CLEVELAND — When 5 On Your Side Investigators delved into the government data on a federal program meant to preserve jobs during the coronavirus pandemic, we found Ohio's information contained serious flaws, missing information, and concerns about the recipients who received billions of tax dollars.
News 5 has compiled a database of all Ohio companies who received over $150,000 in Paycheck Protection Program (PPP) loans. The Small Business Association has not released data on companies that received less than $150,000. Search the database below or click here to view it on a separate page.
A chaotic time
"It was pretty chaotic in the beginning," said Gregory Spoth. Along with his wife, Spoth is the co-owner of Geraci's Restaurant, the East Side Italian eatery famous for its pizza.
After state shutdowns sparked by the coronavirus forced him to only offer carryout for customers, he was concerned about the future of the restaurants, originally created by his wife's parents.
"You've now cut my business by 70% and all the bills are still there," he said.
So when Congress created the Paycheck Protection Program to offer loans to small businesses in exchange for retaining their staff, Spoth immediately filled out the applications. He said the process was confusing at times and required several different iterations of the application.
Eventually, he said he received approximately $300,000 to retain about 60 employees at their three locations in Pepper Pike, University Heights and Mayfield Village.
"It was a very big relief when we finally got word that each place got some funding," he said. "It just made all the difference in the world. I’m sure there’s tons of restaurants out there that would say the same thing."
However, it will be nearly impossible to determine the actual number of jobs protected by the program.
5 On Your Side Investigators found serious flaws in the data released this summer, including the most critical category: "Jobs Retained."
"It's astonishing how bad the data is," said Veronique de Rugy. De Rugy is a senior research fellow at the Mercatus Center, a conservative think tank at George Mason University in Washington, D.C.
"This data, like most government data, to be honest, is very imperfect," she said. "It also tells me that this isn’t a process that was thought through and certainly its implementation wasn’t thought through."
"It’s surprising that... the whole system didn’t make a point to get that data right because the PPP program was actually meant as a way to help small businesses retain jobs so you would think, because the retention of jobs is a condition to actually get your loan forgiven, that at least they would have the data on jobs correct."
De Rugy said the government should have offered a line of credit to businesses to reduce mistakes, waste, fraud and abuse.
During a review of the 22,888 PPP loans distributed to Ohio businesses, non-profits and schools, we found some of the information pertaining to the number of jobs saved was inaccurate or missing.
There were 732 Ohio entities listed who received PPP loans that listed "0" under "Jobs Retained."
The businesses listing zero "Jobs Retained" include Aladdin's Eatery, the popular Northeast Ohio Middle Eastern restaurant chain.
When News 5 called, a manager laughed. She said there must have been a mistake.
She said the restaurant never completely shut down and has retained its entire staff.
We also found the data isn't just wrong, it's missing.
Under "Jobs Retained," there are blanks for 1,266 Ohio PPP loan recipients, including big names who received big bucks.
Barrio, the popular local taco chain and Malley's Chocolates each received a more than $1 million PPP loan.
Malley's was surprised when we called. A spokesperson said he did not know why the data was blank and said they kept every employee.
Barrio did not respond to our e-mail.
“I feel like we did more than a great job. Was it perfect? No. But it was near perfect," said Rob Scott, Regional Administrator, U.S. Small Business Administration.
The U.S. Small Business Administration was assigned with the gargantuan task of administering the PPP program.
“We stood this up at a rapid pace in order to get billions of dollars out onto Main St. to save as many small businesses as possible," said Scott.
Scott said the SBA will gather additional data about jobs retained when entities that received PPP loans submit their loan forgiveness applications. If most of the money was used to pay employees, the loan will be forgiven.
Scott also said PPP loan recipients who received more than $2 million will be audited to ensure tax dollars were properly spent.
"On the front end, we didn’t get a lot of the information that folks are asking for now," he said. "But the great thing is we are asking it on the back end so when a borrower, a PPP borrower, applies for loan forgiveness, there is a one-pager that asks for that specific information, whether it be demographic, male, female, what race, so we can really hone in on how the PPP certainly helped and assisted those underserved markets.
"The amount of money we were able to push out and the amount of time we are able to do it, I think you will see down the road saved the U.S. economy," he said.
'A massive lifesaver'
"The PPE loan was a massive lifesaver for this organization," said Kirsten Ellenbogen, CEO, Great Lakes Science Center.
She said the Great Lakes Science Center received approximately $688,000 to help pay 45 full-time and 47 part-time staff during the pandemic.
“We would not have made it past the first ten weeks without the PPP loan," said Ellenbogen.
She said the PPP loan also gave the non-profit museum and educational center the flexibility to respond to the community's needs.
Among about a dozen projects, Ellenbogen said she and her to set up timely new exhibits, including one about coronavirus and how racism impacts health outcomes.
"It’s never been more important than today to really make people feel confident to ask the right questions," she said.
The GLSC also held summer camps and will host approximately 100 students studying remotely this fall.
However, Ellenbogen said the science center could use another loan.
"The consequences of moving past our PPP loan have been severe," she said. Ellenbogen said the six members of the staff's executive team have taken salary cuts, 11 employees have reduced hours, and five are furloughed until Oct. 1. On top of that, every employee is required to take two weeks of unpaid leave this year.
"We’re limping along pretty good, kinda keeping our heads above water," said Spoth. "Certainly not making the kind of money we think we should be making."
Spoth said Geraci's Restaurant received just enough money from the feds to help them survive through the pandemic.
"I guess, without it, I don’t know that we would be able to have made it," he said.
Though few customers want to eat indoors, he has expanded their indoor dining areas. For a short time, they created a deal where they sent first responders a free pizza for every pizza customers ordered. On top of that, their takeout business has increased.
Still, Spoth worries what will happen as we head into the fall and cooler temperatures.
The missing data is just one mystery about how your tax dollars were spent as the coronavirus shut down the country this spring.
So far, the SBA has only released information about businesses that received PPP loans larger than $150,000.
The government has refused to release information about the millions of businesses that received small amounts of tax money.
Scott said it's a matter of time before the information becomes available.
"I would say down the road, it likely will be public in a modified format... so that everyone will be able to analyze it," he said.
So far, the PPP program distributed more than $5.2 billion to more than 5.2 million businesses, according to the SBA's website.