County assistant administrator says SBA loan process ‘overwhelmed’

By: 
Terrance Vestal
Staff Writer

A video clip of the owner of a Lone Pine hotel recently was featured on the PBS New Hour, sharing his frustrations in trying to obtain Small Business Administration loans available for COVID-19 pandemic relief.
Inyo County Assistant Administrative Officer Leslie Chapman last week said that Travis Powell, owner of Lone Pine’s Best Western Plus Frontier Motel, isn’t the only business owner she has heard about who is frustrated with trying to navigate the process.
President Donald J. Trump on March 27 signed into law the CARES Act, which contains $376 billion in relief for American workers and small businesses, according to the SBA. Those funds were to be funneled to banks through the SBA. The bill totaled $2.2 trillion overall.
During the short video, which aired earlier this month, Powell said neither bank in Lone Pine is affiliated with the SBA. He said he spent a Saturday morning and sent out 32 applications and/or contact forms that he filled out online.
“I’ve heard back from about half of those and they all state the same thing – ‘at this time we’re only servicing people with existing loans or existing accounts,’” Powell said during the video.
Chapman said what she is hearing is that most of the banks are not processing loans except for established customers. She said from her research, its a policy that has been in place at many since mid-February. If a business owner wasn’t a bank customer before Feb. 15, that bank won’t process the loan.
Chapman said other banks are not processing loans anymore because they’ve already met their cap. She said she believes US Bank is accepting digital applications for existing and new customers.
“I think they might be the only one in our area that is accepting applications from new customers,” Chapman said.
She said she was getting “rave reviews” about Eastern Sierra Community Bank, which didn’t have the current customer requirement. But ESCB had to stop taking applications from non-customers because the bank just got overwhelmed.
ESCB is a part of Owens Valley Community Bank, which is based in Oakdale and has almost 20 branches throughout the state, including Bishop, Mammoth Lakes and Bridgeport.
“They’ve already had $120 million in loans approved,” Chapman said. “They’re part of a bigger organization so that’s not just our area.”
Chapman said people who are trying to complete the online application process are “just frustrated to death because they can’t get through, they get bumped out – I think the SBA is completely overwhelmed. So I’m sure that (Powell’s video) was an accurate reflection of his experience.”
Chapman said she thinks part of the problem, particularly in Lone Pine, is that El Dorado Savings Bank is an underwriter bank and is not handling SBA loans at all.
“It’s been a real problem for Lone Pine people because they bank at their local bank,” Chapman said. “And if that’s your only banking relationship and if that bank isn’t doing SBA loans, that puts them in a heck of a bind.”
Chapman said she didn’t think the current SBA situation isn’t restricted to rural communities, however.
“I think the whole SBA is just completely overwhelmed,” Chapman said. “The way it was just rolled out – a great program that needed to happen – it was rolled out quickly and overwhelmed the system. It’s the same thing with unemployment claims. I’m hearing the exact same thing – people, two, three, four weeks without work and haven’t been able to get their unemployment claim filed. The volume is just killing everybody.”
Chapman said the county is trying to stay on top of upcoming stimulus packages and to do as much as possible as far as lobbying and ensuring that whatever legislation goes through takes into account, small rural counties like Inyo County.
“How far that gets us, I don’t really know but we’re trying to stay on top of that just to make sure that whatever packages end up getting adopted consider the differences that rural counties have.”
She said the Small Business Development Center from CSU/Bakersfield has counselors and resources available. Kelly Bearden, the center’s director, has some consultants in Inyo County who can help people figure out some options that might work for them. Bearden can be reached at (661) 654-2856.
On the national level, congressional leaders and Trump already are discussing the need for a new assistance package to try to contain the COVID-19 economic devastation.
Those additional funds will be needed, according to the SBA. According to the agency’s website, the “SBA is unable to accept new applications at this time fro the Paycheck Protection Program or the Economic Injury Disaster Loan - COVID-19 related assistance program based on available appropriations funding. EIDL applicants who already have submitted their applications will continue to be processed on a first-come, first-served basis. More information can be found at www.sba.gov.

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