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Tag: Luke Bernstein

PA business leaders applaud State Senate’s approval of permitting bill

Following up on the collective letter forwarded Monday by more than 60 Pennsylvania chambers of commers, employer associations, and labor groups, the Pennsylvania Senate on Wednesday approved important permitting reforms aimed at streamlining and expediting the state’s much-criticized permitting process. 

Sponsored by Sens. Kristin Phillips-Hill, R-York, and Greg Rothman, R-Cumberland/Dauphin/Perry, Senate Bill 350 requires state agencies to implement an accessible website so permit applicants can check the status of their application in real time.  

The bill also requires permits to be publicly accessible and if turned down, the legal authority the agency relied on must be stated. In addition, the legislation requires that a permit, license, or certification is considered approved by the state if the agency reviewing the application misses its statutory deadline. 

Greg Moreland, state director, NFIB-Pennsylvania, said Bill 350 would “provide certainty and clarity which is critical for small business owners.” 

Robert Bair, president of the Pennsylvania Building and Construction Trades Council AFL-CIO, called the measure “an important step in streamlining the permitting process so that we can start the projects that will propel Pennsylvania into the future.” 

Gov. Josh Shapiro signed an Executive Order on Jan. 31 seeking to reduce permitting delays by creating the Office of Transportation and Opportunity and the Economic Development Strategy Group in the governor’s office. 

Bill 350 looks to build on the governor’s actions by establishing a program for third-party review of permits and a resolution to delays in permit decisions. 

A report from Pennsylvania’s Independent Fiscal Office released earlier this month revealed that wage-earning groups were leaving Pennsylvania for pro-business states, Florida and North Carolina among them. 

“We are losing Pennsylvanians to other states at an alarming rate,” Phillips-Hill said in a statement. “This is not a Democratic or a Republican problem, this is a Pennsylvania problem that requires commonsense solutions that have been successful in other states. 

“Regardless of partisan affiliation, I think this is an area we can all agree on: No one wants to lose residents and businesses because they are hitting dead ends within their own state government.” 

Rothman said residents expect their state government to be efficient and responsive. 

“With this bill, we send the message that Pennsylvania is serious about growing the economy, attracting job-creators, and reforming government for the benefit of all Pennsylvanians,” said Rothman. 

Luke Bernstein, president and CEO of Pennsylvania Chamber of Business and Industry, said there is a generational opportunity to advance a significant permitting reform bill that would lead to an increase in jobs, transparency, and a more robust economy. 

“Senate Bill 350 takes a giant step forward propelling our state to become more competitive,” said Bernstein. “By building on the governor’s efforts to improve permitting, this measure further helps to modernize, streamline, and add much needed transparency to the permitting process. The PA Chamber is proud to support Bill 350 and be part of the solution that will help Pennsylvania become more competitive.” 

David Taylor, president and CEO of the Pennsylvania Manufacturer’s Association, urged the state’s regulators to “move at the speed of business and serve as partners in compliance” to improve the state’s economy.

Shapiro signs executive order committing to creating economic growth

Gov. Josh Shapiro signed an executive order Tuesday creating the Pennsylvania Office of Transformation and Opportunity within the Governor’s Office and the Economic Development Strategy Group. 

The two offices will seek to create a unified strategy for economic growth and development, with a focus on disadvantaged and underserved communities. 

The Office of Transformation and Opportunity will help develop and lead an overall growth strategy and implement economic development projects – coordinating with Commonwealth agencies, expediting permit reviews, and ensuring the speed of business review and approval of key incentive programs. 

Rather than require business to go to multiple agencies for permits, approvals, and funding, the office will serve as a one-stop-shop to cut through red tape, bring state agencies together, support the growth of state businesses, and encourage out-of-state businesses to move to Pennsylvania. 

Pennsylvania business leader and entrepreneur Ben Kirshner has been named by Shapiro Chief Transformation and Opportunity Officer. 

The Economic Development Strategy Group will be driven by the Chief Transformation Officer, and will be chaired by the governor, consisting of the Chief Transformation and Opportunity Officer and the Secretaries of Labor & Industry, Community and Economic Development, Transportation, Agriculture, Education, and Environmental Protection. 

The group will advise Shapiro on economic development projects and processes to attract and retain employers, recruit innovation leaders, and create good-paying jobs in Pennsylvania, particularly in underserved communities. 

Shapiro said in a statement he’s heard from state business and labor leaders that government needs to work more quickly. He said Tuesday’s action makes clear that Pennsylvania is open for business and is looking to be an aggressive leader when it comes to economic growth, job creation, and innovation. 

“My administration will connect our business, our workforce, our world-class universities and research institutions, and the public sector to spur economic development, particularly in communities that have too often been left behind,” Shapiro said. “By helping businesses that are already here, encouraging new ones to move to Pennsylvania, and investing in our workforce, we can create real opportunity and build an economy that works for everyone.” 

