Changes to federal COVID-19 relief loan program offer ‘ease of mind’ for small Alaska businesses

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Alaska tourism operators who lost much of their business during the COVID-19 economic crash say recent updates to a federal relief loan program should help them hobble by this summer, despite a plunge in bookings.

“It gives us flexibility,” said Tom Tougas, co-owner of Harbor 360 Hotel in Seward and Major Marine Tours, a wildlife cruise ship operator in Resurrection Bay.

“With the changes, it’s pretty much guaranteed that we’ll get our PPP loan forgiven,” said Mandy Garcia, co-owner of Salmonberry Travel and Tours in Anchorage, providing guided shuttles around the region.

“That’s huge. It’s ease of mind," she said.

The changes to the Paycheck Protection Program, signed into law by President Donald Trump on Friday, extend the loan’s forgiveness period to nearly six months from two months, among other steps.

The loan doesn’t need to be paid back if it is properly used to cover payroll and other basic costs like rent.

Another change allows recipients to use a greater portion of the loan to cover rent, utilities and mortgage interest and still receive forgiveness. Recipients also can repay portions of the loan that aren’t forgiven over five years, instead of two years.


[Rent and mortgage relief available for Alaskans struggling to make payments]

The program, launched in early April, has provided more than $500 billion in loans nationally, according to the Small Business Administration.

About $130 billion still remains available for small businesses to tap, the agency said Saturday.

In Alaska, $1.2 billion has been approved for more than 10,000 businesses.

Alaska has about 70,000 small businesses. Many firms could potentially still access the Paycheck Protection Program loan, said Jon Bittner with the Alaska Small Business Development Center.

The extension should be helpful in Alaska, Bittner said.

“The economic downturn is going on longer than expected,” he said.

Among other benefits, tourism companies will be able to use the loan on payroll costs through the entire summer season, a period that traditionally provided most of their yearly income, he said.

Bittner said the extension of a PPP loan isn’t necessarily automatic.

Businesses will need to work out the details of the extended forgiveness period with the lending institution that provided the loan, he said.

He also said small businesses in need of aid should first tap into Alaska’s $290 million COVID-19 relief grant program, launched this month.

Businesses that have already received federal aid are not eligible for the state program.

But businesses that receive the state grant first can then get federal aid or municipal grants.

“Do the state program first and everything else is on the table,” he said.

Alaska tourism companies say the changes to the loan program will help them cope with rough times ahead.

[Alaska has reopened, but many Anchorage restaurants and residents are still relying on to-go and delivery]

Tougas, out of Seward, expects that business at the wildlife cruise and lodging operation will be down about 80% this year after cruise companies canceled their voyages.


He has refunded more than $500,000 in bookings, he said.

But he received the federal loan in late April, helping him keep his staff of about 70 employees on board. When business was dead, he kept people busy with odd jobs such as painting rooms and landscaping.

“The loan was a bridge to carry our employees from March into June," he said Tuesday. “We fortunately now have some income coming in from tours and hotel bookings by Alaskans.”

With the changes, he can use the loan to help cover payroll costs into the fall, months longer than previously allowed, and still have those loan expenses forgiven.

The ability to apply a greater portion of the loan to utility bills, and receive forgiveness for those costs, will help businesses in small towns like Seward where electricity and heating costs are high, Tougas said.

Salmonberry Travel and Tours received the federal Paycheck Protection Program loan in early May, helping keep about 10 employees paid. The loan is like "bubble gum” that’s plugged a big hole in a boat, Garcia said.

“We were at the point where we were literally taking things one day at a time,” she said.

Repaying the loan, even with its low 1% interest rate, could have been devastating after a slow summer, she said.


With tourism shut down during the COVID-19 closures, she’s used her tour vans to deliver groceries and Food Bank meals for seniors. It’s a new service that has helped the company get by, she said.

On Tuesday, the company provided its first tour of the season to clients who wanted to see Anchorage.

She’s implemented extra COVID-19 precautions, including screening clients with temperature checks and health questionnaires. Face coverings are required, and tourists without them will get face masks made by her mother.

“At this point, we’re doing our best to get through 2020 and get 2021 on the books,” she said.

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Alex DeMarban

Alex DeMarban is a longtime Alaska journalist who covers business, the oil and gas industries and general assignments. Reach him at 907-257-4317 or