B17-05 Federal Financial Support to Tobacco Retailers During the Covid-19 Pandemic

Abstract Background Tobacco use disorder is a leading cause of preventable death. Most people who use tobacco started as teens. Underaged tobacco sales are high in tobacco specialty retailers including Tobacco/Vape shops. These stores expanded by 280% between 2017 and 2023 in the state of Iowa despite the economic disruptions of the COVID-19 pandemic. We hypothesized that nationwide, tobacco retailers were major recipients of federal financial assistance from Paycheck Protection Program (PPP) loans and that these loans passed through large national banks. Objectives 1. To measure the federal assistance provided to tobacco specialty businesses, including tobacco producers, manufacturers, and retailers. 2. To identify banks that supported the tobacco industry with loans. Methods We obtained the PPP loan database from the U. S. Small Business Administration (SBA) on July 1, 2025. We used RStudio for data processing and statistics. Tobacco retailers were identified either by the industry named in the PPP database or by keywords in the business name. We selected a 1: 1 matched control loan set from the PPP database using state, loan amount, business type, and business owner demographics as matching variables. For each PPP lender, we compared the number of loans made to tobacco vs. control businesses and determined statistical significance using the binomial distribution. Results Tobacco businesses received 17, 340 PPP loans (594. 8 M forgiven) from the SBA. Most recipients were tobacco retailers (N = 10, 567 loans, 300. 03 M forgiven). Other businesses receiving PPP loans included tobacco wholesalers, manufacturers, farmers, lounges, and distributors. Banks that processed the most PPP loans to tobacco businesses included JPMorgan Chase (873 loans, 36. 0 M), Bank of America (1053 loans, 34. 6 M), and Intuit (841 loans, 24. 3 M). Using the binomial distribution, we identified banks that disproportionately serviced PPP loans to tobacco interests. Examples included Intuit (841 tobacco vs. 46 control, P = 5 x 10-190) and Oxford Bank (131 tobacco vs. 2 control, P = 1. 6 x 10-36). 78. 6% of loans to tobacco retailers were serviced through banks operating in at least 25 states. Discussion Collectively, tobacco retailers received 300 M in loan forgiveness from the federal PPP program. Tobacco retailers were mainly served by nationwide banks. Some of these banks disproportionately served tobacco interests as opposed to matched control businesses. Compared to local lenders, national and online banks may experience fewer negative externalities caused by tobacco retail. Greater government oversight is needed to decrease unintended public financial support for the tobacco industry. This abstract is funded by: None