Kirshner stated that Tuesday’s executive order signals the Shapiro Administration’s willingness to create transformational change in Pennsylvania. 

“Businesses of all sizes have been asking for economic development to be a focal point in his administration,” said Kirshner, “and (Shapiro) answered their calls by creating the Office of Transformation and Opportunity.” 

Acting Secretary of the Department of Community and Economic Development Rick Siger said he looks forward to partnering with the Office of Transformation and Opportunity. The goal, said Siger, is “to support Pennsylvania businesses and workers and maximize the opportunity to attract game-changing economic development projects to our Commonwealth.” 

PA Chamber President and CEO Luke Bernstein said “regulatory and permitting reform continue to be among the critical issues that businesses would like to see addressed.” 

A long-standing deterrent to business investment in Pennsylvania has been the state’s slow permitting process and uncompetitive tax structure.  Recent reforms to Pennsylvania’s Tax Code – including the reduction of our Corporate Net Income Tax rate from 9.99 percent to 4.99 percent by 2031 – and Tuesday’s executive order look to make Pennsylvania more competitive and incentivize economic growth. 

Pa. business, education leaders look forward to cooperation with Shapiro, Fetterman

Praise for the winners and optimistic glances to the future figured in the fallout from last week’s victories by Josh Shapiro in the Pennsylvania gubernatorial race and John Fetterman for a seat in the U.S. Senate. 

Pennsylvania Chamber of Business and Industry President and CEO Luke Bernstein and Pennsylvania State Education Association (PSEA) president Rich Askey extended congratulations and extolled the virtues of both men in the aftermath of the 2022 Midterm elections. 

“The PA Chamber congratulates Governor-Elect Josh Shapiro, Senator-Elect John Fetterman, and all candidates elected to serve Pennsylvania at the state and federal levels,” Bernstein said in a statement. “We look forward to working together to move Pennsylvania and our nation forward. This election featured spirited contests across the Commonwealth, with law passionate supporters advocating for their cause and preferred candidates.” 

Bernstein said that while Harrisburg has a divided government, Democrats and Republicans have demonstrated a willingness to cross the aisle for a common good. 

“We proved through the recent Corporate Net Income tax reduction and other bipartisan initiatives, that Republicans and Democrats can come together and tackle big issues. The PA Chamber looks forward to leading the way to foster that spirit of working together.” 

Askey offered his congratulations to Shapiro and Fetterman on behalf of the 177,000 educators he represents as PSEA’s president and in a statement, pledged “to work with them to make Pennsylvania’s public schools the very best that they can be.” 

He noted that the Gov.-elect has long supported public education and Pennsylvania students. “We look forward to working with him and the Legislature to ensure our students continue to have the tools they need to succeed.” 

“Just as important, we know that John Fetterman will be a strong voice for public education in the U.S. Senate and will advocate for federal support for programs that work for our public school students and the educators and support professionals who teach and serve them.” 

Askey said that addressing crisis-level staffing shortages in Pennsylvania’s public schools is a major issue awaiting the new governor. He added that Shapiro has shown himself to be “committed to continued investments in education and to working in partnership with educators, school teachers, and families to identify strategies to recruit and retain a new generation of teachers and support professionals.” 

Shapiro’s strong showing on Election Day makes it clear, Askey remarked, that Pennsylvanians are not interested in cutting billions of dollars in public school funding and redirecting it to voucher schemes. He stated that such ideas would dismantle public schools in their communities. 

“Shapiro is very focused on ideas that work in public education,” said Askey. “Throughout the campaign, Shapiro has promised to reduce the time students spend on standardized tests, keep our schools safe, and expand access to vocational, technical, and computer training as well as other academic and extracurricular activities.” 

Many students are struggling with mental and emotional health issues and Shapiro recognizes that, Askey noted. Shapiro is expected to take measures so that every Pennsylvania school has at least one mental health professional so that children and youths needing help can obtain it.

Second-round PPP loans are moving slowly, here’s why

There’s still $147 billion available in the second round of the Paycheck Protection Program, according to a report by the Small Business Administration released on Saturday.

The second round’s $310 billion has taken significantly longer to be reserved by business borrowers after becoming available about a month ago, compared to the first round’s $349 billion, which ran out in 13 days.

So, why is that happening? Local lenders offer two reasons: federal officials instituted policies that discouraged larger, publicly-traded businesses from taking up funds that were approved for struggling small businesses; and the PPP’s restrictive requirements have made many small business borrowers reconsider accepting the funds.

The PPP provides 2.5 times monthly payroll costs to businesses with the promise of loan forgiveness so long as they use at least 75% on payroll expenses and no more than 25% on certain overhead costs. Employers would have to take on any amount that goes beyond these limitations as a 1% loan with a two-year maturity.

