Arguably one of the hardest hit industries in the United States during the COVID-19 pandemic has been the restaurant industry. Restaurants, bars, caterers, and even food trucks and food stands have felt the crippling effect of the pandemic, and the SBA is rolling out a program called the Restaurant Revitalization Fund (RRF) that is aimed to help these hard-hit businesses get back on their feet.
On March 11, 2021 the American Rescue Plan Act (ARPA) became law, establishing the RRF, and appropriating $28.6 billion for the SBA to award funding to restaurants and bars, and other similar businesses in need. For a full list of requirements, and rules of eligibility, please visit the SBA website at www.sba.gov/funding-programs.
The SBA lists eligible businesses as businesses that are not permanently closed and includes businesses where the public or patrons assemble for the “primary purpose of being served food or drink.” Some examples include restaurants, bars, food trucks, food stands, caterers, bakeries, inns, brewpubs, wineries, distilleries, or tasting rooms, among others.
In order to meet the statutory requirement for “place of business in which the public or patrons assemble for the primary purpose of being served food or drink,” the SBA states on its website that “an eligible entity must have at least 33% in 2019 on-site sales to the public. The original business model of eligible entities that opened in 2020 or that have not yet opened should have contemplated at least 33% of gross receipts in on-site sales to the public.”
The applicant must also certify that the current economic climate makes this funding request necessary and that the applicant does not have a pending application for, nor has it received a Shuttered Operator grant from the SBA.
There is a minimum threshold of $1,000 per location and a maximum of $5,000,000 per location ($10,000,000 in the aggregate including all affiliates regardless of location), so there is a large window for all types and sizes of businesses to receive funds. The SBA provides detailed guidance on its website as to how the applicant should calculate its requested funding, and the eligible uses for which applicants can spend the funds, which is similar to the use of proceeds requirements under the Paycheck Protection Program. It should be noted that the amount of any PPP loans received by the applicant will be deducted from the RRF grant amount.
Applicants who receive RRF funds have until March 11, 2023 to use all of the received funds, and must file annual reports with SBA, no later than December 31st of each year, until all RRF funds have been spent. The funding remains available until all program funds have been expended, and the SBA will continue to accept applications subject to the availability of funds.
As the RRF is still being rolled out, we will undoubtedly receive more information and guidance from SBA as the program continues. For more information regarding the RRF and other COVID-19 relief programs from the SBA, contact Tim at email@example.com or 215-542-7070.
Comments are closed.