After the CARES Act passed on March 27, restaurant owners quickly worked to file the paperwork to apply for the Paycheck Protection Program, a forgivable loan meant to enable small businesses to continue paying their staff. Businesses who use the funds for basic operating expenses, such as rent, utilities, and payroll, can have 100 percent of the loan forgiven. However, the process hasn’t been easy for everyone, and the first round of funding has already run out. We’re asking a series of business owners if, how, and when they got their loans, and how they plan to use them. Patrick Whalen of 5Church has been vocal about his frustration with Bank of America’s radio silence on the status of loans for his five restaurants, including 5Church and Sophia’s Lounge in Charlotte. —Kristen Wile

Unpretentious Palate: When did you actually get your application in?
Patrick Whalen: That’s kind of a tricky question, because we had the initial SBA application that was available online done, I if I had to guess, it was the last week of March. Then, when it came time to actually apply with your bank, the portals opened up for some of the banks on April 3rd, which was a Friday. Bank of America was one of them. Bank of America is my bank and they were having problems. There were glitches in the system. They were only allowing people with all kinds of specific criteria that the SBA was not asking for, but they were asking for. They got a big PR black eye out of that. So I submitted on the 3rd and then since then, it’s been a lot of resubmitting and resubmitting and resubmitting again.

UP: What has the communication been from Bank of America? Do you know for a fact that you’re not getting funds, or do you think there’s still a chance that your application went through?
PW: I have no idea where we’re at with Bank of America. In fact, I emailed twice over the last four days writing pretty sharply worded emails, just like, ‘What is this? Is this a joke? I don’t understand what the process is here, I don’t get what’s going on.’ It seems to me when somebody wants to accomplish something, they take proactive measures. I have lots of friends that use small banks rather than larger banks and their experience was radically different than what my experience was. And so I actually ended up going through a smaller bank because I was so unhappy with Bank of America’s experience. And we have been successful with one of our stores, — well, I shouldn’t say that — it looks like we’re successful at one of our stores. Until the funds hit the account, I guess it doesn’t really count. It was an extremely difficult process with virtually no communication and a lot of work done by me and by other people that were applying with very little sort of guidance or response.

UP: So you applied for each location individually?
PW: Yeah. They’re all individually owned and operated. It’s different partners for each restaurant.

UP: Which location was the one that you think is going to go through?
PW: I’d rather not say that. I just basically set up duplicate applications. I read online somewhere, Reuters or somebody, that said if you’re not getting through to your bank, hedge your bets and file with somebody else, and so I said, OK, to hell with this. And I did.

UP: So at this point, was it safe to say that you only anticipate getting money for one location?
PW: If the PPP fund is not reloaded by Congress, then yes. I would anticipate one of our locations getting funded.

UP: How do you plan to use the money you get in that location?
PW: You fill that out when you fill out your application. I think you use a minimum of 75 percent for staff and then 25 percent for a mix of rent and utilities and some other stuff. So my intention is to follow those general guidelines as closely as we can.

UP: What does this mean for the stores that didn’t get the money?
PW: This is really important: I think I have a unique perspective here because we were very fortunate that we were in, I’m not going to say a great position financially, but we were in a good position cash-wise before this all started. Not enough to last forever, but there have been plenty of times in the history of my company where we didn’t have as much cash on hand as we had running up to this. And so as a result, you know, we are in a position where we can kind of stretch things a little bit further than if there weren’t any options, if you were really short on cash. Most of the guys I know that are in this business have cash for a month at best to keep the place going and not making any money.

We’ve since blown past the month timeline. I think a lot of people were really hanging their hats on support or some sort of relief. I think the stat that I saw this morning was that four and a half percent of all small businesses nationwide actually received SBA loans via the PPP program. I mean, that’s just a disaster. I’m not sure the program is a disaster; it’s just either the money is not getting where it’s intended to go, or there’s not nearly enough of it. So I’m thankful that we were in the position we were in economically before this started. And I’m thankful that at least one of our businesses got something it looks like.

UP: How many staff members did you have to lay off when all this happened?
PW: We did two rounds, the first round was 185, and the second round was 85 and we still have like ten people on staff total between all of us.

