Politics

by David Klemt David Klemt No Comments

What Politicians Get Wrong about Us

What Politicians Get Wrong about Our Industry

by David Klemt

Restaurant and bar with exterior windows open

It still stings that the 43 senators chose to vote against replenishing the Restaurant Revitalization Fund.

The fact that four senators didn’t vote at all on S.4008 is nearly as insulting and painful.

Now, while all the “nay” votes came from Republican senators, I’m not here to bash one party in particular. Four Republicans voted “yea,” as did two Independents.

Unfortunately, given how hostile Democrats and Republicans in Congress seem to be, it’s difficult to be objective. Right now, it appears that the RRF was left to die a slow death because many—not all, of course—Republicans in power don’t want their Democrat peers to “win” at anything.

To be used as political pawns and be left out in the cold… It’s a bitter pill to swallow.

Cornerstones

Too many politicians, it seems, view restaurants and bars as they would other types of businesses. Perhaps the perceived success of national and global brands paint the picture that independent venues and small chains don’t need any help.

More disappointingly, maybe politicians, from local lawmakers to state representatives, take our business’ role for granted.

Look at the history of restaurants and bars, of hospitality. Think about the rich history of hospitality in America alone, let alone globally.

Yes, independent restaurants and bars are small businesses. But like so many small businesses in so many towns across the country, they’re so much more.

Restaurants and bars are pillars, cornerstones of the communities they serve. These are businesses that welcome people in, treat them like family. They’re there for them as they move through their lives.

People who were seemingly at odds with another routinely found common ground over a bite and a sip. More often than not, that’s still the case.

Operators and their teams give back to their communities through food drives, quietly feeding those in need, and finding other ways to give back.

And they look out for their communities.

Lifesavers

Last week, the team at a cafe in the Bronx called the Chipper Truck helped rescue a woman from an alleged hostage situation.

Permitted by her assailant to place a food order via Grubub, the victim thought quickly and sent a life-saving note with her order:

“Please call the police… don’t make it obvious.”

A staff member read the note in the “additional instructions” section of the order and called one of the owners. Nobody at the Chipper Truck knew if the situation was real but they chose to err on the side of caution.

When the alleged assailant—who was arrested and charged with a list of serious offenses—opened the door for the Grubhub order, he was met with police officers.

A Facebook post from the cafe addressing the situation read, in part, “I’ve often heard of this happening but never thought it would happen to us. Thankfully we were open and able to help her.”

It’s terrifying that this happens enough that the cafe owners hear about it “often.” But it’s telling of the role restaurants and bars play in their communities that they’ve saved multiple lives.

This is to say nothing of the restaurants and bars that have put coded safety systems in place to help patrons who find themselves in danger.

No Such Thing as “Just” a Restaurant or Bar

There isn’t a restaurant or bar out there that’s “only” a restaurant or “only” a bar.

Every one is a source for food, for socializing, for an escape from the stresses of life. Restaurants and bars are committed to service and sacrifice.

They’re pillars of their communities, the cornerstones that play important roles in our everyday lives and the special moments as well.

Perhaps our politicians, local and otherwise, need to a reminder. Restaurants and bars play crucial roles in the lives of the people politicians are supposed to represent.

Too many politicians claim to support small businesses while their actions and votes prove otherwise. Talk, as we all know, is cheap.

Restaurants are not “just” restaurants. Bars are not “just” bars. We deserve better.

Image: Scott Webb on Unsplash

by David Klemt David Klemt No Comments

House Votes to Replenish RRF

House Votes to Replenish RRF

by David Klemt

United States Capitol Building dome in greyscale

Eleven months after the closure of the Restaurant Revitalization Fund application portal, Congress has voted on RRF replenishment.

Earlier today, the House voted “yes” on $42 billion for the RRF via the Relief for Restaurants and Other Hard Hit Small Businesses Act of 2022 (HR 3807).

To clarify, the intent is that funds go to original applicants who were left out when the portal closed.

Neither the $1.7 trillion Build Back Better Act nor the $1.5 trillion omnibus spending bill passed in March included the RRF Replenishment Act.

