Small businesses loans are a mix of hope and frustration

He was number 1,200 in the cue for the Small Business Administration helpline. Two and a half hours later, Michael Tomich got through to a real person who pointed him to a specific loan application to get a lifeline for his business, The Old Oak Coffeehouse in Niwot. It was a different form than the one he initially found on the SBA website, making it worth the time and patience he needed to spend hours on hold.

"This is stressful and I'm spending huge amounts of time on it," said Tomich who is slogging through the process, because it's his best hope. "It could keep us open for a couple more months."

The Paycheck Protection Program would allow him to retain his workers and make the rent at a time when business is down 70%. "We have employees that are incredibly afraid of their financial situation," said Tomich.

The goal of the program is to keep businesses afloat during the coronavirus pandemic. It allows those with less than 500 employees to get loans to cover eight weeks of average payroll, plus 25%, according to SBA.gov, the website for the Small Business Administration. The loan payments can be deferred for six months and, ultimately, will be forgiven if employers keep people on the payroll.

The loans are executed by lenders, not the SBA. Tomich feels fortunate that he already started discussions with his lender, Chase Bank, since demand is expected to be overwhelming. The application process officially began April 3rd, but Chase delayed its participation. The bank notified small business customers in an email that day that said, "We hope to have the guidance we need from the government soon so that we can begin assisting you."

Banks and business owners are trying to sort through the specifics. "Confusing" is the word Tomich keeps using when he talks about the program. The details are what concern him and others who have jammed the SBA helpline and website, causing technical problems due to a crush of internet traffic.

"It's kind of scary that they say it is forgivable but the parameters around the forgiveness are unclear for a coffee shop. It's different than being an office type of business. What would help us is the reassurance that we are acting in good faith and trying to protect our employees' income and they won't split hairs with us," said Tomich.

"If it saddles us with debt, then we've shot ourselves in the foot. I would hate to be penalized for trying to keep the business open, support our employees and the community we serve."

The bright yellow walls of the Old Oak Coffeehouse still look cheerful, but there are signs of hard times. Chairs are flipped upside down on the wood tables. There is a stack of paper to-go cups and containers, the only way employees are allowed to serve food and beverages. A sign on the door tells customers that only five people can be inside at a time and they need to stay six feet apart.

Five is a crowd these days. Tomich said baristas can spend an hour or longer without seeing a soul. Their steamers are silent in a place designed for the din of people chatting and the clatter of ceramic coffee cups. Even the street outside is quiet. "It's like a little ghost town downtown," he said.

Tomich opened the business with his wife, Patty Machen, nearly three years ago. The Old Oak grew into much more than a place to get coffee. It's where people hung out with friends on the patio, ate waffles on Sundays, went out for spaghetti and meatballs on Saturday nights, sipped wine and listened to live music.

It was going really well until a few weeks ago he said. "We had our biggest night ever. The place was packed. People were standing. It was like nothing could derail this little thing Patty and I thought of. To have it gone is so so sad."

The social part of the business won't be back for a while, but Tomich is hoping he can limp along until it does. It isn't clear when he would get the loan so he's watching his cash reserves and has cut back hours for the shop and his workers. Once he has the money to pay his employees, he's not sure what he'll do with them. There used to be enough work for three, now there is barely enough for one.

"It's almost as if the government is asking us to fabricate demand by keeping people on the payroll. Do they really want me to have three people standing around with nothing to do? Or should I just pay them to not work?" He is looking at things like painting, maintenance and inventory.

The loan process is rough, the bank account rougher. But Tomich says there is still something to be grateful for. "This incredible community is supporting us in spite of people not wanting to be out --buying coffee beans, gift cards, anything they can do to support us."

With loyal customers and a federal boost, Tomich is hoping the Old Oak will still be standing when this is all over.