Almost exactly one year since the pandemic’s official declaration and restaurants began shutting down; the U.S. Congress voted to approve the American Rescue Plan, which includes restaurant-specific relief that small and independent restaurants deserve after closures, increased costs and decreased revenues have threatened their ability to stay in business for nearly a year.
As of press time, President Biden is expected to quickly sign the bill, setting the Small Business Administration stage to administer the restaurant-specific grant program known as the Restaurant Revitalization Fund (RRF).
After the U.S. House voted on the bill on March 1, the Senate increased the amount of money for restaurants from $25 billion to $28.6 billion. The funding will split into government-funded grants with a maximum of $10 million per restaurant group or $5 million per individual restaurant location. Independent restaurants and bars have priority for receiving grants. If they are not part of an affiliated restaurant group, have under 20 locations, and are not publicly traded, they can apply for funds.
For restaurants that opened in 2018 or earlier, grants will be calculated by subtracting a business’s 2020 revenue from their 2019 revenue and subtracting first- and second-draw PPP loans received in 2020. For restaurants that opened in 2019, the average 2019 monthly revenues will be multiplied by 12 minus the average 2020 monthly revenues multiplied by 12. The first- and second-draw PPP loans received will also be subtracted.
If a restaurant opened in 2020, it is eligible to receive funding equal to the eligible expenses incurred minus those first- and second-PPP loans received. There’s good news for restaurants who plan to open this year – they are also eligible to receive, according to the bill, “funding equal to eligible expenses incurred before the date of enactment.”
Once President Biden signs the bill and the SBA opens up applications, restaurants and bars with under 20 locations that can show revenue loss over the past year can apply through the Small Business Administration (SBA). You can also find additional information about how you can prepare to apply for these grants on the Independent Restaurant Coalition’s website at saverestaurants.com in the Resources/Grants Help section.