So, this news is obviously fantastic. However, it’s also long overdue.

We’ve waited nearly 11 months for movement on relief for our ravaged industry. In comparison to the hospitality industry, the legislative process often moves at a glacial pace.

For obvious reasons, the long delay in replenishing the RRF has been devastating.

Nearly a month ago, I wrote and published “Congress is Abandoning Us.” Some considered the article harsh, others agreed with what I wrote.

To be clear, I stand by what I said after ten months of inaction. However, I’m relieved—cautiously—that the House proved their support for our industry today.

$55 Billion Lifeline

In its current form, the House bill would provide $42 billion. This is the amount believed to be enough to award grants to the original applicants from May of 2021.

Additionally, there’s another $13 billion for businesses in other hard-hit industries. So, the House bill provides a total of $55 billion in relief.

Per bill co-author Rep. Earl Blumenauer (D-OR), those who applied last year for the first (and only) round of RRF relief won’t have to re-apply.

Rep. Blumenauer reportedly told Nation’s Restaurant News that “[t]he independent restaurant is the foundation of a livable community.”

Continuing, Rep. Blumenauer told NRN, “We need to have these institutions to provide a foundation for our neighborhoods.”

As far as the source of the $55 billion, the money is supposed to come from funds recovered from 2020 and 2021 pandemic relief programs. This includes billions of dollars stolen through fraudulent relief program claims.

In an effort to combat further fraud and show the public that the funds are indeed going to the correct recipients, the SBA will be required to be transparent about its process.

As it stands, grant recipients will need to spend the funds on eligible uses by March 11, 2023.

Bittersweet

While this is huge news for our industry, it’s somewhat difficult to let go of my frustration fully. The RRF portal opened May 3, 2021. It closed just 21 days later, shutting out an estimated 177,000 grant applicants.

In June of last year, Sens. Kyrsten Sinema (D-AZ) and Roger Wicker (R-MS), and Reps. Earl Blumenauer (D-PA) and Brian Fitzpatrick (R-PA) introduced a bill to replenish the RRF.

That was followed in July by the ENTREE Act, introduced by Rep. Blaine Luetkemeyer (R-MO).

Then, in August, Sen. Rand Paul (R-KY) objected to a unanimous consent motion to fund the RRF. Essentially, after that occurred, it was crickets.

As stated above, when the Build Back Better Act was passed in November, relief for our industry was nowhere to be found.

Given all of this, and the fact that the bill must now go before senators for debate and a vote, I find myself still uneasy about the fate of the RRF.

We often say hope isn’t a strategy. However, I hope our senators do the right thing and pass the relief our industry so desperately needs and deserves.

Image: Joshua Sukoff on Unsplash

by David Klemt David Klemt No Comments

Hang On: That Drink Probably Isn’t Russian

Hang On: That Drink Probably Isn’t Russian

by David Klemt

Three clear vodka or gin cocktails

In response to the invasion of Ukraine, some restaurants and bars are pouring out spirits or renaming cocktails they believe are Russian.

Doing so is one way some operators are showing support for Ukraine.

However, people may want to do some research before they pour out a bottle or rewrite their menus. The reason is simple: That bottle or drink may not be Russian.

White or Black Russian

This classic cocktail has zero Russian roots. It was created by a Belgian bartender. Further, the bartender, Gustave Tops, created the drink at a hotel in Brussels.

Unfortunately, that hotel operated for 125 years before closing in 2020.

According to cocktail historians, the drink only has “Russian” in the name because it’s made with vodka.

In fact, people have created riffs on the White/Black Russian just by replacing a single ingredient. Variants include the White Belgian, White Cuban, and White Canadian.

Moscow Mule

The Moscow Mule is 81 years old. And it was born in…Santa Monica. One of the most notable things about Santa Monica is that it’s located in California, which is in America.

As the story goes, a salesman representing Smirnoff strolled into the Cock ‘n Bull Pub. The owner of the pub had purchased a bunch of ginger beer he was having trouble moving.

