Staff Photo by Matt Hamilton / Owner Kelly Hailey at Pigtails and Crewcuts on the North Shore. Hailey was able to get two rounds of Paycheck Protection Program funding to keep her business going through 2020 and early 2021. The program ran out of funding in the first few days of May, though the deadline for applications had been set at May 31.

Most of their clients made it in under the wire, but some business owners are left wondering if they'll get Paycheck Protection Program funding after the money dried up nearly a month ahead of the application deadline of May 31.

"We were getting information from the Tennessee Bankers Association about how much money was left and how close it was getting, so we put a hard stretch to tell our clients, 'You'd better hurry,'" said Kenny Dyer, market president for Pinnacle Bank in Chattanooga. "I will admit I was a little surprised to see how quick the money was drying up."

Pinnacle Bank made $77.6 million in loans to more than 600 local businesses in the most recent round of funding. About 40 clients appear to have missed their shot at funding because of the program's abrupt end, with three or four of those in the Chattanooga market, said Pinnacle spokesperson Joe Bass.

"The good news is the [Small Business Administration] told us they had set aside enough funds to cover applications that were in their hands," he said. "I'm not sure if that's going to work out, but yesterday we had an application that had gone back and forth I think 15 times, and they finally approved it."

George Wilson, who owns Southern Payroll & Benefits, said he had put in two applications for clients on the day the program ran out of money. He has about six clients that aren't sure whether they made the cutoff, Wilson said.

"It's just so ambiguous right now," he said.

The massive rescue program for business hit by pandemic losses has sent nearly $800 billion in potentially forgivable federal loans to U.S. business since it launched a little more than a year ago.

Paycheck Protection Program snapshot

* Forgivable federal loans through the Paycheck Protection Program originally included $349 billion in funding, but that money was gone within two weeks of applications opening in April 2020.

* A second round of funding for $320 billion wasn’t depleted, but applications closed in August.

* Applications for the most recent round, this time with $284 billion in funding, were initially open through March 31, but the deadline was extended to May 31.

* That funding ran out in the first week of May.

* At the end of 2020, more than 5 million businesses in the U.S. had tapped $522 billion in the stimulus funds, including more than 99,000 businesses in Tennessee and more than 169,000 in Georgia.

* When it concluded in May 2021, the program had distributed nearly $800 billion in forgivable federal loans.

Though the Paycheck Protection Program has run out of funds, there are still critically important rescue programs available specifically for restaurants and entertainment venues, which were particularly hard hit, said Jay Dale, the market president for First Horizon in Chattanooga.

"I have heard several customers apply and get significant money from those programs," Dale said. "I would still encourage people to apply for those."

First Horizon made about $50 million in loans through the second round of the Paycheck Protection Program, he said, and now a lot of attention is shifting to the forgiveness process.

"We had been asking for customers to be patient through March and April because we felt like there would be more clarity on the process for forgiveness, and they did ease the requirements for loans under $150,000," Dale said. "Now we've sent out invitations to the vast majority of customers saying you don't have to wait anymore."

Kelly Hailey, who owns two Pigtails and Crewcuts businesses in Chattanooga, received funding in both rounds of the program. The money was the only way her business made it through the pandemic, she said.

"We would have had to close without it," she said. "There's no doubt in my mind."

Round 2 of the Paycheck Protection Program

* Businesses had to show a 25% quarter-over-quarter revenue loss.

* Restaurants and other hospitality businesses could multiply their average monthly payroll costs by 3.5, making them eligible for more funding.

* Second-time PPP borrowers could qualify for a second loan if they had used up their first PPP loan and had fewer than 300 employees — down from 500 in earlier rounds of funding.

Her total loans come in under $150,000, so she will have a simplified forgiveness process, but she hasn't started it just yet, Hailey said.

(Read more: The price of a pandemic: Scenic City businesses grapple with seeking stimulus loan forgiveness, pursuing more aid.)

"That's definitely in the back of my mind, tracking it and how I'm spending it," she said. "I'm feeling some pressure to make sure I get it off my plate."

Loans from the first round of funding that haven't been approved for forgiveness will start coming due for repayment in August, Bass said.

"Just below 70% of first round applications [among Pinnacle clients] have started the process," he said. "Deadlines are going to be coming up. There's no more reason to wait."

Wilson said he has sought forgiveness for his loans for Southern Payroll & Benefits, and is helping clients do the same.

"I'm encouraging clients, let's go head and get your forgiveness done," he said.

Contact Mary Fortune at or 757-6653. Follow her on Twitter @maryfortune.