Hope for the Future: Restaurant Industry Responds to Rescue Plan

President Joseph R. Biden, Jr. signed the American Rescue Plan Act into law creating the $28.6 billion Restaurant Revitalization Fund (RRF),which the National Restaurant Association calls “the most important recovery tool for the industry to date.”

“The creation of the Restaurant Revitalization Fund will be a catalyst to reviving restaurants and saving jobs across the country,” said Tom Bené, President & CEO of the National Restaurant Association. “Our focus from the beginning of this crisis has been on ensuring that our favorite local restaurants could access the assistance they would need to survive. This fund is a win for the smallest and hardest hit restaurants that have sacrificed and innovated to continue to serve their communities.”

The RRF will create a new federal program for restaurant owners with 20 or fewer locations. Operators can apply for tax-free grants of up to $5 million per location, or up to $10 million for multi-location operations. The grant amount is determined by subtracting 2020 sales from 2019 revenues.

This package will be the vehicle for so many small businesses, bars, and restaurants to survive.

Funds from the grants can be spent on a wider range of expenses than previous relief programs, including mortgages or rent, utilities, supplies, food and beverage inventory, payroll, and operational expenses. Five billion dollars of the fund will be set aside for restaurants with gross receipts under $500,000 and, for the first three weeks of the application period, the Small Business Administration will prioritize awarding grants for women-, veteran-, or socially and economically disadvantaged-owned businesses.

“These grants will inject a much-needed stimulus along the supply chain to begin to balance the economic damage done while restaurants have been struggling,” said Bené. “We are still a long way from full recovery and it’s likely more grant money will be needed to get us there, but today the industry has hope for the future.”   

“From the beginning, we knew that the pandemic would be the worst disaster to ever hit to the restaurant industry,” added Sean Kennedy, Executive Vice President of Public Affairs for the National Restaurant Association. “We created a roadmap for Congress and the Administration to tools that already existed but could work better for restaurants, and the plan for creating crucial new support programs like the RRF. These tools created a framework for restaurants of all types and sizes to survive, and now with the RRF in place, they will be the foundation on which we begin to rebuild.”

Get an overview of the Restaurant Revitalization Fund here.
“The heartbreak our industry felt everyday for the past year starts to heal,” said Erika Polmar, Executive Director of the Independent Restaurant Coalition. “The $28.6 billion grant program signed by President Biden today is a gamechanger for people who depend on neighborhood restaurants and bars for their livelihood. Dishwashers, farmers, servers, florists, chefs, and millions of others in this industry will sleep a little easier tonight thanks to Congress and the White House. Independent restaurants and bars put their heads together to make this happen against all odds. Today would not be possible without the support of our champions in Congress– Leader Chuck Schumer, Sens. Roger Wicker and Kyrsten Sinema and Reps. Earl Blumenauer and Brian Fitzpatrick fought with us every day to save restaurants. The IRC will continue working closely with our champions on the Hill and in the White House to ensure the hardest-hit communities are able to access this crucial lifeline.

Restaurant owners and operators worked directly with Senator Wicker (R-MS), and Rep Blumenauer (D-OR 3) to craft the legislation, and mobilized a grassroots movement of over 100,000 people to educate Congress on the legislation and the unique struggles facing the industry. The IRC facilitated hundreds of meetings and calls between people working in restaurants and bars and members of Congress, and sent over 100,000 emails to Congressional offices. In a recent press conference, Senate Majority Leader Chuck Schumer agreed that the IRC’s grassroots efforts were instrumental to providing relief for the industry: “Without the IRC, I don’t know if [the restaurant grant fund] would have gotten done at all.”
“Over the summer, I testified before the House’s committee on Small Businesses on the crisis restaurants were facing, and still are facing,” said Amanda Cohen, IRC co-founder, owner of Dirt Candy in New York City. “In my testimony, I implored Congress to find a way to help independent restaurants. Today, I can confidently say that Congress heard me. The $28.6 billion program for our broken businesses will help countless restaurants, not only survive the pandemic, but will also make them whole again.”
“While the Paycheck Protection Program failed my business, this grant program will keep my doors open,” said Nya Marshall, member of the IRC Leadership Team, owner of Ivy Kitchen in Detroit, MI. “Like so many of my colleagues, my restaurant lost 85 percent of its revenue last year, yet I didn’t receive a nickel from Washington. Today, I am more confident that I will be able to pay my outstanding bills, and employ my full staff once the pandemic ends. I am grateful for my peers in the independent restaurant and bar community, and our champions in Washington, who have been working tirelessly to deliver real help to our devastated industry.”

This critical funding provides hope and optimism for millions of restaurant, bar and craft distillery owners and hospitality workers who have hung in there over the past year waiting for brighter days.

Recently, the IRC invited more than 300 members of the restaurant and bar community to discuss this new relief fund and state of the industry with the White House, including Senior Advisor to President Biden, former Congressman Cedric Richmond and Bharat Ramamurti, the Deputy Director of the National Economic Council. Congressman Richmond said this is “a necessary first step for restaurants and bars, and we look forward to collaborating with the Independent Restaurant Coalition to ensure small businesses can access this relief.”
“This is more than a rescue plan. It is more than a relief package, it is literally a stimulus package that will really have an effect on the entire country’s economy,” said Caroline Styne, IRC co-founder and co-owner of Lucques Group in Los Angeles. “This package will be the vehicle for so many small businesses, bars, and restaurants to survive: everywhere from down south in San Diego, to San Francisco, to Sacramento, and everywhere in between. It will help those who have been unemployed for almost a year now back to their jobs.”
“I am deeply grateful to the IRC, our congressional champions, and the White House for fighting for jobs like mine,” said Pilar Garcia, former General Manager of Wood Fired Cantina in St. Paul, MN. “Thanks to the American Rescue Plan, countless servers, bussers, hosts, managers, chefs, and porters will not be sent to the unemployment line. These grants will lift up the entire restaurant community, and the impact of saving jobs will ripple throughout our national economy. I went into this industry because I am passionate about taking care of others; today, I am grateful our leaders are taking care of us, too.”

“This critical funding provides hope and optimism for millions of restaurant, bar and craft distillery owners and hospitality workers who have hung in there over the past year waiting for brighter days,” said Distilled Spirits Council President & CEO Chris Swonger. “Help is on the way, and with the progress on the vaccine front, these hospitality businesses will begin to bounce back and thrive once again. We commend President Biden and Congress for recognizing the importance of reviving the hospitality industry and the role these businesses play in creating jobs, supporting local communities and bringing people together.”  

Final passage of the bill comes almost exactly one year after the first restaurants were ordered to close and the National Restaurant Association sent a plan to Congress urging the creation of an industry-specific relief program. Since then, foodservice sales have fallen $255 billion and 110,000 restaurants have closed.