Special Questions

Texas Manufacturing Outlook Survey

Data were collected Oct. 13–21, and 107 Texas manufacturers responded to the survey.

Did you receive a Paycheck Protection Program (PPP) loan?

NOTE: 107 responses.

What share of your PPP loan do you expect to be forgiven?

NOTES: 73 responses, though 16.4 percent responded ‘Don’t know.’ Only posed to those who reported their firm received a PPP loan.

Since the end of the PPP in August, have you tried to obtain financing?

NOTES: 73 responses. Only posed to those who reported their firm received a PPP loan.

If not, why not?

NOTES: 62 responses. Only posed to those who reported their firm has not tried to obtain financing.

To what extent is your business having difficulty obtaining financing for desired short-term uses such as paying workers and acquiring inventories of material or supplies?

NOTES: 45 responses. Was not posed to those who reported their firm has not tried to obtain financing.

To what extent is your business having difficulty obtaining financing for desired long-term uses such as capital expenditures?

NOTES: 45 responses. Was not posed to those who reported their firm has not tried to obtain financing.

How would your firm respond if you were unable to access adequate financing by year-end, either via federal assistance or other means? Please select all that apply.

NOTE: 100 responses.

Special Questions Comments

These comments have been edited for publication.

Chemical Manufacturing

• I do not believe that obtaining capital will be a challenge.

Primary Metal Manufacturing

• Our main concern is the upcoming election, and if there is a change in the presidency, the effect it will have, if any, on manufacturing. We have had steady growth over the past four years and expect it to continue unless an increase in taxes and spending by the government curtails it.

Fabricated Metal Manufacturing

• We are hoping PPP [Paycheck Protection Program] loans are forgiven as our banker is alluding—at least that is a big step toward getting back on the right track.

Machinery Manufacturing

• It’s hard to eat ribs when the meat is already gone. We are at the bottom of operations now.
• We’ve cut back substantially after the PPP ended. We are now operating with our key people with minimum business opportunities. Our next cutback will really hit the bone hard. But we are doing a great deal better than our competitors because we vertically integrated years ago. No one else did, and they are paying the price now. But that doesn’t mean that we are doing well—just that we are going to survive this pandemic.

Computer and Electronic Product Manufacturing

• It would be great to see some progress toward another round of stimulus or to at least have a better feeling of if such an event were a probability rather than a possibility. However, a bigger looming factor is the IRS decision to not allow deductions for expenses paid by PPP funds. That appears to be against the intent of Congress in passing the bill and, frankly, creates additional uncertainty in planning and understanding our true cash requirements. In addition, knowing the tax consequences before choosing to participate in the loan program would have been helpful. The IRS position is opposite of what we were led to believe when choosing to participate. Right now, we don’t know if we will, in essence, be taxed on those loans nor whether additional help will be available. To sure up things for small business and reduce uncertainty, Congress needs to take care of the items that are in their control. The political environment is caustic, and small business deserves answers and action, not rhetoric and inaction.
• We do not need immediate financing, but if we did, we would trim expenses appropriately starting with the operating expenses.

Transportation Equipment Manufacturing

• Trying to access SBA [Small Business Administration] disaster loans has been frustrating and futile.

Printing and Related Support Activities

• This has not been an issue, as being a producer of packaging for consumer goods and institutions, demand has been robust but erratic.
• PPP was a huge benefit for us and our employees, and we will apply for it again if it is offered.

Texas Service Sector Outlook Survey

Data were collected Oct. 13–21, and 272 Texas business executives responded to the survey.

Did you receive a Paycheck Protection Program (PPP) loan?

NOTE: 264 responses.

What share of your PPP loan do you expect to be forgiven?

NOTES: 141 responses, though 13.5 percent responded ‘Don’t know.’ Only posed to those who reported their firm received a PPP loan.

Since the end of the PPP in August, have you tried to obtain financing?

NOTES: 141 responses. Only posed to those who reported their firm received a PPP loan.

If not, why not?

NOTES: 115 responses. Only posed to those who reported their firm has not tried to obtain financing.

To what extent is your business having difficulty obtaining financing for desired short-term uses such as paying workers and acquiring inventories of material or supplies?

NOTES: 149 responses. Was not posed to those who reported their firm has not tried to obtain financing.

To what extent is your business having difficulty obtaining financing for desired long-term uses such as capital expenditures?

NOTES: 149 responses. Was not posed to those who reported their firm has not tried to obtain financing.

How would your firm respond if you were unable to access adequate financing by year-end, either via federal assistance or other means? Please select all that apply.

NOTE: 232 responses.

Special Questions Comments

These comments have been edited for publication.

Air Transportation

• [We] received airline PSP [Payroll Support Program] instead [of Paycheck Protection Program support].

Pipeline Transportation

• The biggest impact [will come from] global petroleum demand.
• Access to capital was a real issue for some high-yield issuers early in the year, particularly energy issuers. That seems to have eased somewhat, but energy as a sector is still highly disfavored, and access to capital remains a concern over the long term.

Warehousing and Storage

• Currently, we are well-capitalized and have access to an as-of-yet-untapped $150 million line of credit, so we do not expect to be forced to slow down either [our] operations or capital expenditures.

