Earlier this month you might have heard about famous burger chain company, Shake Shack, and how they returned the hefty $10 million loan they received from the U.S. federal government. The Los Angeles Lakers have just done the same thing with the same exact loan they received, announcing in a statement that they had returned $4.6 million back to the government. This was first reported below by Kevin Arnovitz and ESPN.
Among the high-profile companies who received millions in the first round of PPP funding — the Los Angeles Lakers. They returned the money once reports surfaced of large companies crowding out smaller businesses at the trough.https://t.co/MAFQ5tMDEo
— Kevin Arnovitz (@kevinarnovitz) April 27, 2020
As stay-at-home orders are continued in response to the worldwide coronavirus pandemic, many small businesses throughout the U.S. have had to close their businesses due to a lack of consumers using their business in these times. The U.S. government responded with the CARES Act, which was intended to give loans to the small businesses that need it most to cover the bare minimum costs to run their business. The $2.2 trillion fund was actually depleted quickly from the large number of applicants, causing the Lakers to return theirs. That is the reason that the Lakers’ organization lists below in their official statement (from Kevin Arnowitz’ story on ESPN):
“The Lakers qualified for and received a loan under the Payroll Protection Program,” the Lakers said in a statement to ESPN. “Once we found out the funds from the program had been depleted, we repaid the loan so that financial support would be directed to those most in need. The Lakers remain completely committed to supporting both our employees and our community.”
This doesn’t really have to be said, but the Los Angeles Lakers aren’t exactly a “small business”. It’s a good thing that they returned the money, as some other businesses around the nation can probably use it, but it’s interesting that they applied for the loan at all. Hopefully, the organization can continue to partner with the other teams that occupy Staples Center and fund the salaries of the many employees that use year-long sports operations to feed their families without any government funding that could be used elsewhere.