KU Alumni Association received $600,000 COVID-19 stimulus loan, records show
The University of Kansas’ Alumni Association applied for and received a federal Paycheck Protection Program loan of $606,200 in early April, just before the COVID-19 pandemic was at its initial peak in Kansas, records show.
Like small businesses and nonprofits across the country, the Alumni Association — which operates independently from KU — suffered “abrupt” losses in its revenue streams after the pandemic took hold in March, the organization’s president told the Journal-World.
“The collective impact of lost operating revenue, significant uncertainty regarding the duration of the pandemic, and the longer-term strain on key revenue streams led us to pursue the PPP loan,” said Heath Peterson, who has been the Alumni Association president since 2015.
The sizable loan will help the Alumni Association retain more than 50 employees, including student workers, Peterson said. Part-time employees fluctuate seasonally, so the organization’s total job numbers were based on the date the application was completed and submitted. The Alumni Association has anywhere between five and 20 part-time student employees throughout the year, Peterson said.
Created in March as part of the federal CARES Act stimulus package, the PPP provides small businesses and nonprofits with under 500 employees funding to pay up to eight weeks of payroll costs, including benefits, and is administered through the Small Business Administration. The money received can also be used to pay interest on mortgages, rent, and utilities.
In some cases, the loans can be fully forgiven. That’s based in part on whether employers retain or quickly rehire employees and maintain salary levels.
Peterson said the Alumni Association has taken other steps than the PPP loan to mitigate the financial impact brought on by the COVID-19 pandemic, including an indefinite hiring and salary freeze and salary reductions for himself and two other executives.
In 2018-19, the Alumni Association operated on a roughly $6.72 million budget while bringing in $9.45 million in revenue, according to its annual report. Peterson said the organization is planning for a 20% to 30% budget reduction in fiscal year 2021 due to the pandemic.
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