Limbaugh host wrongly accuses Virginia spa of using stimulus money

When Henrico County businessman Mike Vines applied for a loan to open a second spa, he never imagined his transaction would become fodder for a national radio show.

But that's exactly what happened yesterday when a guest host on conservative commentator Rush Limbaugh's radio show accused the co-owner of Escape Massage of tak ing federal stimulus money.

Vines, who describes himself as politically conservative, said he was shocked when angry callers began barraging his two places of business yesterday afternoon.

"I didn't know what had happened, but all of a sudden we were inundated with calls," he said.

Reading from a list of stimulus-money recipients that is circulating online, Mark Steyn, who was filling in for Limbaugh yesterday, said the "Escape Massage parlor in Midlothian, Virginia" had received $168,300 in government aid.

But Vines said the money actually came from a loan he and partner George Nuckolls obtained through M&T Bank to open a therapeutic spa in the Westchester Commons shopping center in Chesterfield County. The partners also own a spa in western Henrico near Short Pump Town Center.

"The Rush Limbaugh Show" did not respond to e-mailed questions yesterday.

Ronald E. Bew, district director for the Small Business Administration's Richmond office, said Escape Massage took no stimulus money but that the SBA guaranteed a portion of the loan if Vines defaults.

The stimulus package approved in February gave the SBA $730 million. A portion of that money, $375 million, went toward guaranteeing loans made by banks to small businesses, Bew said.

As part of the package, the SBA guarantees 90 percent of qualified loans made by banks. Before the stimulus, the SBA guaranteed 75 percent of qualified loans, he said.

It also eliminated fees.

"The change was made to try to encourage banks to lend money to small businesses," Bew said. "Before that, there was criticism that small businesses weren't getting access to capital."

Vines said most of the loan already has been repaid.

Escape Massage's loan is on a list of 10 stimulus-funded projects that has floated around the Internet for the past several days.

Because the SBA had to list the guarantee with the federal government, Escape Massage's loan showed up on the government's oversight Web site, Recovery.gov.

A spokeswoman for the SBA confirmed yesterday that an award number on the site matched the loan number issued by the agency.

Vines, who said he has attended Tea Party rallies protesting the government's stimulus program, first heard about federal money going to a massage parlor yesterday on Fox News' morning television news program.

He didn't connect the dots, because Fox said the money went to a massage parlor in Northern Virginia.

But the mention on "The Rush Limbaugh Show" is what got people's attention, he said.

Both owners spent the day talking with dozens of angry radio listeners who called, e-mailed and walked in. The volume was so high that they were unable to say last night exactly how many people had reached out.

"People were angry," Vines said. "And rightly so, if we had taken the stimulus money. But we didn't."