In the 1940s, supposedly, it was difficult to sell vodka or ginger beer. But what about vodka and ginger beer? According to legend, the two men created the Moscow Mule in a mutually beneficial sales move. The rest is cocktail history.

Obviously, the name has Russian roots. Smirnoff vodka was at one time a Russian vodka (more on that below). But no, the cocktail isn’t a Russian cocktail in so far as it was invented in America.

There are companies that have made copyright claims but they’ve largely gone nowhere.

Smirnoff Vodka

Pouring out bottles of Smirnoff isn’t going to stick it to any Russians. The brand is now owned by Diageo, a British company.

The vodka itself is produced in several countries, including Canada, Ireland, and the US. Not a drop is made in Russia.

Originally, the vodka was produced in Moscow. Pyotr Arsenyevitch Smirnov founded the distillery in 1864. However, Smirnov had to sell the brand in 1904 after Tsar Nicholas II nationalized the Russian vodka industry.

Smirnov and his family fled Russia in 1917 in response to the October Revolution.

In reality, with the exception of very specialized bars and off-premise shops, it’s not common to come across authentic Russian vodka. Beluga, Jewel of Russia, Mamont, Russian Standard, and Zyr are some of the few people may come across at a restaurant, bar, or liquor store.

The Problem

It may seem like a middle finger to Russian president Vladimir Putin to erase the country from menus. Renaming cocktails or removing Russian brands feels like a show of solidarity, on the surface.

In reality, doing so is dangerous. It’s a vilification of all Russian people, even if it doesn’t feel like it. Pulling certain brands may put a dent in someone’s bottom line. However, “sanitizing” a menu by removing everything Russian may send an irresponsible, unintended message: Russian people are bad.

We don’t have to look far back into history at all to see what can happen when we vilify an entire group of people. Violence, harassment, discrimination… In these tense, divisive times, it’s all too easy for people to become desensitized and even engage in truly horrible behavior.

I’m appalled by what’s happening in Ukraine. Everyone at KRG Hospitality is horrified by Putin’s invasion. A single drop of blood spilled is too much; Putin’s hands are covered in innocent blood.

But I’m not going to show my support by declaring or otherwise acting like all Russians are bad people. One person—and his complicit inner circle—is responsible for the ongoing attack on Ukraine.

Let’s not forget that, and let’s not forget that words and actions have consequences. It’s all too easy for people to take things too far and for innocent people to get hurt.

Image: Vinicius “amnx” Amano on Unsplash

by David Klemt David Klemt No Comments

Months Pass, RRF Still not Replenished

Months Pass, RRF Replenishment Remains Uncertain

by David Klemt

Time has run out hourglass, black and white

If you’re wondering if the RRF Replenishment Act of 2021 or ENTREE Acts are making progress, you’re not alone.

Unfortunately, it appears far too many politicians on all sides are focusing on anything but our industry.

Indeed, it’s apparently more important that they score political “points” for sniping at each other on social media; engage in hyperbole and histrionics; and overall engage in brinksmanship instead of doing anything meaningful for their constituents.

Meanwhile, the industry has lost more than $300 billion in revenue over 19 months. Additionally, we’re short at least one million jobs.

So, it’s not hyperbolic to state this: It’s no longer time for Congress to act, time has very much run out.

It’s up for owners and operators, their teams, and their teams’ families.

Replenish RRF Act

As people familiar with the Restaurant Revitalization Fund will recall, the fund launched with $28.6 billion. Obviously, that was nowhere near enough funding to meet the demand for grants.

The National Restaurant Association estimates that 177,000 grant applicants are still waiting for assistance. Those applications total more than $43 billion.

Essentially, $60 billion would be printed to replenish the RRF. That’s according to the language in the RRF Replenishment Act bill.

In June, Sens. Kyrsten Sinema (D-AZ) and Roger Wicker (R-MS), and Reps. Earl Blumenauer (D-PA) and Brian Fitzpatrick (R-PA) introduced the bill.

It’s now the middle of October.

ENTREE Act

Toward the end of July, Rep. Blaine Luetkemeyer (R-MO) introduced an alternative bill.

