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Monday, October 2, 2023

Payroll Protection Program failed to protect Black-owned businesses

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For too many of our Black businesses the Payroll Protection Program (PPP) was a hoax.  

We heard that this was an issue. In fact, just like the impact of COVID-19, we should’ve known this was coming.  

The first round of PPP was a disaster with large companies gobbling up much needed funds for small businesses — we need not revisit that dishonor roll.  

But what happened in Indianapolis on the first round? 

On one level it is hard to say because some of the large banks apparently didn’t bother to include race in their data collection.  

I tend to think this was on purpose either because they truly believe in some ridiculous colorblind ideology, and it was their way to stick it to us by messing up the data. 

In either case, it was wrong to not include the data we needed to ensure that the program acted properly. It does not lead to trust and diminishes the propensity for accountability — the reward for their incompleteness.  

Anyway, even with bad data the first round of PPP was not great for Black businesses. Nationally, we saw a 41% decline in Black businesses due to COVID-19 — PPP didn’t save them.  

According to the data the SBA provided, 97 Black firms received loans under $150,00. The SBA data shows that loans to Black businesses ranged from as low as $522 to $141,237.  

In the Latinx community only 60 businesses received loans with the lowest at $1,250 up to $148,600.  

Twenty-seven Black businesses got $150,000 or more but less than $1 million. Seven Black businesses got over $1 million in PPP loans.  

The SBA showed that there were 873 white businesses that received loans up to $150,000, while 406 white businesses received PPP loans greater than $150,000.   

Thirty-seven white businesses received loans between $1 million and $10 million.  

But the real problem is 2,039 loans over $150,000 did not include race and over 8,512 loans did not have race data for loans under $150,000. 

So, we don’t know how many Black businesses benefited from the first round of PPP, only that it looks like we lost nearly half of them due to COVID-19.  

For an industry that is predicated on paperwork, it is shocking that seemingly so few bankers chose to identify the race of the person receiving these precious federal dollars meant to keep all business open.  

The local banking community failed to support the idea that Black businesses mattered by keeping track of who got what – even to make sure they were doing right by our community.  

Corporate Black Lives Matter statements be damned — this isn’t how corporations show Black lives matter.  

The conversation about a Black Community Development Financing Institution is picking up, but we should also be talking about Black banks.  

While there is one Black credit union in Martindale-Brightwood, and a concerted effort to start another one on the far east side, the Black community clearly can’t stay in this current position — where banks can either knowingly or unwittingly skew key data and hide their loan activities.  

The Congressional Black Caucus (CBC) reports only 12% of Black businesses got what they asked for when seeking COVID-19 funds.  

They also shared data that suggested congressional districts with higher numbers of Black people got less funding and fewer loans than districts with the lowest percentage of white people.  

The Indy Chamber and city did important work in making sure Black businesses had access to the second round of PPP funding, and I include the Indy Black Chamber of Commerce as part of their success.  

However, the Indy Black Chamber of Commerce, as it continues to progress, should receive similar consideration in the future on receiving city funding mostly so we can know for sure Black businesses are getting due consideration.  

Advocating for Black businesses is what the Indy Black Chamber of Commerce does, and clearly, we need it now.  

Kudos to the banks that did the right thing, and the Indy Chamber for their efforts in supporting Black businesses. Kudos to the Indy Black Chamber of Commerce for continuing to advocate for the interest of Black businesses — their work is more important than ever.   

What I am hearing … 

As someone who is engaged in trying to do things to improve the community, I get my fair share of criticism. Some of it is helpful — some of it less so.  

The folks that led the effort to paint Black Lives Matter on Indiana Avenue received their fair share of critique, and maybe folks will still have something to say about how it was done and even the look of the final product. 

But you know what? Indianapolis has a Black Lives Matter mural on Indiana Avenue.  

Organizers including Malina Jeffers, Stacia Murphy and Leah Derray led this effort. They said the mural is in part a reclamation of a storied area of the city that many believe we have already all but lost.  

We reclaimed our time in 2019.  

Now we are reclaiming Indiana Avenue.  

Somehow, we should protect this statement of reclamation — perhaps a BLM park near the site?

Marshawn Wolley is a lecturer, commentator, business owner and civic entrepreneur. Contact him at marshawnwolley@gmail.com.

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