UP: How did it feel to see the news about how much money companies like Ruth’s Chris got?
PW: It’s hard. I don’t know what their business structure is. That could be 20 stores. So I honestly don’t know. Frankly, it’s not really any of my business. My concern is my stores and trying to make sure that I can get my people back on payroll as soon as possible, because the idea of them not having jobs is sickening.
These people didn’t lose their jobs because they did something wrong. In fact, they were doing so many things right. 5Church Charlotte had just won Restaurant of the Year with the Regional Visitors Authority. We were putting up record numbers every month. These people didn’t do anything wrong. And to tell them that they don’t have a job anymore just so they could collect unemployment, that was a heartbreaking day for me, for them.

It was just awful. So the faster I can get them back on payroll, the better. And the more of them I can get back on payroll, the better.

Q: What happens to your restaurants if more funding or enough funding isn’t approved?
UP: I’m going to have to be very creative in terms of how we stretch our cash, and be very careful about what we are spending money on. Not that we’re not doing that already. We are excessively. But we’re lucky because we worked out good deals with our landlords; we have great landlords, The Krueger brothers own the Ivey’s Hotel that’s right above us in Charlotte, they’ve been great. We’ve worked some deals with our vendors and tried to come up with some sort of cooperative relationship with them. This affects everybody equally. So there’s no bad guys, no good guy. I’m not a bad tenant or a bad creditee. It’s just a crisis like we’ve never seen. So I think if push comes to shove, we’re going to have to continue to find creative ways to save money even more than we’ve already done. And I’m not sure what that looks like yet, but I think people have an amazing ability to adapt to the circumstances they’re presented with. So we will continue to try to do so.

Q: What percentage of restaurants you think will make it through this in Charlotte?
PW: That’s got so many variables. It’s you know, whether PPP’s done or if they do another round of funding. That ostensibly doubles the number of accounts that have received something, so they go to 10 percent, leaving 90 percent out in the cold. That’s a lot of restaurants that have no backup plan. Thousands. If you partner that with a really protracted delay, which as much as we all might not want, that’s probably what’s necessary. I’m not a scientist and I’m not a politician. I don’t care. But to have a safe environment where people can actually go back to a restaurant and eat in a group, we’re a ways away from that still.

I lived through 2008-2009 in New York City during the recession, and I remember just every couple days, you wake up and you read the paper, some restaurant that you’ve heard about for 50 years closed. That was over a one and a half year period. This is like cardiac arrest for the entire system. I think that this funding was really the last chance for a lot of people. And without it, you’re going to see places start going down with frequency. I really hope I’m wrong, and I hope I don’t sound cavalier, because these are my friends and it’s devastating to think about anybody losing their business, especially if they were performing well before this and just were put in this untenable situation, If you’re looking for a percentage, if this goes for if this goes for another three months, if 75 percent of restaurants in Charlotte are still standing after that, I’ll be impressed. If it goes longer, then it’s going to start going off I think even more precipitously.

UP: When restaurants reopen, how do you think things fundamentally change in the way restaurants are run?
PW: It’s so many different things. This first is just seating capacity. How you seat the restaurant is going to be the first thing necessary to make people feel comfortable. We like to pack them in, in the restaurants. I don’t think that I’m alone in saying that. I’m not sure that’s going to be a viable option for a while. If you’ve got a 100-seat restaurant and you’re used to doing 200, 250 covers on on a Friday or Saturday night, 250 people, I think you go ahead and knock that number down by 30 percent at least to make sure that you’ve got adequate spacing between people so they feel comfortable in your store while they eat.

UP: A lot of restaurants were toying with doing takeout and delivery and and kind of unsure what to do. You started carry-out and delivery after a temporary closure. Did getting PPP money influence what you’ll do?
PW: We did some math and we figured out a way we could do it where ostensibly we were breaking even or losing a little bit of money each week. But we felt it important to keep our name out there and make our customers happy. Basically, our concerns were as follows: First is that we could have a safe work environment. That was our number one concern. We didn’t really know a month ago how bad this was or a whole lot about it. I think with social distancing, it’s easier to understand what the needs are in terms of public health and what steps that we can take as a business to facilitate that process and make sure our staff is safe and our customers are safe.

Once we felt comfortable with that, then we kind of had to look at it economically and say, how do we make this work? Because we really wanted to offer it, but we also knew that it wasn’t going to be much of a money maker for us. We looked at a bunch of different recipes and tried to figure out what people were going to want. We narrowed it down to a relatively limited menu that it wouldn’t take a whole lot of manpower to produce. And we’re offering that now.

If we make a little money, lose a little money, or break even, I’m happy with that because it puts our name out there and keeps us relevant. And when this is all over, we’ll hopefully still be standing and be in a position to relaunch. People didn’t forget about us, I hope.

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