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Restaurants devastated by the coronavirus outbreak are getting a lifeline from the pandemic relief package awaiting final approval in the House.
The bill passed by the Senate on Saturday adds money to the salary protection program and provides indirect assistance to small businesses in general through incentive payments and unemployment benefits. But restaurants received the bulk of direct aid: $ 28.6 billion in allowances for restaurants whose revenues fell in 2020 as a result of the pandemic.
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The bill calls for grants equal to the amount of loss of revenue, up to a maximum of $ 10 million per company and $ 5 million per place. Qualifying companies can not own more than 20 places, and they can not be traded in public. The bill sets aside $ 5 billion for the smallest restaurants, those whose annual revenue is $ 500,000 or less.
Industry groups welcomed the grants. The National Restaurant Association, an industry organization, noted that the Senate has added $ 3.6 billion to the $ 25 billion allocated in the original House Bill. While the $ 28.6 billion in the account was only about a tenth of the amount of money the industry lost during the pandemic, the restaurant group considers it a profit.
“It’s going to keep doors open. The smallest and hardest hit will get the help they needed most, “said Sean Kennedy, the group’s executive vice president.
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Restaurants were devastated by the pandemic that led to closures ordered by the government, and which still keeps many eateries away. According to the National Restaurant Association, on December 1, more than 110,000 American restaurants were temporarily or permanently closed. This is 17% of the number of restaurants operated before the pandemic. The group fell more than 16% in the industry in January.
Small business advocates welcomed the overall bill and said the $ 1,400 incentive payments to individuals and families as well as continued unemployment benefits would give consumers more money to spend on small businesses.
“Every time you put money in the hands of consumers, no matter how it gets there, it helps small businesses,” said Keith Hall, president of the National Association for the Independent, saying that mainstream businesses like hair salons are likely to benefit.
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Congress added more than $ 7 billion to the $ 800 billion allocated to the latest round of the EMP, which began on January 11. The Small Business Administration has so far approved about $ 680 billion in loans during this round, a total of $ 1.2 billion since April.
But advocates for small businesses are concerned because the program did not extend the program, which is scheduled for March 31. Congress could still extend the PPP – it was previously extended to two earlier rounds of funding – but Karen Kerrigan, president of the Small Business & Entrepreneurship Council, called the bill a ‘missed opportunity’ to improve the alleviation of small pandemics.
Kerrigan was also concerned that lawmakers have not raised a $ 150,000 limit on disaster loans for economic injuries in SBA that many companies sought during virus outbreaks.
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The bill also includes $ 100 million for SBA-sponsored small business development centers and other organizations that provide free advice and training to small businesses. It also includes $ 10 billion for the State Small Business Credit Initiative, a program aimed at helping states support loans to small businesses.
Kerrigan was optimistic that the bill would have a positive effect on the economy and small businesses.
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“We expect an overall increase that can boost the momentum and confidence that is building in Main Street,” she said. But she warned, rather than spend their stimulus payments, many individuals and families will use the money to save or pay off debt.
“Therefore, small businesses need to continue to compete fiercely for available consumer dollars,” she said.