MEMPHIS, Tenn. (WMC) - Millions of dollars in taxpayer-funded loans that were meant to help small businesses stay afloat during the COVID-19 pandemic have been distributed to dozens of churches, private schools, and charter schools across the Mid-South.
The loans were part of the Paycheck Protection Program (PPP), which was created with the passage of the CARES Act.
Congress passed the CARES Act in late March as businesses from coast to coast were ordered to shut down because of the COVID-19 pandemic.
The PPP was designed to be a lifeline for small businesses during the pandemic by providing loans to cover up to eight weeks of payroll expenses.
The money can also be used to pay rent and utilities.
The loans can be forgiven if they are used on eligible expenses and to retain employees.
"It was intended to provide kind of a safety net for employees across the country," said Greg Akers, editor-in-chief of the Memphis Business Journal.
The Small Business Administration, which administers the PPP loans, says as of this week 93,750 loans have been distributed to small businesses and organizations in Tennessee, totaling $8.8 billion.
The SBA says 45,990 loans totaling $3.1 billion have been distributed in Mississippi.
Meanwhile, 42,524 loans totaling $3.3 billion have been distributed in Arkansas.
Nationwide, nearly 5 million loans totaling more than $517 million have been distributed, according to the SBA.
U.S. Treasury Secretary Steve Mnuchin applauded those numbers last week at a hearing on Capitol Hill.
"This is truly an extraordinary achievement and we are pleased that the loans were broadly distributed and made across diverse areas of the economy," said Mnuchin.
But nearly every business that received a loan remained a secret until earlier this month.
That's when the Trump administration released the names of businesses that received loans over $150,000.
"The first thing that stands out to me is how familiar so many of the names are," said Akers.
Aker's team reviewed the newly released government data.
The WMC Action News 5 Investigators combed through the data as well.
It showed more than 2,000 businesses in the Memphis area received a PPP loan.
"As you look through the list, it cuts across all the industries that we have here," said Akers. "These are restaurants. These are retail outlets. These are contractors and plumbers and every kind of business you can think of."
The largest loans of $5-10 million went to companies across different industries.
For instance, Campbell Clinic, a leading orthopedic practice in Germantown, received $5-10 million, according to government data.
Wendelta, Inc., a Wendy's restaurant franchisee company, and part of the Carlisle Corporation, also received $5-10 million.
Campbell Clinic did not return WMC's message for comment.
A spokesman for Wendelta said he was working on providing a statement to WMC.
Churches and private schools, which normally don't receive taxpayer money, also received millions of dollars.
The information the government released does not show the exact amount each organization received, only a range.
For instance, data from the SBA shows Germantown United Methodist Church received $2-5 million.
However, Senior Pastor Tim Carpenter says the SBA’s data is inaccurate. He says the church received $359,000.
“Our bank, SunTrust, has confirmed that the number was misreported,” said Carpenter. “The congregation of Germantown UMC continues to give generously as they can, but many people’s ability to give has been adversely affected by COVID. The congregation’s leadership, in support of its staff, applied for the PPP loan to make sure staff was not laid off during the pandemic.”
"Of course, churches do have employees and it is quite valid that perhaps giving at those churches has been diminished because of the pandemic," said Akers. "Though on one level, it is surprising to see churches get funding from the government. On the other hand, they're getting it as an employer."
Second Presbyterian Church in Memphis received $1-2 million, according to the data.
"We did receive an SBA Paycheck Protection loan, which has allowed us to provide stable employment for over 200 people," said Robb Roaten, the director of communications for Second Presbyterian. "We are thankful that we are able to maintain pre-pandemic pay for our staff in this time of complete uncertainty."
Hutchison School, a private all-girls school in Memphis, received a loan between $2-5 million, records show.
The school did not provide comment after being contacted by WMC for an interview.
St. Mary's Episcopal School, another private school, also received $2-5 million.
It too did not respond to WMC's requests for comment.
Charter schools, which are operated by nonprofits and receive millions in public funding each year, also received millions in PPP loans.
Charter schools across the country have been criticized for "double-dipping" by applying for PPP loans.
KIPP Memphis Collegiate Schools received between $2-5 million, according to government information.
Maria Alcón-Heraux, the KIPP Foundation's director of media relations sent WMC the following statement:
"Our students and families have been severely impacted by the pandemic. The PPP loan allowed us to provide a high-quality education to our communities' most high-need students. During the spring closures, we provided Chromebooks to over 300 families and print resources to over 800 families. For the upcoming school year, we will provide Chromebooks to 100% of our 1,780 students. KIPP Memphis Collegiate Schools created a relief fund to provide immediate economic assistance to families in need when schools were closed. KIPP Memphis, like all other schools, has and will continue to incur extensive cleaning and sanitary equipment expenses to ensure our schools are safe for our students, families, and staff. In addition, KIPP Memphis will continue to build out our mental health supports and services as our families cope with COVID-19 and the horrific killings of Black men and women in this country."
Soulsville Charter School received a loan between $350,000 and $1 million, according to the data.
Tim Sampson, the communications director for Soulsville Foundation, said like other schools, Soulsville Charter School found itself facing an unprecedented situation when it applied for a PPP loan.
"When we were forced to close our physical facility in March, we were, like many schools, concerned about impending funding cuts, especially their impact on our staff, unique programming, and families," said Sampson. "The PPP loan funds allowed us not to cut any staff members and to offset facilities costs at a time when our students' education is perhaps more important than ever..."
In all, charter schools, private schools, and churches across the Mid-South received somewhere between $50 million to $132 million, according to an analysis by the WMC Action News 5 Investigators.
Because the government did not provide a specific loan amount each organization received, an exact figure could not be calculated.
Akers said as far as the number of jobs retained by each PPP loan, the government data may be incomplete or inaccurate.
He said businesses weren’t necessarily required to fill out that field on their loan application.
“That’s a bit misleading,” said Akers. “It isn’t necessarily how many jobs were retained by the company because of the funding. That number is more of how many employees they have.”
The Paycheck Protection Program has been extended until Aug. 8.
For more information about the program, including FAQs, click here.