Public hamburger chain Shake Shake announced Monday that it will return the $ 10 million it received as part of the Congressional approved (and now exhausted) vote check protection program after have been criticized for obtaining funds to help struggling small businesses survive the shutdown of the coronavirus.
What are the details?
NBC News reported that Shake Shack was one of “more than a dozen companies with annual revenues in the hundreds of millions who would have received money” from the $ 349 billion loan program adopted in the part of the 2 trillion dollar coronavirus rescue program, CARES Act.
But the PPP ran out of money last week after the Democrats refused to replenish it unless additional funds are added for hospitals and state and local governments, leaving desperate small businesses unable to find a relief.
Critics and even Shake Shack executives themselves have wondered why such a large company qualified in the first place under the P3 loan program, blaming Congress for hastening legislation that had been sold as a lifeline for mom-and-pop stores.
In announcing that Shake Shack would return the funds received from the Small Business Association, CEO Randy Garutti explained:
While the program is touted as a relief for small businesses, we also learned that it stipulates that any restaurant business – including restaurant chains – with no more than 500 employees per location would be eligible. We applauded the news because it signaled that Congress had received the message that as an employer and for the vital role we play in communities, restaurants must survive. There weren’t any fine print anywhere that suggested, “Apply now, or we’ll run out of money by the time you’re finally online.”
Garutti went on to say that his company had successfully raised additional private capital last week, adding, “We are grateful for this and have decided to immediately repay the entire $ 10 million PPP loan we have received last week at the SBA. so the restaurants that need it the most can get it now. “
After Shake Shack’s announcement, billionaire Mark Cuban criticized the company on CNBC’s “Fast Money”, saying, “Shake Shack didn’t return the money because they didn’t want the money. They saw what public outcry was. “
Former US Ambassador to the United Nations Nikki Haley praised the return of funds, saying on Twitter, “Thanks to Shake Shack for remembering that we are all in the same boat.”