Florida’s exclusive Fisher Island Club has chosen not to accept the Small Business Administration’s Paycheck Protection Program loan despite receiving the plurality of equity member votes to keep the money, according to a recent report.
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The club, which is located on ritzy Fisher Island and reportedly charges $250,000 per equity membership, asked its members to complete a straw vote to provide their input as to whether or not the business should accept the PPP money if approved. Although 67 percent of people voted in favor of taking the money, the club has decided not to do so, the Miami Herald reported.
In a statement provided to FOX Business on Friday, the Fisher Island Club Board said it "has decided not to accept the PPP loan proceeds."
A spokesperson did not immediately respond to inquiries seeking additional details, specifically regarding the future of the club’s employees. It was not immediately clear whether equity members would now be required to pay the $5,000 assessment fees.
Earlier this week, club officials emailed members to say they had applied for the loan, but wanted their help as to what they should do if approved. The email also warned that if members voted against taking the money, each person would likely need to pay roughly $5,000 to keep its employees on the payroll – and risk potential layoffs.
Monday’s email described how the club, which boasts a staff of 400, “is projected to lose many, many millions in revenue in 2020” as a result of local government mandates calling for most of its amenities to remain closed during the novel coronavirus outbreak.
In a second email, which was sent to members Thursday and obtained by the Herald, Fisher Island Club’s board of directors said they will not accept the loan, attributing the decision to new details from the government about what businesses needed to qualify for the loan, according to the report.
“[B]orrowers still must certify in good faith that their PPP loan request is necessary,” states guidance issued on April 29 by the Treasury Department. “Borrowers must make this certification in good faith, taking into account their current business activity and their ability to access other sources of liquidity sufficient to support their ongoing operations in a manner that is not significantly detrimental to the business.”
The board stated in the email that while it would be “quite appropriate” for the club to accept the funds in accordance with its plan to continue playing staff members, “we have carefully reviewed these new guidelines with our legal counsel and accountants and decided that the Club should not accept the PPP funds.”
“We believe this decision is in the best interest of the Club and its Members,” the board said in the email Thursday. “We will be reviewing options for addressing the operating deficit over the next few weeks.”
News of the Fisher Island Club's decision to apply for the loan came just days after it was revealed that residents voted to reject a $2 million loan allocated to one of the island's homeowner's associations, Fisher Island Community Association.
FICA was approved for the loan, but opted not to keep the money after residents voted against it.
Fisher Island, which has the wealthiest zip code in the country, recently made headlines for providing each resident with antibody testing "to further minimize spread on the densely populated island with half of the residents over the age of 60 and at high risk," a spokesperson told FOX Business at the time.
The Associated Press contributed to this report.