employee off, she will get a minimum of the same amount for whatever length she's unemployed. (By my reading, she actually gets an extra $600 a week, though I wouldn't be surprised if that's B.S. too.)

To qualify for the loan, I have reams of paperwork and proof I need to supply, some on tax forms that haven't yet been done. They want a Profit and Loss statement, plus other particulars that as a Sole Proprietorship I've never needed to do.

So I asked the first banker. "2.5 times my average payroll over too months minus taxes will only pay for my employee for two months. What's the point?"

"Well, some people have bigger payrolls..."

"It doesn't matter how big the payroll is. It's still the same percentage!"

So here's the thing. The way I originally read the program was that they wanted the payroll for a four month period--if I remember rightly, January thru April of 2019. Which they would then give 2.5 the amount for the loan, predicated on keeping employees on the payroll. If we are closed for two months, this would leave money for rent and utilities, plus. (I expected to pay back the unspent amount or roll it over into a regular SBA loan.)

That made sense. It would make the store whole, keep the employee on the payroll, and allow us to open without too much damage. (I still had existing bills from my wholesalers when the revenues stopped flowing.)

I'm wondering if the banks are misinterpreting the measure. I guess we'll find out.

Meanwhile, I was informed by my main bank that the amount of loans they set aside for the program was already gone, but I might be able to qualify for the next amount. He said that a bunch of businesses had already told him that they were simply going to lay off their employees instead of pursuing the PPP.

The second banker informed me that they were servicing existing accounts first. (Not my regular bank, so I'm at the bottom of the list.)

I was also told that the SBA was already overwhelmed, that one bank had already submitted 10,000 loans of which only 5 had been so far approved.

When I called my landlord's property management I was told by the agent that she'd applied and run into the same problem. That she probably wasn't going to go through the program either.

Meanwhile, I'm getting rent relief, so that only thing I really have to worry about is utilities which are the smallest portion of my fixed expenses.

Good job, Congress. You passed a completely useless measure.