When one economic disaster is followed by another, does anyone qualify for the SBA economic injury funds?
The Sisters of the Valley are asking.
Merced, California, March 24, 2023 (GLOBE NEWSWIRE) — Just before the turn of the year, the same bookkeeping year that the pandemic ended, the floods and mudslides began in California. They continue to this day. By early February, businesses across California were realizing the hit to sales that came from this new disaster, and the Federal Government was setting aside recovery funds, knowing that the floods and mudslides could be the death knoll to many small California farms and businesses.
The Sisters of the Valley watched their sales fall to 50% pre-pandemic numbers because of that first economic disaster, and then when the floods came, they watched the sales plunge further, in the opposite direction of where they were headed. The Sisters of the Valley were given substantial help by the SBA in the form of low-interest loans in order to survive the pandemic. They qualified, based on a healthy pre-pandemic profit and a substantial payroll history.
Because the recent floods and disasters happened before the business could recover from a pandemic economy, they are now being locked out of further help. And Sister Kate is wondering if this is happening to everyone in California. “There hasn’t been enough time between the pandemic ending and the floods hitting, for small businesses to recover. Big businesses can take the hit, but small businesses don’t have the reserves.”
The weed-nuns have a global name, they make excellent products, they have been operating for nine years through much adversity, and they managed to survive the pandemic, managed to maintain staff, and were just crawling to break-even, when the floods and mudslides hit. Their activism is fueled by the jobs they have making salves and tinctures and mushroom coffee.
When the Sisters approached the SBA for help in early February, they were expecting equal assistance as they had for the pandemic, since sales fell equally as a percentage. Three weeks later, they were asking for only ten percent of the help received during the pandemic. And today, they are pretty sure there is no help coming.
Sister Kate explained, “The process itself is humiliating, because they just found random reasons to deny me, at first. Accusations of misuse of funds that weren’t true. Accusations of violating the agreement with them, also not true. And finally, they landed on a reason I can’t argue with. ‘Your financials look unhealthy.’ Cannot argue with that. We just survived a pandemic.”
In the midst of all this, Fiona Ma, the Treasurer of California, and the founder of Shopify hosted a small business help seminar, where they laid out the avenues for aide. “One of the speakers was quite frank about the fact that it is the businesses with loads of lawyers and accountants are the ones that get the help from the SBA.’ For me, that was very disheartening to hear,” said Sister Kate. “In midst of a string of denials from the SBA, it made me wonder if the ‘small’ in ‘Small Business Administration’ really refers to their $50 million a year businesses and doesn’t really provide much help to the truly small.”
The latest rejection, based on weak financials leading up to the disaster, rings like a catch 22 to the Sisters. The SBA help is based on being healthy before the disaster, but there was a disaster before this disaster, and they are not looking back more than three years. For the sisters, if they had healthy financials, they wouldn’t be knocking at the door of the SBA.
Sister Kate said she is having a hard time wrapping her head around any small business having good profit and loss statements after the pandemic. She wonders if any of Merced County’s small businesses qualify, and these are the questions she would like the congressman’s office to answer.
The sisters have asked Congressman Duarte’s office to follow up with the SBA on their behalf. “During the pandemic, we had a democratic representative, whose office was swift in getting action from the SBA. Now we have a republican. I don’t know if he will fight for us like Adam Gray did,” Sister Kate said. “And we don’t know if we are being discriminated against or not. The SBA operates a bit like the Catholic Church, transparency isn’t their superpower.”
Sister Kate said you’d have to be inside the SBA to know if they are using different criteria for small companies or hemp companies or California central valley companies, for that matter, than they use for other businesses. She is aware that there are likely only a handful of qualifying businesses in the county, with the County of Merced allotted more than 27 million to disperse.
For more information about the sisters, visit their store: www.sistersofthevalley.org
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CONTACT: www.sistersofthevalley.org Sisters of the Valley (209) 500-6008 [email protected]