A ranking member of the House Committee on Small Business, Rep. Luetkemeyer proposed the Entrepreneurs Need Timely Replenishment for Eating Establishments Act on July 20.

Again, that was in July and it’s now October 25.

Known as the ENTREE Act (acronyms are fun, eh?), this bill wouldn’t just create $60 billion out of thin air.

Instead, per the text of the bill, the ENTREE Act would use unspent funds from the American Rescue Plan and Economic Injury Disaster Loans.

Now What?

In early August, there was an attempt made to replenish the RRF with $48 billion of emergency funding.

Sen. Ben Cardin (D-MD), along with a bipartisan group of senators, sought unanimous consent to authorize the funds.

Unfortunately, Sen. Rand Paul (R-KY) objected to the unanimous consent motion. The measure was blocked due to Sen. Paul’s objection and the RRF didn’t receive any emergency funds.

So, now what? In August, political insiders expressed their opinion that the ENTREE Act wasn’t likely to be passed.

Meanwhile, the RRF Replenishment Act hasn’t made significant progress since it was first introduced in June.

Most recently, members of the Independent Restaurant Coalition held a press conference with Rep. Blumenauer and Rep. Dean Phillips (D-MN). During the press conference, it was pointed out that Congress was voting on infrastructure bills that didn’t contain the RRF Replenishment or ENTREE Acts.

The most that can be said currently about any “progress” is that House Speaker Nancy Pelosi has made a promise that relief for the industry is coming, somehow, during some unknown timeframe.

Great. In the meantime, you, your family members, your friends, and your guests can contact their reps to put more pressure on them to replenish the RRF. You can also click here for more ideas from the IRC on how to get the message across that our representatives need to act now.

Perhaps reminders that every House seat and 34 Senate seats are up for re-election next year will help spur some action.

Image: Eduin Escobar from Pixabay

by David Klemt David Klemt No Comments

State of the RRF: By the Numbers

State of the RRF: By the Numbers

by David Klemt

Wad of dollar bills with red rubber band

The “tale of the tape” of the Restaurant Revitalization Fund tells a clear story: the RRF needs an injection of tens of billions of dollars.

Clearly, $28.6 was nowhere near enough to award every eligible restaurant and bar with a grant.

In fact, the RRF would need at least another $50 billion to serve all eligible applicants.

The Numbers

First, the Small Business Administration is to be commended for setting up the RRF portal, making the application process clear, and handling applications well.

However, there’s one glaring issue with the RRF and the review and awards process. I’ll get to that in the next section.

Per the National Restaurant Association, more than 362,000 applications were submitted via the RRF portal.

In total, the applications add up to $75 billion in grant requests. Again, the RRF was funded by the government with $28.6 billion. It doesn’t take a mathematician to see that the fund was severely underfunded.

Controversy

Last week, a number of Republican members of Congress sent a letter to the SBA. The gist of their message was that the RRF’s closure was premature. Therefore, the group concluded, non-priority applicants wouldn’t receive grants or even have the opportunity to apply for grants.

In the letter, which can be reviewed here, the authors also took shots at Democrats, the Biden Administration, and undocumented immigrants.

Setting politics aside, the announcement of the RRF’s portal closure was inarguably premature. The application process was first opened on Monday, May 3. For the first 21 days, the SBA announced that while all eligible entities could apply, only priority applicants would be processed and awarded grants.

However, the RRF portal closed to applications on Monday, May 24…21 days after it first opened. The members of Congress who penned the letter to the SBA have a point: the SBA closed the RRF portal after only operating within the priority window.

Now What?

There’s no other way to put this: The RRF needs more funding.

Essentially, it needs twice the funding it had when it was first seeded. There’s zero guarantee that Congress will address this matter, but at least a handful of lawmakers are aware of the dire situation.

Two weeks ago, the NRA launched a petition urging the government to replenish the RRF. Of course, the RRF also needs to be reopened for applications, and the application process needs to be open to all eligible applicants.