Approximately 35% of respondents to a May 18 survey by the National Federation of Independent Business (NFIB) said they plan to have some portion their PPP money turn into a loan instead of seeking full forgiveness.

The first round of $349 billion ran out in two weeks, with an average nationwide loan size of $206,021. The $310 billion second round has been live for approximately one month since April 27. The average round two loan size was $115,503, a $90,618 decline from the first round, as of the SBA’s May 23 report.

More than 4.4 million PPP loans totaling $511 billion have been approved as of May 23, according to the SBA, with 155,396 PPP loans totaling $20.5 billion for Pennsylvania businesses.

Luke Bernstein, chief retail officer for Shippensburg-based Orrstown Bank, said larger business borrowers with a finance executive or in-house finance department had access to resources that made for a speedier loan approval in the opening days of the program. Independent contractors and self-employed borrowers had to wait for April 10 to begin applying for their smaller-sized loans.

“The first wave were a lot of businesses that had accountants, attorneys, maybe in-house finance departments, helping them in advance, who knew this was coming, had an application ready, wanted to get it in and they were off and running,” Bernstein said.

In the first 28 hours of the second round, which commenced on April 27, lenders approved $50 billion because they had built up 10-days’ worth of applications from borrowers who had been waiting during the 10-day interim between rounds, according to Bernstein.

Since then, the SBA’s reports indicate the funds have been approved at a much slower rate.

“That first day of round two we worked all night to get our people approved,” said Mike Keim, president and CEO of Univest Bank, a Souderton-based firm with a commercial lending division in Lancaster. “As it turns out, we had a lot more time than we thought we did.”

One major factor in the slow pace of round two loan approvals is the disincentives the SBA established in the interim between rounds to discourage larger, publicly traded companies from reserving PPP loan money, and encourage smaller businesses to take advantage of the funding.

Publicly traded companies were pressured to give back their PPP loan amount and use other sources of income to raise capital. Federal officials also announced ahead of round two that loans of $2 million or more would be subject to an audit by SBA and Treasury Department officials, according to Secretary Steven Mnuchin.

During round one, loans of more than $2 million accounted for 27% of all approved loans. But by May 23, they only accounted for about 20% in round two.

Univest Bank saw millions of dollars come back from PPP borrowers who decided the newest guidelines from the SBA for loans larger than $2 million weren’t worth the risk.

“All those myriad of factors went into effectively pushing down the loan size on the second round, as well as some people dropped out and some people repaid under the safe harbor rules what they had previously taken out in round one, and when they repaid that money, it went back into the available pool,” he said.

Orrstown Bank EVP Bernstein joins Trump for address on small business recovery efforts

Luke Bernstein of Orrstown Bank addresses the nation on efforts to support businesses during the COVID-19 pandemic. – PHOTO/SCREENSHOT FROM WHITE HOUSE LIVE STREAM

Orrstown Bank brass met with President Trump and several industry leaders at the White House Tuesday afternoon for a presidential address regarding the turbulent economic conditions that are leading small businesses to turn to the Paycheck Protection Program (PPP) and other federal loan programs.

“Every job is life-sustaining for someone, and the PPP is saving the livelihoods of those in our community,” Orrstown Executive Vice President and Chief Retail Officer Luke Bernstein said in his remarks to the nation Tuesday.

Since the first round of the PPP launched on April 3, financial services institutions approved 14 years’ worth of loans in 14 days, according to officials with the Small Business Administration (SBA), the federal agency responsible for overseeing the program. After the PPP fund ran dry two weeks after going live, President Trump approved $310 billion for the program, allowing banks like Orrstown to continue approving PPP loans.

At Tuesday’s address to the nation, Bernstein was the only representative from the financial services sector to speak on how the federal stimulus has impacted small businesses. In his address, Bernstein said Orrstown approved approximately 1,500 PPP loans in 14 days, totaling $370 million.

“In those two weeks, Orrstown processed more loans in total amount than we did in an average year last year,” Bernstein said. The loans reflect the 101-year-old community bank’s commitment to main street businesses, he said.

“We’re helping pizza shops, delis, healthcare workers, repair shops and countless others get access to these funds,” he said. “We want to thank you, Mr. President, for your leadership during this extraordinary and unprecedented time…You have unleased the innovation of private industry and we are going to respond.”

Treasury Secretary Steven Mnuchin said the new round would include provisions to prevent big businesses from rigging the PPP in their financial favor.

“Any loan over $2 million will have a full review for forgiveness before they’re repaid,” Mnuchin said.

For any business waiting on an Economic Injury Disaster Loan (EIDL) from the SBA, Mnuchin directed small business owners to the IRS website, where they can check on the EIDL loan status.

