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Lakers return $4.6 million coronavirus relief loan

The Los Angeles Lakers has repaid a $4.6 million coronavirus relief loan the professional basketball organization received as part of the fe...

Posted: Apr 28, 2020 3:42 AM

The Los Angeles Lakers has repaid a $4.6 million coronavirus relief loan the professional basketball organization received as part of the federal government's Paycheck Protection Program.

"The Lakers qualified for and received a loan under the Payroll Protection Program," a Lakers spokesperson wrote in a statement emailed to CNN Business. "However, 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 Lakers -- the second-most valuable NBA team with a $4.4 billion valuation, according to Forbes -- is the latest big-name entity to obtain and subsequently return money touted as a Covid-19 relief measure for small businesses. The news was first reported by ESPN.

The highly trumpeted PPP effort has come under scrutiny following reports that large businesses, including publicly traded companies, received high-value loans. The $349 billion in funding, which was quickly depleted, was intended to help small businesses. Following public scrutiny, businesses such as Shake Shack, Ruth's Hospitality and Kura Sushi said they would return their multimillion-dollar loans.

Late last week, Treasury issued guidance intended to prevent large entities -- especially those with other means of securing funding -- from receiving the loans. Companies that cannot, "in good faith," prove that the loan is necessary for their business after fully taking into account their liquidity and operations were asked to repay the loans by May 7, 2020.

The Lakers organization qualified for the $4.6 million PPP loan because it has 303 full- and part-time employees, a source with knowledge of the situation told CNN. The source also said the company has not and is not planning to furlough or lay off any employees and that the Lakers' top executives agreed to defer 20% of their salaries to ensure other employees could be paid.

The Lakers have contributed to a fund along with the Los Angeles Clippers and Los Angeles Kings to provide financial support to employees of Staples Center.

Any loans returned or repaid will go back into the program for future disbursement, an SBA spokesperson told CNN Business last week.

The SBA has not disclosed who was approved for PPP loans and the amount received. CNN and other entities have filed Freedom of Information Act requests for this information. More than 200 publicly traded companies received at least $870 million in PPP loans, according to a FactSquared analysis of US Securities and Exchange Commission filings.

As of April 16, the SBA had approved more than 1.66 million loans for more than $342.2 billion, according to an agency report. Of those, 4,412 were for $5 million and above. The high-value loans represented 0.3% of the total number of loans and 9% of the overall dollar value.

"When a wildly successful sports franchise that can afford to pay LeBron James nearly $40 million a year is being shamed into returning paycheck protection program funds, the question we should be asking is why the White House and Congress haven't been more prescriptive about who and what can qualify for help," Kyle Herrig, president of government watchdog group Accountable.US wrote via email to CNN Business. "This program is in desperate need of increased transparency so that struggling mom and pop small businesses on the cusp of bankruptcy can get the assistance they need."

- CNN's Kevin Dotson contributed to this report.

Oregon Coronavirus Cases

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Confirmed Cases: 33291

Reported Deaths: 555
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Jackson11715
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California Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 815654

Reported Deaths: 15782
CountyConfirmedDeaths
Los Angeles2692846551
Riverside591731216
San Bernardino54849952
Orange535571249
San Diego46985781
Kern32019369
Fresno28517390
Sacramento22438412
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Contra Costa16702206
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Tulare16071263
Ventura12812150
Imperial11877317
San Francisco11238101
Monterey1000872
San Mateo9950150
Santa Barbara9133113
Merced8939143
Kings766180
Sonoma7412122
Marin6727118
Solano641969
Madera455765
San Luis Obispo359729
Placer359645
Butte283744
Yolo282555
Santa Cruz23799
Sutter171711
Napa170513
San Benito134811
Yuba11588
El Dorado11444
Mendocino93918
Shasta88320
Lassen7410
Glenn5933
Tehama5795
Lake55911
Nevada5407
Colusa5326
Humboldt5098
Calaveras31714
Amador29616
Tuolumne2274
Inyo18815
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Mariposa762
Plumas500
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Trinity160
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