Stimulus aid for 'small business' will go to some big chains

IOWA CITY, Iowa (AP) — As the federal government prepares to launch a $349 billion loan program meant to help small businesses survive the coronavirus pandemic, critics have growing concerns that some mom-and-pop shops might get squeezed out.

The Paycheck Protection Program — part of the $2 trillion relief package signed into law last week — was billed as a way to help local businesses that often form the fabric of communities retain workers and pay bills. But an expansive definition of “small business” in the law means that it will be open to much more than just Main Street shops when lenders start processing applications Friday.

Operators of name-brand hotel, restaurant and service chains and franchises with thousands of employees at locations scattered across the U.S. are eligible. Lobbyists are pushing the Small Business Administration to interpret the law generously to help sectors devastated by mandatory business closures and stay-at-home orders, possibly making the aid available to international fast food and lodging giants and allowing individual owners to get around a $10 million cap on loans.

While Congress could approve more money later on, the program as it stands is expected to run out quickly. That could mean applicants who have the financial and legal expertise of a larger organization might be able to maximize their benefits, not leaving much for smaller businesses, especially those who wait or have problems applying.

“I’m certain that’s what’s going to happen,” said Lauren Friel, the owner of a wine bar in Somerville, Massachusetts, that has been closed for three weeks. “It makes me really angry. It’s outrageous. They are going to walk away with their pockets full of cash.”

Friel said she intends to apply Friday for around $50,000 to help her pay rent and employees who...