There’s no promise the petition will achieve the desired result but we must do something. Click here to sign the petition and tell Congress the RRF needs to be replenished and reopened.

Image: Karolina Grabowska from Pexels

by krghospitality krghospitality No Comments

House Passes $1.9B Covid Relief Bill, RRF

House Passes $1.9B Covid Relief Bill, RRF

by David Klemt

US Capitol Building Dome

The Senate version of the American Rescue Plan Act of 2021 is through the House, awaiting the signature of President Joe Biden.

Once the bill is signed by the president, it will be the law of the land.

That means our industry is finally receiving at least a portion of the relief it so desperately needs. After nearly a year of campaigning and fighting, the Restaurant Revitalization Fund (RRF) is a reality.

Restaurant Revitalization Fund

Managed by the Small Business Administration properly, the RRF is a critical lifeline for small- and mid-sized operators.

The SBA will prioritize women- and veteran-owned and operated businesses for the first 21 days. Economically and socially disadvantaged businesses will also receive priority.

Maximum grant amounts are $5 million per individual restaurant or $10 million per restaurant group.

Eligible Expenses

Importantly, eligible expenses fall between February 15, 2020 through December 31, 2021.

Eligible expenses include but are not limited to:

  • payroll and benefits;
  • mortgage (no prepayment);
  • rent (no prepayment);
  • utilities, maintenance;
  • supplies (including PPE and cleaning materials);
  • food;
  • operational expenses;
  • covered supplier costs (as defined by the SBA under the PPP program); and
  • sick leave.

American Rescue Plan Provisions

Of course, the RRF is just a small portion of the American Rescue Plan. The bill includes many provisions for national Covid-19 testing and vaccine distribution.

States and local governments receive $20 billion to assist low-income households with rent, utility bills, and back rent. There’s an increase to benefits of 15 percent through September for those on food stamps.

Also, the Emergency Injury Disaster Loan (EIDL) program receives $15 billion, which will help small business owners.

The $300-per-week federal boost to unemployment benefits remains the same rather than climbing to $400 per week.

Crucially, the bill waives the first $10,200 of unemployment benefits from 2020. That amount rises to $20,400 for married couples. To receive the waiver, a household must have an adjusted gross income of $150,000. That AGI is the same for individual and combined households.

Individuals with an AGI of up to $75,000 will receive stimulus payments of $1,400. That amount phases out completely at $80,000 for individuals, $160,000 for couples.

What’s Next

The SBA is responsible creating and implementing the RRF application process.

For now, it’s wise for operators to calculate their grant amounts:

  • Open prior to 2019: 2019 revenue minus 2020 revenue minus PPP loans.
  • 2019 opening: Average of 2019 monthly revenues times 12 minus 2020 revenues.
  • 2020 opening: Eligible to receive funding equal to eligible expenses incurred.

Since the SBA is the agency overseeing the $28.5 billion RRF, it’s a good idea to monitor their site for pertinent dates, details and requirements.

Image: Joshua Sukoff on Unsplash

by David Klemt David Klemt No Comments

Senate Boosts RRF to $28.6 Billion

Senate Boosts RRF to $28.6 Billion

by David Klemt

Lower-case neon open sign

On Saturday, the Senate approved their version of the $1.9 trillion Covid-19 relief bill along party lines.

Next, the bill will go back to the House and could receive a vote as early as tomorrow.

Boost to RRF?

According to several sources, the Senate’s version of the American Restaurant Plan Act (ARPA) includes a $3.6 billion boost to the $25 billionRestaurant Revitalization Fund (RRF).

If that’s accurate and the House passes this version of the ARPA, the RRF has $28.6 billion to disburse.

Five billion dollars will be set aside specifically for businesses that grossed less than $500,000 in receipts in 2019.

Mostly a Good Start?

The RRF is modeled on the RESTAURANTS Act.

Unfortunately, it isn’t funded like the RESTAURANTS Act. The industry has been campaigning for nearly a year for a $120 billion fund.

More than 110,000 restaurants and bars have been lost throughout the United States permanently. In addition, the industry has lost around $220 billion in sales.