Data Processing, Hosting and Related Services

• The company's attorneys and accountants recommended not to take PPP due to many unknowns about the PPP during the spring, and instead apply for traditional forms of financing, so we applied for and received a bank line of credit to weather what may come.

Credit Intermediation and Related Activities

• We currently have no liquidity concerns.
• We have found a bank (finally) that is using the MSLP [Main Street Lending Program] and are trying to get a working capital loan through them. While we have plenty of cash, it is securing another debt facility, and we cannot access it. We have also been working for about four months on an SBA [Small Business Administration] 504 loan to permanently refinance our facilities and equipment.

Securities, Commodity Contracts, and Other Financial Investments and Related Activities

• [We are] just keeping the doors open! 

Real Estate

• If President Trump is reelected, our economy will be great. People want to hire and open their businesses.
• We have access to financing, and the rates are favorable. Some long-term money is a little higher, but all rates are so low that it doesn’t matter. What matters is being able to collect rents and make mortgage payments. With no government interference in the business or legal process, we feel we can be OK, and our tenants seem to be doing better as well.

Professional, Scientific and Technical Services

• Since PPP ended, we have had to reduce salaries for certain staff. If PPP were to continue, those staff salaries could be increased to previous levels.
• The current administration needs to be thanked big time by small business like ours. They came with PPP loans very fast. Plus, we also got an SBA small business loan. We could not get loans from commercial lenders, and these two loans for us in our case saved [us] from needing to do any downsizing or staff layoffs.
• We are growing back revenue after COVID-19, and the business climate is looking a lot better in the U.S. as well as worldwide.

Administrative and Support Services

• The COVID-19 experience has been very difficult. We are pleased that it seems to be going away.
• While my business of luxury travel will be the last to rebound in the future, it impacts so many areas of our economy. The lack of D.C. support is telling on how we are really on our own versus what we see from less-prosperous nations around the world who are supporting their economy in better fashion.
• As business improves, it is measured from the absolute low established in April through August. We remain unprofitable now and are funding the business in part from EIDL [Economic Injury Disaster Loan] proceeds, which is not sustainable. The PPP funds have been spent. We need legislation to remove the taxability of forgiven PPP loans.
• The lesson learned from prior downturns is losing employees complicates the recovery effort. We strive to avoid reductions in force absent a critical or unavoidable issue. While revenues have declined slightly year over year, the reduction of operating costs resulting from quarantine has exceeded the loss of revenue. PPP served to bridge the timing of working capital and allow for retention of all employees.
• I qualified for a disaster loan, and the funds will allow me to continue operations until first quarter 2021.

Ambulatory Health Care Services

• Financing is not specifically critical. We face decreased revenue, decreased reimbursement and increased cost of goods due to COVID-19.

Museums, Historical Sites and Similar Institutions

• Our board would demand that we shut down completely [if we were unable to access adequate financing by year-end], but since we care for live animals, a complete shutdown is not feasible.

Amusement, Gambling and Recreation Industries

• We are fortunate to have some money to fall back on, but to prevent the speedy draining of our reserves, we have already done [many things] except temporarily or permanently shutting down.

Food Services and Drinking Places

• I did apply for the Main Street Loan with my bank, and I did not qualify. They told me I only qualified for $247,000 and the minimum should be $250,000. I was disappointed and sad because I had a project to buy a pizza franchise with this loan.
• Financing is not an issue for us. Finding employees who want to work is our major issue. High weekly unemployment benefits are encouraging people to stay home versus go out and work.

Texas Retail Outlook Survey

Data were collected Oct. 13–21, and 51 Texas retailers responded to the survey.

Did you receive a Paycheck Protection Program (PPP) loan?

NOTE: 50 responses.

What share of your PPP loan do you expect to be forgiven?

NOTES: 30 responses, though 6.7 percent responded ‘Don’t know.’ Only posed to those who reported their firm received a PPP loan.

Since the end of the PPP in August, have you tried to obtain financing?

NOTES: 30 responses. Only posed to those who reported their firm received a PPP loan.

If not, why not?

NOTES: 26 responses. Only posed to those who reported their firm has not tried to obtain financing.

To what extent is your business having difficulty obtaining financing for desired short-term uses such as paying workers and acquiring inventories of material or supplies?

NOTES: 24 responses. Was not posed to those who reported their firm has not tried to obtain financing.

To what extent is your business having difficulty obtaining financing for desired long-term uses such as capital expenditures?

NOTES: 24 responses. Was not posed to those who reported their firm has not tried to obtain financing.

How would your firm respond if you were unable to access adequate financing by year-end, either via federal assistance or other means? Please select all that apply.

NOTE: 42 responses.

Special Questions Comments

These comments have been edited for publication.

Motor Vehicle and Parts Dealers

• The election will negatively impact the business climate if Biden wins.
• We don’t anticipate having to take any actions [in response to lack of access to financing].

Building Material and Garden Equipment and Supplies Dealers

• The PPP was a lifesaver for our company, as it allowed us to keep all our employees and actually hire a few more qualified people who were laid off in our industry, even though our sales suffered because of the shutdown (or slowdown depending on what you want to call it).