Lamoille County businesses obtained more than $46 million in federal loans to help employees keep their jobs in the pandemic.
The $521 billion Paycheck Protection Program was created by Congress to preserve jobs as the economy cratered during the pandemic shutdown that began in March. The longer employees stay on the job, the less employers have to repay, and ideally the loan turns into a grant.
More than 500 companies in Lamoille County took out more than $46 million of these loans — some for thousands and others millions. Eleven companies took out $1 million or more.
The rest of the money went to retail stores, restaurants, hotels and other businesses, including the Stowe Reporter and News & Citizen.
Copley Hospital borrowed the most, at $5 million.
Trapp Family Lodge, Lamoille County Mental Health and Vermont Electric Cooperative borrowed between $2 million and $5 million.
The Stowe Reporter spoke with Jeff Herbert, chief financial officer of Copley Hospital, and Andrea Cohen, manager of government affairs and public relations for Vermont Electric Cooperative, to see how this money is helping lights stay on and hospitals save lives.
The Vermont Electric Cooperative, headquartered in Johnson, serves 32,000 customers in eight counties and, when people were stuck at home, the primary goal was to keep power going to all those meters.
“We’re a not-for-profit co-op; we’re about helping our members,” Cohen said, “There was no way we were going to go out and shut people’s power off.”
“People definitely owe us money,” Cohen said, with delinquencies about double what they were last year. More than 10 percent of accounts are overdue by a month, and hundreds are three months late.
“Our members are typically lower income, so we use every tool we can to help them,” Cohen said.
The co-op took a $2.6 million PPP loan. As a nonprofit with $81 million in annual revenue, there isn’t a lot of room for error.
“We’re trying to be proactive. We don’t want to go in and do a rate increase,” Cohen said. The co-op delayed projects and cut back on other programs to make sure it stays in the black. “Every little bit helps. We know our members are making difficult decisions.”
Hebert took his job as chief financial officer four months ago, right before the shutdown.
“You come into a new job and oftentimes the new guy has a steep learning curve,” he said. But when the pandemic hit, day-to-day business at the Morrisville hospital had to be reimagined almost overnight.
“I was learning along with everybody else,” Herbert said.
It was tough managing the hospital’s finances when its main source of revenue, elective surgery, was shut down to curb the spread of the coronavirus. At the peak, even vital services were down to 30 percent.
Copley Hospital took a $5 million PPP loan to help weather this storm. In addition, the state government has $275 million available for health care from $1.3 billion Vermont received under the federal CARES Act, helping to cover essential services.
Also, Medicare is propping up clinics and hospitals, issuing an advance on what they would usually claim. Herbert said he didn’t know exactly how much that would be, but it’s more than the $5 million the hospital borrowed through PPP.
“This is all to make sure the hospitals can provide care,” he said. “They understand there’s a loss of those services, and they understand they were how the hospital keeps the doors open.”
The aid has been enough that Herbert isn’t sure how much of that PPP loan Copley will actually use. Elective surgery has returned, and Herbert said vital services are back to half of what they were before the pandemic and “we’re seeing it getting better every month.”
He still finds the decline concerning, because people could be skipping medical visits altogether out of fear of the virus.
“We need to make sure we’re taking care of the community and the population, but this is a scary time for a lot of people,” he said.
“The CARES Act did what it needed to do. It kept the doors open,” he said. Now it’s about people getting the services they need and making sure they know the hospital’s a safe place.