The RRF isn’t even a quarter of what the industry was asking for in terms of help from elected officials.

Still, if managed properly, the RRF is much-appreciated and much-needed relief for small and mid-sized operators.

The Details (So Far)

The Small Business Association (SBA) will manage the RRF. For the first 21 days, businesses owned or controlled by women or veterans—or that are economically and socially disadvantaged—will be prioritized for grants.

Maximum amounts for grants are $5 million per individual restaurant or $10 million per restaurant group.

Established restaurants can calculate their grants thusly: 2019 revenue minus 2020 revenue minus PPP loans. For restaurants that were opened in 2019, the calculation is the average of 2019 monthly revenues times 12 minus 2020 revenues. Restaurants opened in 2020 are eligible to receive funding equal to eligible expenses incurred.

Grants can be spent on eligible expenses from February 15, 2020 through December 31, 2021. However, the SBA may extend that period through two years from enactment.

Eligible expenses include but are not limited to:

  • payroll and benefits;
  • mortgage (no prepayment);
  • rent (no prepayment);
  • utilities, maintenance;
  • supplies (including PPE and cleaning materials);
  • food;
  • operational expenses;
  • covered supplier costs (as defined by the SBA under the PPP program); and
  • sick leave.

The fight for relief isn’t over. Please click here to tell your representatives to pass ARPA and the RRF immediately.

Image: Finn Hackshaw on Unsplash

by David Klemt David Klemt No Comments

What’s in the Senate Relief Package?

What’s in the Senate Relief Package?

by David Klemt

United States Capitol Building rotunda ceiling painting

As expected, the Senate version of the latest Covid-19 relief bill is different from the one passed by the House.

The changes will require the bill to be kicked back to the House, adding to the pressure to get relief to Americans before March 14.

Things may change but below are some of the differences between the two versions.

$15/hour Minimum Wage

This provision is dead in both houses of Congress.

That should come as no surprise as the boost to federal minimum wage was declared dead in the water by Senate Parliamentarian Elizabeth MacDonough even before the House voted on the American Rescue Plan Act.

According to reports, removing any and all language that raises federal minimum wage to $15 an hour is the biggest change between the House and Senate versions of ARPA.

Direct Payments to Americans

Chatter online indicates that Senate Democrats are in favor of a drastically lower threshold for $1,400 direct stimulus payments.

The House version of the American Rescue Plan Act of 2021 calls for $1,400 economic impact payments with the following parameters:

  • Individuals earning an adjusted gross income (AGI) up to $75,000.
  • Married couples earning an AGI up to $150,000.
  • Payments phase out, reaching $0 for individuals earning AGI over $100,000 and married couples earning AGI over $200,000.

The Senate version calls for $1,400 payments to phase out entirely for individuals earning an AGI of $80,000 and married couples with an AGI of $160,000.

Restaurant Revitalization Fund

Let’s be honest, this is why you’re here. Is the RRF safe?

There’s nothing that shows the $25 billion fund is in danger from the Senate. That said, there’s one threat to ARPA in general, “minor” as it may be: game-playing politicians.

Unsurprisingly, Republicans view ARPA as too expensive, too favorable of Democrat’s priorities, and insufficient for addressing the reopening of businesses, schools, and fighting Covid-19.

Those concerns in and of themselves aren’t akin to playing games, nor are they invalid. Vote-a-rama, however, is a time-wasting stalling tactic that allows senators to propose literally hundreds of amendments to a bill. The time limit for vote-a-rama? There isn’t one—it lasts until senators get tired or bored.

Speaking about a coordinated plan to engage in vote-a-rama, Senator Rand Paul (R-KY), said he’s “hoping for infinity. There are people talking about trying to set up a schedule and having it go on and on.”

Take Action

Americans simply do not have time for politicians on any side of the aisle to play games. Good-faith negotiations are one thing, delay tactics that last for “infinity” are another.

We’re still in the midst of a pandemic, people are unable to pay their bills, they’re going hungry, and business owners and their employees are suffering.

