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Religious institutions receive Paycheck Protection loans

Published: Jul. 13, 2020 at 6:19 PM CDT
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BISMARCK, N.D. (KFYR) - The Paycheck Protection Program distributed nearly five million federal loans to help businesses keep employees on the payroll, including nearly 20,000 in North Dakota.

But some recipients may not be what you expect. More than half a dozen private religious institutions in the state received Paycheck Protection loans, some of them amounting to $1 to $2 million.

The Dakota Adventist Academy is one of those institutions that applied for PPP funds. According to data released by the Small Business Administration, they received between $150,000 to $350,000.

“When we read that it is was open to nonprofits and that there weren’t any strings attached, we felt more comfortable in taking and applying for the loan,” said Dakota Adventist Academy Vice President of Finance David Chapman.

In order to qualify for full loan forgiveness, businesses must use at least 60 percent on payroll costs.

David Chapman says about 84 percent of their loan went to salaries, while only 16 percent went to other permissible expenses like utility payments.

“To know that we weren’t going to have to cut paychecks or tell people that they didn’t have a job anymore was much relief to our staff,” said Chapman.

Shiloh Christian School also received a loan. Theirs equaled anywhere from $350,000 to $1 million.

The school’s superintendent estimated about 95 percent of their loan was used to keep all of their employees on the payroll through the end of June, but now they’re looking to the future.

“We’re back on, we’re paying our bills as normal. Just getting ready now for the new school year,” said Shiloh Christian School’s Superintendent Todd Benson.

State SBA leaders say these schools qualify as nonprofits and although they usually do not finance nonprofits, with the pandemic hurting all industries, that’s changed.

“There were some narrow limitations on the types of businesses that were not eligible, but for the most part any religious organization, as long as it was organized as a 501C3, would be eligible,” said state Small Business Administration Director Alan Haut.

A 501-C-3 is simply a designation from the IRS that they’re a charitable organization.

Some other private institutions across the state who’ve received Paycheck Protection loans include Light of Christ Catholic Schools in Bismarck, Bishop Ryan in Minot, Trinity Bible College in Ellendale, and Oak Grove Lutheran and John Paul the second Catholic schools in Fargo.

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