Eugene, Springfield business owners keep afloat with 723 payroll loans topping $658 million

More than 700 businesses in Eugene and Springfield received federal, forgivable loans above $150,000 meant to keep their workers on payroll during the pandemic.

The Paycheck Protection Program, created through the Coronavirus Aid, Relief and Economic Security (CARES) Act, was designed to distribute $669 billion to keep businesses solvent during the economic crisis.

Between $5 billion and $10 billion in PPP loans were distributed to about 63,000 businesses across Oregon, with between $274 million and $664 million given to Eugene- and Springfield-based businesses.

The loan program — hastily prepared, funneled through local banks and sometimes controversially distributed — awarded funding at rates of a maximum 2.5 times a business’s average monthly payroll costs. The loans are designed to be forgiven if the money is spent on payroll, mortgage interest, rent and utilities.

Few businesses have been untouched by the pandemic. In Oregon and across the country, unemployment has skyrocketed from historic lows before the outbreak.

A statewide lockdown meant fewer people driving and a significant decline in wrecked cars needing the attention of the mechanics at Auto Body Specialties in Springfield. Owner Byron Davis said his shop early on was doing about 40% its usual work.

“We didn’t have the work. People wouldn’t have been creating a product. I would have had to downsize,” Davis said. “We had a plan to carry people with full wages for two months, but after the two months we couldn’t continue that forever and just go broke.”

Davis’s company got a PPP loan worth between $150,000 and $350,000, the most common range for local awards exceeding $150,000, according to U.S. Small Business Administration records. The SBA loan information was released in ranges, with the largest local loan range locally between $5 million and $10 million.

A total of 723 PPP loans above $150,000 went to 590 Eugene and 133 Springfield businesses, according to SBA records.

Eugene loans totaled between $224 million and $541 million. Springfield loans were between $51.5 million and $123.2 million.

Two loans between $5 million and $10 million were awarded to Eugene businesses: Seneca Sawmill Company and Bigfoot Beverages through MLF Group, a part of its company that handles its payroll.

“The Payroll Protection Program loan is being used to keep all 390 of our employees working through the pandemic, including providing a $2 per hour wage increase to better support them through this challenging time,” Bigfoot Beverages co-presidents Eric Forrest and Andy Moore said in a statement. “Without the loan, our organization was facing difficult decisions concerning layoffs and reduced operations.”

Sales in late March at Seneca Sawmill, which employs 470 people in Eugene, were roughly a third of normal volume, according to spokeswoman Casey Roscoe. Seneca curtailed operations, including halting lumber production from April 2 to April 12.

She said even after applying for the loan, there was uncertainty in waiting for it.

“We were really dealing with a lot,” Roscoe said. “It felt like a roller coaster. We just took this turn down and we didn’t know where the end was going to be.”

The loan is being used strictly for Seneca’s payroll, and there were no layoffs, she said.

In Eugene, 25 businesses got PPP loans between $2 million and $5 million; 49 got between $1 million and $2 million; 181 got between $350,000 and $1 million; and 333 got between $150,000 and $350,000, according to SBA data.

In Springfield, only one business — plywood supplier Timber Products Company — got a PPP loan between $5 million and $10 million, according to SBA data. Three got loans between $2 million and $5 million; 14 got between $1 million and $2 million; 46 got between $350,000 and $1 million; and 69 got between $150,000 and $350,000.

PPP loans were primarily designed to pay workers, though there was leeway in using the money for costs such as rent and utilities. Auto Body Specialties was in good financial shape before the pandemic, but Davis said he didn’t need help with overhead.

“We would have been fine without it, but it would have taken all that reserved money from over the last year that we’d been saving and saving,” he said. “That would have depleted those funds. Not all of it, but three months of it. So it helped tremendously.”

The SBA resumed taking applications for the Paycheck Protection Program on July 6. The deadline to apply for a new loan is Aug. 8.

9,224 Oregon businesses that received an SBA loan of $150K or greater

Contact reporter Adam Duvernay at aduvernay@registerguard.com or 541-338-2237, and follow him on Twitter @DuvernayOR. Want more stories like this? Subscribe to get unlimited access and support local journalism.