“The combination of the direct payments, the PPP, the disaster loans and the enhanced unemployment insurance is the investment that the president has made in American business and American workers,” Mnuchin said.

Also in attendance at the White House’s address Tuesday were:

  • Amy Wright, CEO and founder of Bitty & Beau’s Coffee in Wilmington, North Carolina
  • Michael Heup, an employee at Bitty & Beau’s Coffee
  • Tony Stafford, chef and founder of Ford’s Fish Shack in Ashburn, Virginia
  • Mark Underwood, an employee at Ford’s Fish Shack
  • Chris Stansbury, co-founder and partner of West Virginia Eye Consultants in Charleston, West Virginia
  • Jackie Krick, president and founder of ECU Communications in Manassas, Virginia
  • Brandon Hutson, founder of Ed and Jim’s Body Shop in Parkville, Maryland
  • Tisa Clark, president and CEO of J.D. Clark Professional Services in Upper Marlboro, Maryland
  • Ali Mills, executive vice president at Plum Contracting in Greensburg, Pennsylvania

Editor’s note: This post has been updated to reflect the correct amount of funding approved under the second round of the Paycheck Protection Program, $310 billion, not $350 billion as originally stated.

Banking relationships shifting in flurry of federal loan programs

The unprecedented volume of crisis loan applications is shifting lender-borrower relationships, as community banks establish lending relationships with small business owners who struggled to receive financial support at bigger banks.

Krista Murr, vice president retail sales manager at Orrstown Bank, works remotely on Paycheck Protection Program applications. PHOTO/PROVIDED

The largest banks in the U.S., those with a nationwide footprint, had to reserve their services for businesses with an existing lending relationship or business account due to the unprecedented number of Paycheck Protection Program loan applications received. By contrast, local community banks expanded their services to take on borrowers in their microeconomy who never banked with them before.

Wells Fargo emailed customers telling them they may want to apply elsewhere for the PPP “to increase [their] chances of receiving a loan before the funds run out.”

That left options limited for Lehigh Valley-based business owner and Wells Fargo banker Darla Malik, since other leading banks, such as Bank of American and J.P. Morgan Chase only accepted applications from businesses with existing lending relationships.

Malik, owner of Advanced Chauffeur Services in Macungie, said she was able to apply for a loan through American Bank, an Allentown-based community bank.

“American Bank did not ask me to become a banking member, except for opening up a checking account would be required to get the funding,” Malik said. But I didn’t need to already be a customer in order for him to assist me. Not only have they been assisting me but he’s been very caring about it.”

Community banks have a direct incentive and obligation to support their local economic footprints, said Centric Bank President and CEO Patti Husic.

“The success and health of our small business community is a top priority,” she said. “We pride ourselves on financing new frontiers and supporting and strengthening Main Street and the job creators.”

Orrstown Bank officials said in mid-April the bank expects to close 1,500 PPP loans, making for a total of $370 million, earning the bank $9 million of processing fees.

“We are focusing, number one, in our geographic footprint, and we are servicing clients that are referred to us by the community,” said Luke Bernstein, executive vice president and chief retail officer of Orrstown Bank. “If someone in the community reaches out to us and needs help and they’re not a client, we’ve been helping them.”

Todd Stumpf, owner of two Rita’s Italian Ice locations and two car wash services in Lancaster County, said he only had a small percent of his financial assets with Orrstown Bank. Now, he plans to expand his relationship with Orrstown. He was impressed by the Shippensburg-based lender’s proactive client services.

“We’ve got relationships with a bunch of the different banks in central Pennsylvania, and Orrstown is the only one that reached out to me,” Stumpf said. “Even the one bank I did reach out to didn’t even get back to me. They [Orrstown Bank] are not a huge bank but helping out a small guy like me and taking the time and reaching out to do it was just really helpful in getting these PPP loan forms submitted.”

Mike DiSante, owner of the Philly Pretzel Factory in Camp Hill, chose to work with Orrstown Bank on his PPP loan to pay employees and rent costs during the ongoing pandemic. Orrstown Bank helped him through a convoluted loan application process, he said, noting that he had to start the process over again and fill out forms multiple times as the SBA sent out daily guidance updates during a hectic first week.

“I might have had to sign the same form five different times as it changed, but at least I knew my stuff was ready to go and I wasn’t waiting to get my information after the fact,” he said.

DiSante’s only prior interaction with Orrstown occurred about three months earlier when he applied for a loan for a real estate project. The bank declined because lenders believed it wasn’t a good use of DiSante’s resources.

“That was the first bank in 10 years that ever really sat down and said, ‘We don’t like this because we’re looking out for your best interest,’ versus just not giving me the loan for whatever reason,” he said. “That kind of stuck in the back of my head, and when these programs started coming out, I put out my feelers out for all my contacts and Orrstown Bank was the most proactive.”

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