It seems some politicians have made up their minds and are committed to dragging out the process of passing ARPA and the RRF contained within but we still have our voices. Follow this link to tell your representatives to pass ARPA and RRF now.

Enough games, enough delays, more action.

Image: GO Educational Tours from Pixabay 

by David Klemt David Klemt No Comments

Restaurant Revitalization Fund Passes

Restaurant Revitalization Fund Passes

by David Klemt

United States Capitol Building

Congress has once again voted to pass targeted relief for restaurants and bars.

The American Rescue Plan Act of 2021, which includes the Restaurant Revitalization Fund Passes, made it through Congress by a vote of 219 to 212.

All Republicans and two Democrats voted against the $1.9 billion bill, which now goes to the Senate.

Now What?

After a year of being mostly left to fend for ourselves—save for the flawed Paycheck Protection Program—operators may finally receive some relief.

The $300-per-week federal boost to unemployment, which the American Rescue Plan Act increases to $400 per week, expires on March 14. There’s some pressure on the Senate to pass the bill so it can be signed into law before or by that date.

However, we’ve been down this road before: Congress has voted in favor of a bill that contains relief for restaurants, bars and other foodservice and drinking establishments, the Senate goes a different direction, and the Congressional victory turns to ashes in our hands rather than becoming law.

Democrats control the House. A Democrat sits at the Resolute Desk. And while the 50-50 Senate is “controlled” by Democrats since Vice President Kamala Harris can break tie votes, the party can’t afford any defections if they hope to pass the American Rescue Plan.

Once again, targeted relief isn’t a certainty.

What’s in the Plan?

In short, not the RESTAURANTS Act. The American Rescue Plan provides a fraction of the $120 billion for which the industry has been campaigning for a year now.

Instead, a $25 billion grant program called the Restaurant Revitalization Fund (RRF) has been carved out for restaurants, bars and other eligible providers of food and drink.

There’s another $15 billion allocated for targeted Economic Injury Disaster Loan (EIDL) advance payments, and $1.25 billion for shuttered venue operators.

Just $7.25 billion would be pumped into the PPP and the application deadline wouldn’t be extended beyond March 31. This is likely because the PPP has disbursed over $662 billion in just under a year, and there’s still roughly $140 billion available.

In addition, the current bill includes $1,400 direct stimulus payments for individuals earning up to $75,000 or $2,800 for married couples earning up to $150,000. Payments would phase out completely for individuals earning $100,000 or married couples earning $200,000.

What’s the Restaurant Revitalization Fund?

The RRF carves out $25 billion for restaurants, bars, saloons, inns, taverns, lounges, tasting rooms, brewpubs, taprooms, food trucks, food carts, food stands, caterers, and eligible providers of food and/or drink.

Grants, should the bill pass the Senate and be signed into law, will be equal to pandemic-related revenue loss as calculated by subtracting 2020 revenue from 2019 revenue. Eligible entities could receive of up to $10 million, or a physical location could receive a maximum grant of $5 million.

RRF grants are required to be used for:

  • payroll costs;
  • principal and interest payments on a mortgage, excluding prepayments on the principal;
  • rent payments, excluding prepayments;
  • utilities;
  • supplies, including personal protective equipment (PPE) and cleaning materials;
  • F&B expenses within the eligible entity’s scope of “normal business practice” before the covered period: February 15, 2020, through December 31, 2021 (or another date as determined by the Small Business Administration);
  • maintenance expenses, including construction accommodating outdoor seating and walls, floods, deck surfaces, furniture, fixtures, and equipment;
  • covered supplier costs;
  • operational expenses;
  • paid sick leave; and
  • any other expenses the SBA determines to be essential to maintaining the eligible entity.

The SBA would be responsible for awarding $20 billion of the $25 billion fund in “an equitable manner to eligible entities of different sizes based on annual gross receipts.” The remaining $5 billion would be set aside, per the bill in its current form, for eligible applicants with 2019 gross receipts of $500,000 or less.

Click here to find your senators and urge them to pass the Restaurant Revitalization Fund.

Image: Jens Junge from Pixabay 

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