For Hawaii small businesses like Billy Giang’s once-budding Pho Factory restaurant chain, April truly is shaping up to be the cruelest month.

Not that March was kind: Giang watched revenues erode to nearly nothing at his three locations at Pearlridge Center, Windward Mall and the tony Royal Hawaiian Center in Waikiki.

“I’m just trying to make payroll now,” Giang says.

But the big bills are coming next month. There’s rent to pay, and more.

“I’m going to have to face my vendors in about a week and explain the situation,” said the 32-year-old Giang.

For small businesses like Giang’s help may be coming soon. On Friday, President Donald Trump signed a $2 trillion relief package that includes $377 billion for small businesses through a U.S. Small Business Administration loan program set up under what Congress is calling the Keeping Americans Paid and Employed Act.

Under the law, loan money used for items like payroll, rent and mortgage payments could be completely forgiven for up to eight weeks. In this way, the loan is more like a grant. It’s available for businesses with up to 500 employees.

The key is to keep people on the payroll, said Joe Burns, the director of the SBA’s small business development center for Oahu.

“The way I read it, it’s really about keeping people employed,” he said of the 800 plus-page measure. “That’s the linchpin.”

The idea, he said, is that the workers will resume going out, spending money and stimulating an economy that has been sent into what some say is an instant recession.

The purpose isn’t just to keep workers on the payroll, said U.S. Sen. Brian Schatz, but also to enable businesses to resume operations quickly when it’s safe to get going again.

“It would be hard for businesses to get back up and running if they are already separated from the employee,” Schatz said during a briefing with Hawaii state senators on Friday.

For entrepreneurs like Giang, the measure appears to address his most pressing issues. As the COVID-19 crisis tightened in Hawaii, Giang saw his business slowly decline.

On a good day before the crisis, Giang said, he might sell 300 bowls of pho. By early March, as travel to Hawaii declined, that dropped to more like 100 bowls. Last week, it was in the neighborhood of 20.

He could theoretically stay open, Giang said. But there was no point. The bottom had dropped out.

“We just decided that was enough,” he said.

“It’s really about keeping people employed. That’s the linchpin.” — Joe Burns, SBA on Oahu

Still, he has bills to pay: about $50,000 per month for rent for his three locations, plus another $50,000 to $80,000 for vendors. Without help, he said, starting up again after the hiatus is impractical.

“To restart a couple of hundred thousand dollars in debt just doesn’t make sense,” said Giang, who employs 25 to 30 workers, most of them full time.

Will Red Tape Deter Applicants?

While the prospect of federal assistance is encouraging to Giang, there’s a question of just how fast it can arrive.

Giang’s neighbor in Waikiki, Jesse Aguinaldo, has seen a similar drop in business. His Mahaloha Burger chain also has three locations, in Kailua and Ala Moana Center as well as the Royal Hawaiian Shopping Center. Basically all of his employees except managers are gone, Aguinaldo said, and he’s trying to stay open with a small staff through the month at least.

Like Giang, he faces a lot of bills come April. He expressed skepticism that the SBA loan program will really offer much relief. He’s used an SBA loan program in the past, he said, and the red tape was a nightmare.

“It’s a tedious process when you’re borrowing from them,” he said.

Burns acknowledged the SBA forms can be tedious. But he said the agency has centers on Oahu and neighbor islands to help.

Businesses can also apply for SBA’s low-interest disaster relief loan program, with 3.75% interest for businesses and $2 million for qualifying nonprofits. The loans are up to $2 million with 15- or 30-year terms.

People who have applied for such a loan can also get a $10,000 grant, Burns said.

“If you don’t qualify for the loan you still get to keep the $10,000, which is nice,” he said.

A main difference between the disaster relief loans and new stimulus act loans is that the disaster loans are administered by and made through the SBA, while the stimulus loans are made through local banks.

“The banks lend you the money but it’s guaranteed by the SBA 100%,” he said.

Businesses can receive both types of loans, but they cannot use both to cover payroll, he said.

Burns also acknowledged it may be hard to reach the SBA right away.

“People just have to keep trying,” he said. “We’ve been slammed. It’s just been one call after another, one email after another.”

Loans aren’t the only relief available. Small business owners might be able to negotiate deals with landlords and vendors, said Elijah Yip, a partner with Luminate Law in Honolulu. Yip said contracts and leases might have special terms, often called force majeure clauses, that provide remedies when unforeseen events occur.

But outside of the written contract, there could be other remedies, Yip said. Other legal principles — known as frustration and impossibility in legal parlance — might give people an out.

“They’re narrow, but they could very well apply to your situation,” Yip said.

The point of getting legal advice on such technical matters isn’t necessarily to fight in court, he added, but to help negotiate.

“People might actually be willing to work out something,” Yip said.

Landlords Also Have Bills To Pay

The COVID-19 crisis has engulfed businesses so quickly that many haven’t had a chance to contemplate such things. Giang said he hasn’t spoken to his landlord and vendors yet, but he said he understands they also have bills to pay.

“We can’t just stiff the landlords,” he said. “The landlords have obligations too.”

Giang couldn’t say what’s next as he surveyed the Royal Hawaiian food court, which on Thursday was lifeless except for some people working on the stone floor. All around him and downstairs the stores were closed: Salvatore Farragamo, Harry Winston, Furla. The luxury emporia that once lured wealthy tourists probably have the money to weather the storm for a while, he reckoned.

While the SBA programs sounded encouraging, he wasn’t sure he could keep his business afloat.

“I don’t think anything will help at this point,” he said.

“Hawaii’s Changing Economy”  series is supported by a grant from the Hawaii Community Foundation as part of its CHANGE Framework project.