Juneauites gathered signatures to recall Gov. Mike Dunleavy in late February. (Peter Segall | Juneau Empire)

Juneauites gathered signatures to recall Gov. Mike Dunleavy in late February. (Peter Segall | Juneau Empire)

Alaska Voices: PPP is far from perfect, and Dunleavy’s plan is far from what we need

The governor is denying small businesses a critical survival tool that will go far.

  • By Aaron Welterlen
  • Thursday, May 7, 2020 10:07pm
  • Opinion

I have owned and operated multiple small Alaskan businesses over the last 15 years, and like many Alaskan entrepreneurs, this pandemic has caused major financial uncertainty for the future of my companies. Governor Dunleavy lacks a plan that puts money where his mouth is — if small businesses were truly his priority, he would amend his current course of action and provide grants, rather than federally funded loans (the last thing we need is more debt), to small businesses. Instead, the governor looks poised to consciously repeat the same problematic rollout of the federal Paycheck Payment Program (PPP), which left a large percentage of small businesses in Alaska high and dry.

Entities fortunate enough to qualify for the PPP, no less, now have the unenviable privilege of figuring out if their loans will be forgiven as a grant, or if more unwelcome debt has been added to their balance sheets.

It wasn’t surprising to read that one in six businesses is afraid it will permanently close because of this pandemic. This fear is precisely why I’m concerned that Dunleavy is re-creating the same problems the federal government has created in attempts to keep businesses afloat.

Two important facts: first, the PPP often falls short in serving businesses that don’t have strong, existing relationships with their banks, which play a big role in determining how these funds are distributed on the ground. Second: loans through the PPP must primarily be used to pay for payroll, rather than operating costs. While payroll protection is a must, another overlooked item is day-to-day operations (fuel, materials/goods, etc.) — often some of the most expensive line items to running a business, hence the need for grants.

Right now, if you haven’t received PPP funds as an Alaska business owner, you haven’t received any relief money, period. Municipal and state loans were made available in many parts of the country a month and a half ago. Seattle, for example, closed its first round of emergency relief grants for business owners on March 27.

Alaska is lagging behind, and that’s unacceptable. Dunleavy is currently sitting on $300 million that he could make available to small businesses in the form of simple, guaranteed grants.

So why isn’t Dunleavy using his authority to provide grants to small businesses that desperately need them, rather than offer loans that many will not secure — at a time, no less, when businesses that qualify for PPP loans have already taken on new pandemic-induced debt?

The governor is denying small businesses a critical survival tool that will go far when it comes to making it out of these trying times. At this point he’s sitting on money that needed to get into business owners’ hands long ago.

I see a notable recurring theme: this governor has not listened to us, nor has he learned from previous mistakes.

If you have ever run a business (and even if you haven’t) you understand what it’s like to invest years of your life into a passionate venture. Most of us can then imagine the heartbreak of watching forces far outside of your control lead to its abject failure. In these times, we need our governor to have our back, to come to our aid without delay.

It’s not yet too late for us to right Alaska’s course, save the mom and pop shops, seasonal operations, and other longstanding businesses that serve as cornerstones in our communities. Now is the time to issue grants not only to businesses but also to Alaskans in need who have lost their jobs, their livelihoods and still have bills to pay. This is not a blanket request for free money to all (business and personal), however it is the right thing to do, expeditiously and without delay.

I’m tired of losing sleep most nights, asking myself the simplest question of all: what is Dunleavy’s plan for Alaska’s economic recovery? Unfortunately the answer is troubling and in plain sight: he has no plan, no thoughts, no concrete clue how to lead us out of these trying times.

Alaskans need a stronger leader to lift us back to where we truly should be.

I urge each and every one of you to sign the recall petition as soon as possible.

Aaron Welterlen owns several companies in Fairbanks. He is a member of the Recall Dunleavy steering committee.

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