Courtesy of the Celt’s Facebook page

The Celt Irish Pub was Stan Penn’s longtime dream. After a career in banking, saving every penny, he retired to open the Irish pub in 2013 on the square in downtown McKinney. The Celt is a mainstay known for its live music and excellently poured Guinness, Voodoo pasta, and breakfast fry ups. They offer over 50 Irish whiskeys, and in 2019, Irish Pubs Global named it the best Irish pub in the Americas (North and South). To honor them, McKinney Mayor George Fuller named October 30 “The Celt Day in McKinney” and lit the downtown water tower up green. 

Then 2020 came, and with it, the coronavirus. Bars and restaurants were forced to close and rely on takeout and delivery, as people sheltered in place at home. Now, downtown McKinney is a “ghost town,” and it’s affecting businesses like The Celt Irish Pub. Penn has had enough. After two months of watching his business falter, and in the wake of the announcement that the CARES Act small business loan program is out of money, he is organizing a socially distanced “Save our Square” car rally on April 24 in support of small businesses. 

“We were at the top of our game,” Penn recalls over the phone. “Even in the best of times, margins are thin. People who run restaurants and pubs don’t do it to make money. They do it because they love it.” 

The Celt was hit especially hard by COVID-19 closures. Because more than 60 percent of their sales are liquor and not food, they’re considered a private club under McKinney’s city ordinance. Though local restaurants are allowed to sell cocktails, beer, and wine to-go, private clubs like The Celt are not. 

After two months without income, Penn is now staring down the barrel of rent without a loan. “This is life and death,” he says. “But we’re fighting. We’re going down fighting.” 

The CARES Act was the lifeline that Penn, owner of The Celt Irish Pub, had been waiting for because of the Paycheck Protection Program (PPP). This $350 billion package is meant to be a boon to small businesses across the country to help them keep their staff employed. Business owners were able to apply through local banks and receive up to two-and-a-half months’ worth of payroll costs.

The moment that applications opened, he was on the website applying. The site kept crashing—so many other small business owners were doing the exact same thing—but 20 minutes after applications opened, Penn’s application was finished and submitted.

The loan seems as if it’s built for Mom-n-Pop shops, local watering holes, one-location boutiques, family-owned restaurants, and the like, the kind of business that Penn runs and that downtown McKinney depends upon. It’s administered by the Small Business Administration, which defines a small company as one with 500 employees or less. 

By April 16, after approving more than 1.5 million applications in less than two weeks, SBA’s protection program was drained dry.

“I didn’t get a call [from my bank] until the day they shut down the program,” Penn says. “And it was to say we received your application but sorry, we’re out of money.”

Many other small businesses are still waiting for their banks to tell them whether they will be eligible. 

However, soon it became apparent that not all of that money went to small businesses. 

Ruth’s Hospitality Group, parent of Ruth’s Chris Steakhouse, netted roughly $20 million in forgivable loans, about $10 million more than the original cap. Based on data gathered from Ruth’s Hospitality Group’s latest SEC filings, they’ve got nearly 5,500 employees, 11 times higher than the figure in SBA’s definition of a small business. According to PPP’s guidelines, large companies like Ruth’s Hospitality Group, Potbelly’s, and Shake Shack were all eligible as long as they had 500 employees or less at any single location. They scooped up millions from PPP’s budget and leaving Penn and other small business owners feeling cheated. 

“This was not first-come first-serve,” Penn says. “We did everything right. This money would have gotten us through the next couple of months. Who’s going to believe round 2 will be different?” 

Local Profile reached out to Ruth’s for comment, but did not receive a response by press time. Ruth’s wrote in a statement to the Wall Street Journal that the loan would ensure that they emerged from this crisis strong and that they would be following all of the SBA’s loan guidelines.

Not all big chains took advantage of the loans. The CEO of Texas Roadhouse didn’t apply. Instead, he gave up his entire yearly salary of $1 million to take care of his employees.

After a few days of bad press, Shake Shack announced in an April 20 open letter that they would be returning the $10 million in forgivable loans they had received. They explained that they had applied for the loan because they’d been losing about $1.5 million in revenue a week and figured it was the best way to help their employees. The company was caught off guard when the PPP loans ran out, causing an uproar in the small business community. Seeing the response, they decided to return their entire loan “so that those restaurants who need it most can get it now.” They called for more funding for small businesses. 

It may not have happened if small businesses hadn’t started speaking up to support their interests.

To Penn from the Celt Irish Pub, a car rally is his way to do the same. It’s also one of the only avenues he has left. He has already launched a GoFundMe page and has been encouraging customers to contact Van Taylor, the U.S. Representative for Texas’ 3rd congressional district, and a former Plano resident. He’s quick to say that he fully supports social distancing and wants people to stay in their cars and drive around the square, honking their horns. He doesn’t want it to be like the rallies being held in places like Olympia, Washington, which protest the stay-at-home orders by violating social distancing rules. 

“This isn’t about COVID-19,” he says. “This is really about Congress and the big banks. They said they would help small businesses with $350 billion dollars, and it all went to the big guys. We were told a lifeline was coming and it wasn’t there.”

Alexandra Cronin

Alexandra Cronin is Local Profile's senior editor. She has been with the company since 2016. She loves great coffee, good food, and average wine.