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KARE 11 Investigates: Big businesses, exclusive clubs get federal small business loans

Nearly 14,000 in forgivable loans worth at least $14 billion flowed from the SBA to Minnesota for pandemic relief, but many who got money might be unexpected.

MINNESOTA, USA — It wasn’t just mom and pop stores and restaurants that benefited from federal small business loans meant to help keep them running during the pandemic.

In Minnesota, publicly traded companies with hundreds of employees got loans. So too did high-cost private schools, casinos, exclusive country clubs, mega churches and non-profits whose CEO’s salaries reach into half a million dollars.

In total, nearly 14,000 loans worth at least $14 billion from the Small Business Administration (SBA) flowed to Minnesota, according to records released Monday. Minnesota’s employers reported that the loans affected more than one million jobs statewide.

Nationally, the Treasury Department’s Paycheck Protection Program authorized $520 billion. The loans can be forgiven if employers use most of their money to keep workers on their payrolls.

While there were surprises on the list locally and nationally, University of Minnesota Economics Professor V.V. Chari said the federal government needed to get the money out fast to help those impacted by the pandemic shutdowns.

“Certainly in terms of ensuring that the reduction in employment wasn’t as severe as it might have been, I think it was reasonably successful,” Chari said.

In Minnesota, the biggest benefactor of the loans were also some of the industries hardest hit – such as restaurants. More than 4,000 full- and limited-service restaurants received $417 million in loans affecting more than 100,000 jobs.

Some of those included chains with multiple locations, such as Davanni’s, which received at least $2 million in loans. The money was a “lifesaver” for the pizza maker that has 21 locations and about 800 employees, said President and CFO Bob Stupka.

“‘It allowed us to keep operating, keep paying our employees, keep providing benefits and keep servicing our incredibly loyal customers,” Stupka said.

Rounding out the top three industries benefited: Plumbing, heating and air conditioning contractors got at least $169 million in loans, while new car dealers received anywhere from $147 million to $345 million.

Some of the other sectors that also got help:

  • Golf courses and country clubs got at least $7.6 million in loans. Among those: the Hazeltine National Golf Club and the Town and Country Club of St. Paul, the latter of which has membership fees that start at $6,200
  • Churches and religious organizations got at least $153,680,814 in loans, including some of the largest congregations in the state, such as the Hugo-based Eagle Brook Church, which got a loan between $2 million to $5 million and boasts a weekly attendance of more than 22,000 people. [UPDATE: Eagle Brook church sent a statement on July 10 saying the church returned the loan two weeks after receiving it due to being "in a healthy financial position.]
  • About 225 Law firms got at least $161 million in loans, including some of the most prestigious in the state, such as Fredrikson & Byron, Robins Kaplan and Foley & Mansfield each getting loans between $5 million and $10 million.
  • At least six publicly traded companies received about $17 million in loans, including the Plymouth-based clothing retailer Christopher & Banks, and the Maple Grove-based electronic manufacturing services provider Nortech.


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