Struggling Independent Restaurants and Bars Praise Congressional Champions for demanding Small Business Administration release remaining Restaurant Revitalization Funds
Government Accountability Office report indicates $180 million funds unobligated
WASHINGTON D.C. (November 1, 2022) – Today, Reps. Earl Blumenauer (D-OR-3) and Brian Fitzpatrick (R-PA-1) and Sens. Roger Wicker (R-MS) and Kyrsten Sinema (D-AZ) sent a letter requesting that the Small Business Administration (SBA) swiftly release all unobligated funds from the Restaurant Revitalization Fund (RRF) authorized under the American Rescue Plan Act to eligible applicants. The IRC’s continued advocacy for independent restaurants and bars has resulted in our Congressional champions taking action and issuing this letter, which requests that the agency prioritize the program and provide relief to the nearly seven thousand applicants that were identified as grant awardees in 2021 but never received funding.
In July 2022, the Government Accountability Office (GAO) released a report entitled Restaurant Revitalization Fund: Opportunities Exist to Improve Oversight that revealed that as of June 2022, $180 million of RRF funds remained unobligated. After learning of this, the IRC immediately met with Congressional leaders seeking their assistance and urging the SBA to release the funds to help the thousands of small business owners waiting for relief.
"As long as locally owned restaurants and bars are still hurting, we will keep fighting," said Erika Polmar, Executive Director of the Independent Restaurant Coalition. “The IRC is grateful that Senators Wicker and Sinema and Representatives Blumenauer and Fitzpatrick continue to stand together with unwavering support for our industry. Distributing the remaining and recovered $180 million in funds would be a ray of hope for many neighborhood restaurants and bars that have been on life support for more than two years. When restaurants close, our communities, local economies, and most of all, our workers lose jobs that provide unparalleled ladders of opportunity. Thank you to our champions in Washington who have been working tirelessly to deliver real help to independent restaurants and bars nationwide.”
As a result of COVID-mandated closures and consumer hesitancy to dine out during the pandemic, the restaurant and bar industry lost over $280 billion and only received $28.6 billion in dedicated RRF relief. Within the first three and half weeks of opening the RRF application portal, over 372,000 restaurants, bars, and other eligible businesses applied, requesting over $76 billion in funds. Over half of the applications came from women, Veterans, and socially and economically disadvantaged business owners. Approximately 177,000 restaurants that applied to the program did not receive awards.
In addition to distributing the remaining funds, the letter requires that “the SBA must continue conducting thorough retrieval efforts to recapture funding given to ineligible applicants, accepted fraudulently, or otherwise able to be returned. Once recovered, these dollars must immediately be disbursed to those eligible businesses that have applied for and need these grants.”
The Restaurant Revitalization Fund (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.
This first-of-its-kind grant program provided 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. The grants 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;
- 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.
ABOUT THE IRC:
The restaurant and bar community formed the Independent Restaurant Coalition (IRC) to save the independent restaurants and bars and the 11 million people we employ — and the 5 million workers up and down the supply chain — who are affected by COVID-19. The IRC was founded on the simple belief that our small businesses have the power to affect legislative change if we unite our voices. Our purpose is to build a sustainable future for independent restaurateurs, their employees, and the communities they support.
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