Westside small businesses struggle with loan programs and rent, ask for more assistance amid pandemic
By Kellie Chudzinski
As the novel coronavirus lockdown continues to put a strain on small businesses across the country, local business owners used District 11 Councilman Mike Bonin’s phone town hall on May 14 as a chance to voice their troubles and get some answers.
“I’m just a little guy. And I feel like I’m just left out in the rain,” said Richard Glass, a hair stylist and owner of Glass Hair Design in Venice. He, along with hundreds of thousands of others across the state, applied for a Paycheck Protection Program (PPP) loan from the Small Business Administration (SBA) back in March, though he had not yet heard back at the time.
The feeling of helplessness, struggles with the varied loan programs and repayments, as well as difficulties staying afloat were echoed by other owners from the Westside as they had the chance to engage with Bonin, Terri Billups from SBA, Deputy Mayor of Economic Development Billy Chun and Carolyn Hull of L.A.’s Economic and Workforce Development Department.
As the state of California and Los Angeles allow retail businesses to reopen for in-store shopping this week, the viability and financial uncertainty for some local businesses owners in services such as personal grooming and fitness still looms.
Glass, a born and raised Venice local, shared that as he waited for loan relief he was struggling not only to pay rent on his business space, but also for his residence.
“My landlords are asking for their rents and I don’t have it,” he said. “I’m just at my wits’ end, I don’t have any clue.”
Seventy-five percent of small business owners are struggling to make rent or lease payments, according to results of a survey conducted by Bonin’s office, though the number of respondents was not noted. The city and county have put moratoriums in place for commercial evictions, but others on the call disclosed fights with landlords over missed payments.
One woman on the call who identified herself as Sandy and the owner of a yoga studio in the Marina Peninsula for 18 years also shared her struggle.
“We really need some help, desperately right now,” she said. “I’ve had my business for nearly 20 years. I’ve never had a problem paying, but right now I’m getting harassed by my landlord, too.”
Offering some support, Chun said due to limits in place on evictions landlords “could raise as much noise as they want, but they really can’t do anything about it.”
Multiple callers voiced trouble contacting banks and getting information on the status of loan applications through SBA’s program and receiving funds, while others were frustrated with loans entirely.
“Where’s the actual aid that comes in the form of grants?” Audrey Woollen, owner of Urbanic Paper Boutique on Abbot Kinney, asked. “All [loans] do is make us owe more money. And none of us are going to have it because we’re all losing business for who knows how many months. We’ve got close to no income… It puts us in a crippled situation.”
While SBA PPP loans are eligible for forgiveness, if funds are used following terms for payroll and rent percentages, wide scale grants haven’t been available. Los Angeles is also operating its own microloan program for small businesses though Hull said its funds were “almost expired.” Speaker of the House Nancy Pelosi is expected to introduce new legislation for PPP loans that would give employers more flexibility in using
Many local businesses would reap the adjustment as, according to the councilman’s survey, 34% have applied for SBA loans and two-thirds have applied for Economic Injury Disaster Loan Emergency Advance support.
“The only way we’re going to get out of this is we’re going to need massive support from the federal government,” Bonin said of the various loan programs. “Individuals and cities alike are going to be in deep trouble.”
An April survey by the National Federation of Independent Business found more than 60% of small businesses could fail if the strain lasts past Labor Day. Similarly, Bonin’s survey found 64% believe their businesses will not survive “this economic catastrophe,” as a third have laid off employees while 65% have shut down partially or entirely.
With slow steps being made to reopen businesses, Mario Vollera, owner of Roosterfish and South End in Venice, looked for help in using public space once he is able to reopen to adjust to expected limits on restaurant capacity.
Bonin said he was working on legislation to give businesses use of public spaces including street and sidewalk space for that exact reason. He said: “I think we need to be looking at using some of our public [space] right away to help our small businesses as well.”
“We are struggling. Yes, we all are,” Vollera said. “I think we need to keep a positive attitude.”