Some Chattanooga business owners left in limbo when rescue program ends ahead of schedule

·3 min read

May 15—Most of their clients made it in under the wire, but some business owners are left wondering if they'll get Paycheck Protection Program funding after the money dried up nearly a month ahead of the application deadline of May 31.

"We were getting information from the Tennessee Bankers Association about how much money was left and how close it was getting, so we put a hard stretch to tell our clients, 'You'd better hurry,'" said Kenny Dyer, market president for Pinnacle Bank in Chattanooga. "I will admit I was a little surprised to see how quick the money was drying up."

Pinnacle Bank made $77.6 million in loans to more than 600 local businesses in the most recent round of funding. About 40 clients appear to have missed their shot at funding because of the program's abrupt end, with three or four of those in the Chattanooga market, said Pinnacle spokesperson Joe Bass.

"The good news is the [Small Business Administration] told us they had set aside enough funds to cover applications that were in their hands," he said. "I'm not sure if that's going to work out, but yesterday we had an application that had gone back and forth I think 15 times, and they finally approved it."

George Wilson, who owns Southern Payroll & Benefits, said he had put in two applications for clients on the day the program ran out of money. He has about six clients that aren't sure whether they made the cutoff, Wilson said.

"It's just so ambiguous right now," he said.

The massive rescue program for business hit by pandemic losses has sent nearly $800 billion in potentially forgivable federal loans to U.S. business since it launched a little more than a year ago.

Though the Paycheck Protection Program has run out of funds, there are still critically important rescue programs available specifically for restaurants and entertainment venues, which were particularly hard hit, said Jay Dale, the market president for First Horizon in Chattanooga.

"I have heard several customers apply and get significant money from those programs," Dale said. "I would still encourage people to apply for those."

First Horizon made about $50 million in loans through the second round of the Paycheck Protection Program, he said, and now a lot of attention is shifting to the forgiveness process.

"We had been asking for customers to be patient through March and April because we felt like there would be more clarity on the process for forgiveness, and they did ease the requirements for loans under $150,000," Dale said. "Now we've sent out invitations to the vast majority of customers saying you don't have to wait anymore."

Kelly Hailey, who owns two Pigtails and Crewcuts businesses in Chattanooga, received funding in both rounds of the program. The money was the only way her business made it through the pandemic, she said.

"We would have had to close without it," she said. "There's no doubt in my mind."

Her total loans come in under $150,000, so she will have a simplified forgiveness process, but she hasn't started it just yet, Hailey said.


"That's definitely in the back of my mind, tracking it and how I'm spending it," she said. "I'm feeling some pressure to make sure I get it off my plate."

Loans from the first round of funding that haven't been approved for forgiveness will start coming due for repayment in August, Bass said.

"Just below 70% of first round applications [among Pinnacle clients] have started the process," he said. "Deadlines are going to be coming up. There's no more reason to wait."

Wilson said he has sought forgiveness for his loans for Southern Payroll & Benefits, and is helping clients do the same.

"I'm encouraging clients, let's go head and get your forgiveness done," he said.

Contact Mary Fortune at or 757-6653. Follow her on Twitter @maryfortune.