September 3 — Local Restaurants Urge $60 Billion Refill of SBA Grant Program as Industry Loses Jobs for the First Time in Eight Months

FOR IMMEDIATE RELEASE

September 3, 2021

CONTACT:

Jeff Solnet

jeff@precisionstrategies.com 

WASHINGTON D.C. – Today, the Independent Restaurant Coalition released the following statement in response to the Bureau of Labor Statistics August jobs report showing that restaurant and bar employment fell 41,500 during the past month, the first downturn for the industry in eight months. Restaurant and bar employment is still down 966,300 below its pre-pandemic levels.

“If our representatives don’t prioritize replenishing the Restaurant Revitalization Fund immediately, restaurant and bar workers will pay the price,” said Erika Polmar, Executive Director of the Independent Restaurant Coalition. “Businesses are at the end of their rope. The virus is surging, summer weather is ending, and months of debt are piling up. The costs of goods are increasing, consumers aren’t as willing to eat out, and options are growing limited for the over 170,000 restaurants and bars who applied for an SBA grant and are still waiting. These small businesses need financial flexibility to recover from the past 18 months of debt they have accumulated, pay employees competitive wages, and keep their communities safe. If Congress leaves restaurants and bars behind, thousands of small businesses will close, causing economic devastation that we are only beginning to understand.”

The Delta variant threatens to push more restaurants and bars into permanent closure. Since the beginning of the pandemic, more than 90,000 restaurants and bars have closed. There are now dining restrictions in roughly a third of the states in the country. Restaurant reservations have plummeted in states across the nation; for instance in New York (49%), Pennsylvania (49%), Maryland (47%), Alabama (12%), and North Carolina (18%) bookings are far below their 2019 levels. According to a recent survey, 60% of adults changed their dining habits due to the Delta variant. 

This comes at a crucial time for neighborhood restaurants and bars. The Small Business Administration (SBA) closed the Restaurant Revitalization Fund (RRF) application portal, leaving 177,000 restaurants and bars that applied for relief out in the cold. Restaurants and bars lost over $280 billion during the pandemic yet only received $28.6 billion in targeted relief. These businesses continue to deal with pandemic-induced headwinds — over the past year, the prices of beef and veal (40.3%), grains (87.0%), and shortening and cooking oil (39.5%) have surged. This relief will give many of the nation’s 500,000 independent restaurants and bars the support they need to survive the pandemic as well as the 16 million people they support to survive the pandemic.

Support for providing restaurants and bars the relief they need is continuing to grow. Senator Ben Cardin (D-MD) recently moved by unanimous consent to add $48 billion to the RRF, invoking fierce speeches on the Senate floor from Majority Leader Chuck Schumer (D-NY) and Senator Dick Durbin (D-IL). The Restaurant Revitalization Fund Replenishment Act is gaining rapid bipartisan support as 214 members of the House of Representatives have come out in support of the bill, including most recently Rep. Alexandria Ocasio-Cortez (D-NY-14), as well as 15 members of the Senate. Reps. Earl Blumenauer (D-OR-3) and Brian Fitzpatrick (R-PA-1) and Sens. Roger Wicker (R-MS) and Kyrsten Sinema (D-AZ) introduced the legislation in both chambers of Congress, which provides $60 billion in additional funding for the RRF. 

The RRF is a grant relief program modeled after the $120 billion RESTAURANTS Act, which independent restaurant and bar operators from the IRC specifically designed alongside Senator Wicker and Congressman Blumenauer so their industry could access the relief they need. Thousands of IRC supporters first proposed this program in an April 2020 letter to Congress.  

This first-of-its-kind grant program provides debt-free support in the amount of annual revenue lost from 2019 and 2020, with special provisions for businesses that opened in 2020 and 2019. They can only be used on eligible expenses (below) incurred starting on February 15, 2020 and ending on March 11, 2023. Unused funds – or funds not used for these purposes – will be returned to the government. These expenses include:

• Payroll (excluding employee compensation exceeding $100,000/year), employee benefits, and paid sick leave;

• Mortgage, rent, and utilities;

• Maintenance;

• Outdoor seating construction;

• Supplies, protective equipment, and cleaning materials;

• Food and beverage;

• Operational expenses; 

• And principal business payments for business debt. 

This program caters to the most vulnerable businesses: grants cannot exceed $10,000,000 per restaurant group (which cannot have more than 20 entities), and $5,000,000 per business. The landmark legislation prioritizes awarding grants to women or Veteran-owned businesses, and socially and economically disadvantaged groups, including Black Americans, Hispanic Americans, Native Americans, Asian Pacific Americans and Subcontinent Asian Americans. And for the first time, the SBA provided an application in Spanish.

ABOUT THE IRC:

The Independent Restaurant Coalition was formed by chefs and independent restaurant owners across the country who have built a grassroots movement to secure vital protections for the nation’s 500,000 independent restaurants and the more than 11 million restaurant and bar workers impacted by the coronavirus pandemic.