April 27 (UPI) — The Los Angeles Lakers returned about $4.6 million from a federal government program intended to help small businesses during the coronavirus pandemic after learning the program had been depleted.
The Lakers, one of the NBA’s most valuable and profitable franchises, applied for the loan through the Small Business Administration’s Paycheck Protection Program, a part of the federal government’s $2.2 trillion stimulus package.
The team was among the companies and non-profit organizations granted loans during the first round of distributions. But after reports that multiple wealthier businesses were securing aid, while smaller businesses were shut out due to the program running out of money, the Lakers said they have returned the loan.
“The Lakers qualified for and received a loan under the Payroll Protection Program,” the team said Monday in a statement to ESPN and the Los Angeles Times. “Once we found out the funds from the program had been depleted, we repaid the loan so that financial support would be directed to those most in need.
“The Lakers remain completely committed to supporting both our employees and our community.”
The Paycheck Protection Program, which was established as part of the $2.2 trillion CARES Act and launched on April 3, allows small businesses to apply for and receive loans to cover employee salaries and various expenses. The Lakers, with about 300 employees, were eligible for a loan from the program.
The program ran out of money after less than two weeks, leaving many small businesses without financial assistance.
Forbes estimated the Lakers were worth about $4.4 billion before the COVID-19 outbreak, with Los Angeles trailing only the New York Knicks ($4.6 billion) as the league’s most valuable franchise.
The NBA suspended its season on March 11 after Utah Jazz center Rudy Gobert tested positive for COVID-19. The Lakers previously pledged not to furlough or fire any team employees during the pandemic.
Earlier this month, the Lakers’ top executives agreed to defer 20 percent of their salaries until later this year or next season.