Spaulding Smails

I am relatively certain that only W2 wages qualify for loan forgiveness. Rent, utilities and W2 wages. No 1099 / subcontractor costs.

That's no joke. Of the 15 hours, she drove for one. And hit a damn turkey. Needless to say, she hasn't driven it since.

Nice. Thanks for the update. I ordered a Fox steering stabilizer yesterday. Going on next week. Thanks for the recommendation. I need to haul my Bobcat out to the ranch in a few weeks, so I want it on by then. I also had to order a new grille. We drove to Telluride in my truck for spring break. Got to the mountain the day they closed it. Stayed a day so the kids could play in the sun, then turned around and did a cannonball run back home the next day. That was the first Monday as shit was going crazy because of the rona. I had to get a letter out to my employees, so my wife drove for about an hour or so near Hobbs, NM. And she managed to hit a turkey. In broad daylight. On a flat road. My grille was jacked (though not as bad as the turkey). At least it didn't hit the LED lights. Putting on the new grille and adding some LED lights in the grille as well. I'm going to wait a few months before I explore a little lift and new shoes. May do a brush guard as well for future turkey encounters.

Let me know how the ride improves. I have a 2019 F350 as well. About 50K miles. I've had the death wobble happen to me twice in the last month. I need to do something. I have an extra truck at the shop, so I may drop mine off for a bit and go ahead do some other stuff as well. Brush guard, LED lights in the grill, little lift, new rims and 35s.

Do you have verification from the SBA on that? I know the $100K cap was in place for the front-end calculation, but my CPA said it's not a limiting factor for how the PPP gets spent / forgiven. I have four employees making over $100K, and we're assuming (again based on my CPA's feedback) that it's 100% forgivable. I also paid Q1 bonuses using those funds under the premise that it will be forgivable. With some of my guys, that doesn't put them over $100K, but for three that are in the $80K-$90K range, that amount when tacked on to their normal wages in the 8 week timeframe would push them well over the $1,923/wk mark.

I had a call with my CPA about 10 days ago. He indicated that, at that time, the SBA had not yet released specific guidelines and definitions for these expense categories. I asked him about a few items like fuel, and his advice was to not push it. Roll with what you're sure qualifies, and avoid raising any eyebrows or encouraging an audit. My immediate question was around cell phone service. I can see that as closer to the definition of "utilities" than fuel for vehicles and equipment. If anyone has more insight here, I'm all ears.

Well I'll be damned. I've been in construction for 20+ years and I've never realized that I've been spelling that wrong. Damn, do I feel like a dumb ass.

Years ago, I built two blinds using masonry scaffolding as the base. I got some used scaffolding pretty cheap from a sub that was downsizing. 5' x 7' was the dimensions of the blind. Easily fit two adults. Built the walls at home, stacked them flat on a trailer with the scaffolding, then erected it and tied it all together with one other guy at my lease. Did the roof framing, decking and down corrugated tin on site. Pretty easy and pretty cheap and lasted for several years.

I've heard hedge trimmers work well. In all seriousness, if your new appliance has a trim that's going to hide imperfections, just use a jigsaw or fine tool. If it's going to be visible, try to use a track saw of clamp a guide to the edge that you can use to run a straight line with a router. If it can be removed and you can work it on a bench then reinstall it, that would be ideal.

Yup. Or one big customer going tits up.

Our AR is up 27% MOM. On one hand, that's good because we're continuing to invoice. On the other hand, it's bad because we went from 21% past due to 36% past due. Money has definitely slowed. I've had two commercial clients (one hospitality, one personal services) ask for extended terms or at least deferred payments. We extended terms by 30 days for each but told them an intent to lien would be filed if we didn't receive payment. Earlier this month, we waived the processing fee for all clients. This has helped keep cash flow in check, but has degraded margins. I'm guessing our AR would be up closer to 40% if we hadn't taken those measures. That's not an option for all businesses, but may be a viable alternative if anyone needs an boost to cash flow.

Can you send pics of the interior and exterior of the existing door? You may want to consider that you'll probably have to re-mortise for hinges on the existing jamb, so replacing trim and lowering the header with a strip of 1X material would be pretty simple as long as your interior and exterior conditions don't cause that to open a can of worms.

I think it depends on your business. We now maintain at least six accounts at all times. Usually more. Operations - All deposits and payables to vendors / subs flow through this account. Expense - Our employees have debit cards for small purchases where we don't have an account. We keep the account that those cards are linked to separate to make it easier to reconcile and to prevent a runaway train if fraud occurs. Payroll - Funds are transferred from operations to payroll then to our payroll processing company. Makes it super easy for payroll reporting calculations. Capital Investments - This is our slush fund. We maintain a minimum balance here, and we take a "rake" of profits every quarter. We use this for purchases of vehicles, equipment, etc. Owner Equity - Remaining excess profits flow through here on a quarterly basis. It gets disbursed to me and my partners annually and we hold back a portion for taxes. PPP - We now have a PPP account. I transferred all of our PPP proceeds to this account. I just transferred my full payroll burden to the payroll account from here yesterday. Will do the same on subsequent payroll runs, mortgage and utilities. We'll keep a separate folder for these expenses, but it will make it nice and clean so that those funds don't get lumped in with our operational cash flow. We also create separate accounts for any job over $100K where we're the primary GC. This allows us to prevent "robbing Peter to pay Paul" on jobs. We keep job profits in there for one year to cover any warranty expenditures, then one year after completion, we close the account and transfer any remaining profits to the owner equity account. Multiple accounts can be a pain from a banking and reconciliation standpoint, but it absolutely helps us keep everything in the correct bucket and gives me a good snapshot of cash flow on a real time basis.

