If you own a restaurant, your business has probably suffered financially this last year due to COVID. Restaurants all over the nation have experienced loss because people have been fearful of being close to someone who may have the virus. Now, there is a way that you can get some cash from the government to help your restaurant recover from last year’s losses.
The New Restaurant Revitalization Fund
The new program is part of the third stimulus package that Congress enacted. It is just now making this source of cash – $28.6 billion – available to restaurants and food businesses through the Small Business Administration (SBA). The program is called the Restaurant Revitalization Fund (RRF).
The government recognizes that restaurants have been one of the hardest-hit industries in the United States. They acknowledge that restaurants and various food vendors are vital to the economy of the nation.
The Eligible Applicants
Applicants for the RRF money can be from nearly any type of food business, but there are a couple of requirements for some businesses. Restaurants, caterers, food trucks and carts, and bars can apply with no restrictions. Businesses such as inns, bakeries, breweries, wineries, distilleries will need to have at least 33% of their gross receipts come from the sale of food and/or beverages.
What Affects the Award Amount?
If you have applied for other stimulus money given through the various stimulus packages, there may be a limit as to how much money you may receive. For instance, if you have already received money from the Paycheck Protection Program (PPP), it will limit the funds you are eligible from the RRF.
Restaurant owners that have applied for COVID-19 Economic Injury Disaster Loans (EIDL) can also apply for the RRF. If you have already applied for a Shuttered Venue Operators Grant you cannot apply for money from the Restaurant Revitalization Fund. Once you apply for money from the RRF, you cannot apply again.
How the Award Amount Is Determined
Applicants can choose one of three methods of calculations, but it will depend on their situation. You will start with the total receipts for 2019 and then subtract the receipts for 2020. After that, you will need to subtract any loans received through the Paycheck Protection Program. The total amount that can be received from a single location is $5 million, and restaurants with multiple locations can receive up to $10 million.
After May 3rd, only applications from priority groups will be considered for the first 21 days. This group includes veterans, women, and individuals that are either socially or economically disadvantaged. After the 21st day, all other applications will be considered,
How the Money Can Be Used
Just like the PPP, there are some restrictions on how the money can be used. Most of the conditions are the same as the PPP, enabling restaurant owners to use the money for the daily conduct of their regular expenses and debt. The money cannot be used for making prepayments on rent or the prepayment of principal and interest on loans.
The restaurants that receive funding from the RFF do not need to repay the money. The money will need to be used before March 11, 2023.
Applications will begin to be accepted starting April 30, 2021, at 9:00a.m. They will continue to be accepted until all of the funds have been claimed. The Fund will start examining applications on May 3rd. Applications can be filled out at https://restaurants.sba.gov, or through cooperating approved Point of Sale vendors such as Square, Clover, Toast, and Aloha.