Three publicly traded hotel companies tied to a Texas businessman said that they might not refund many dollars in loans from a government program aimed toward helping small businesses.
The three hotel companies, Ashford Inc., Ashford Hospitality Trust and Braemar Hotels & Resorts, which are tied to Texas hotel magnate Monty Bennett, have applied for $126 million in loans and received $69 million, consistent with a calculation from securities filings by The Associated Press. They will use the cash to guard jobs, they said during a statement. Since mid-March, the businesses and their hotel properties have furloughed or laid off 90% of their workforce.
Looking at the pressure coming in from the government several big companies including hotel and restaurant chains have returned the PPP loan amount they received. Media is worried over about the PPP receipts being misplaced. The program was developed for small businesses which are distinguished with the sales, turnovers and capital involved along with number of employees working in to accommodate with the finances. And also to shore up these businesses and see people get back to work even from home.
“It is unlikely that a public company with substantial market price and access to capital markets are going to be ready to make the specified certification in straightness , and such a company should be prepared to demonstrate to SBA, upon request, the basis for its certification, Treasury Department said.
The Small Business Administration also issued an advisory Thursday clearly aimed toward larger companies that took money, with new guidelines implying that unless a corporation can prove it had been truly eligible for a loan, the cash should be returned by May 7.
In my opinion, it has made the guidelines clear and should expect people to abide by the norms and policies of the program. The one who is starving to survive should be helped first rather who is already in the capital market and is able to survive.