This is damn fine work. And, it looks like you didn't even fuck up your wood floors! You saved a shit ton of money and the work is excellent from what I can see.

Our funds hit this afternoon.

That's a great observation. Certain industries that have longer lead times, longer receivable terms and bigger backlogs are set up to weather the initial storm, but will feel the impacts of this shutdown months or even years down the line. The industries that were hardest hit were those with point-of-sale transactions that shut off immediately. The only plus-side to those business models is cash flow is almost immediate, so when the reigns start to loosen, they should see an immediate boost to revenue and hopefully profits.

I bank with Broadway. As mentioned previously in this post, we switched about five years ago from BBVA. I have all of my business banking for three businesses through them. We finance all of our vehicle purchases through them and I have a revolving LOC. Plus, my personal banking and mortgage is through them. From a business perspective, the only thing we don't have with them is our mortgage on our building which is through a close friend's smaller bank. It's been phenomenal to have a dedicated banker. Not sure how much of that is just the fact that we do a decent volume of business with them and how much of that is their general level of service, but my perception is that Broadway is small enough to avoid the big bank bureaucracy, but large enough to have their shit together and offer good products, support, online banking, etc. I can't say enough good things about Broadway as a whole leading up to this, and their service through this SBA PPP has been a reaffirmation of how well run they are.

Got a note from our banker this afternoon that we're approved. They're waiting on direction from SBA and the Treasury regarding funding. Sounds like the same update most of y'all are getting at this point.

I've had two calls from my banker today with minor questions about the application. Nice to see bankers working more than 30 hrs/week for once!

Two takeaways from this: -So glad we're with a mid-sized bank now (Broadway) instead of a behemoth (BBVA) like we were a few years ago. BBVA was a revolving door of inexperienced "bankers" who didn't know their head from their ass. Constantly re-telling our story, no proactivity. Broadway has been a dream to work with. They're proactive, they know me, and I truly feel like they have our best interest in mind. They're all about the long-term relationship. They've been rock stars over the last week through this SBA process. -So glad we outsource payroll. I've been able to keep my office focused on operations. I sent one note to our PEO rep Wednesday. They're already handling hundreds of other businesses like mine that need the payroll info. No problem. We'll have the info to you by EOD Thursday. Bam. Perfectly formatted. All the information I needed. Would have been a pain to compile that internally.

I've always had trouble sitting still, and we've had a full plate with kids' activities, etc for the last several years, so coming to a complete stop has been difficult. Work has been bananas trying to figure this all out, so I'm spent at the end of the day. We've been eating good, but I've been drinking too much. To keep busy, I've knocked out a ton of projects around the house. Still a bunch more on the horizon. My son has been obsessed with "Forged In Fire", so we started making a machete. That's been great spending time with him and letting him take the reigns there. Every night, we go outside and shoot hoops or hang while the kids ride bikes. Been playing a ton of darts and 9-ball with my wife. And lots of card games. The only thing that I really watched on TV is sports, so I really miss that. My running has been back up. Averaging 30 miles/week over the last two weeks which is double what I was doing. We're at the ranch right now. It's been incredibly cathartic. I've been working as much as I would be at home, but it's nice to be able to go for a long walk around the place looking for sheds when I need a break.

This is very similar to our forecast and the pending implications. As I said previously, we're in a good industry (construction / facility maintenance) with a good balance sheet and a strong backlog. We had our largest month ever in February, and we were well on our way to $10M in revenue this year (30% YOY increase). Even with Abbott re-opening construction yesterday, we're going to see a drop in production and revenue over the next few months. Not to mention, I'm now forecasting a much lower than originally planned Q3 and Q4. So, even if we're not feeling the pain to the magnitude and immediateness of other industries, this is going to leave a mark. We don't "need" the SBA loan to survive, but we're damn sure going to try to take advantage of it. If nothing else, it extends our runway several months to adjust our business model and keep a big chunk of our employees on the payroll that we would have otherwise had to consider laying off.

https://www.fox26houston.com/news/governor-abbott-issues-essentials-services-order-for-texas

That part was confusing to me as well. You have to think it's going to be what's showing up on your payroll reports. Wages, benefits, retirement, PTO. Things that can be validated and confirmed. If it is open to 1099s, it leaves it way to wide open for manipulating the subs and potential fraud. I think there's going to be plenty of attempts at fraud as is, but isolating it to W2 reports at least makes it more standardized.

It's my interpretation that, as an employer, the calculation for payroll is based on W2 wages only. I'm going to clarify that on my call with my banker tomorrow.