The restaurant industry is finally getting its own salvation – but whether there is enough to go around remains an open question.
Last week, President Biden signed a $ 1.9 billion coronavirus relief and stimulus package that includes $ 28.6 billion earmarked specifically for the struggling restaurant industry. It is the largest single financial relief program ever targeted at the U.S. restaurant sector.
To be eligible, restaurants with less than 20 locations must deduct their 2020 income from their 2019 income and submit their applications for the difference – minus any funding the Paycheck Protection Program received last year. The administration for small businesses is expected to start in the coming weeks.
The problem is that the process is expected to be slow – and even with 110,000 restaurants closed last year, not enough money has been set aside to cover the estimated $ 255 billion in total losses suffered by the food services industry last year. to make. of the pandemic, experts said.
“It’s a great start, but it’s going to take five seconds,” said restaurant consultant Rick Camac.
Erika Polmar, executive director of the Independent Restaurant Coalition, says he will request that the pool be renewed until everyone is paid. Meanwhile, restaurateurs are worried that they could be left out of the cold in the cold, even if they dream of what they can do with the money.
Ayala Donchin, CEO and CEO of Evelyn’s Kitchen in Harlem, was one of those who missed the first round of PPP funding as banks that partnered with the SBA hand out funds to large, established companies such as the Los Angeles Lakers and Ruth’s Chris. Steak House.
Donchin, who called the first round ‘extremely demoralizing’, managed to weaken subsequent rounds of PPP funding, but the money was – by law – reserved for payroll.
If she uses a piece of the restaurant’s lifeline that can be used on almost any business expense – from rent, to supplies, to food and improvements – she plans to use it to fix her crumbling infrastructure and extend her online sales brei.
‘The ovens. The lighting. A sign on the front. “Cabinet doors that are broken – and adding packaging to expand our ability to ship items nationally,” Donchin said.
Still, she’s worried. “We do not have the money yet. And it may not come in eight to twelve weeks. We are still in survival mode and there is no way to plan without having the money. ”
Biden promised that the application process would open within weeks, not months. But even after it begins, the process is expected to be delayed by efforts to eliminate some of the issues plaguing the first-round PPP loans.
For the first three weeks, the SBA will give preference to restaurants considered by women, veterans and everyone else who are socially and economically disadvantaged.
For the first two months, only restaurants that brought in less than $ 500,000 in annual revenue in 2019 need apply. After that, individual restaurants can apply for up to $ 5 million, and restaurant groups can apply for up to $ 10 million.
Money not spent by the end of the year must be returned.
Restaurateur James Mallios, owner of the Greek restaurant Amali in Midtown and Bar Marseille in the Rockaways, said he would use the money to hire more staff and build more outdoor seating – as well as rebuild wine lists. after freezing the purchases for almost a year. ‘
He calls the act a ‘lifeline’, though he knows the money may run out before he gets it. “I hope we receive our grant, but even if we do not make more funds available, it gives us emotional wind in our sails.”
Restaurants and bars in New York feel more optimistic after a harsh winter in general. The indoor dining room, which resumed at 25 percent in February, is now at 35 percent and at March 19 at 50 percent.
But they are still hurting. There were 25,000 places to eat and drink in the city before the pandemic hit. About 5,000 of those bars and eateries closed during the pandemic, according to the Partnership of New York.