How small restaurants can still get assistance from the Restaurant Revitalization Fund

Recently, when visiting Santa Fe, New Mexico, I stopped for lunch in the Palacio Café, a small restaurant near the main plaza. I was on what my friends called my “green chili chicken enchilada journey” – having fallen in love with New Mexico green chili. As I travel, I always try to check in with small business owners to see how they’re doing, so I asked the café’s owner, Damian Muñoz, how the COVID-19 pandemic had been for him.

“Devastating,” was his answer.

I asked him whether he got any financial help from the government, hoping Muñoz had at least received a Paycheck Protection Program (PPP) forgivable loan. But like many small business owners, Muñoz knows how to run his business, but doesn’t know how to navigate government red tape.

“No – I’m terrible at paperwork,” Muñoz told me.

Restaurants, bars, brewpubs and the like were among the hardest hit companies in the pandemic, and these industries are dominated by small businesses that could least afford the hit.

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Muñoz, for example, while fortunate to stay in business, says he lost more than 75% of his income while his rent and utilities and other expenses remained.

To try and save businesses like the one Muñoz owns with his wife Maria – and where they both work 14-hour days six days a week– President Joe Biden included the Restaurant Revitalization Fund as part of the American Rescue Plan.

The fund includes $28.6 billion in grants – not loans – for food and beverage serving businesses to help make up their losses in 2020. And there’s help from Small Business Development Centers to help those like Muñoz who have trouble applying for such help.

Unfortunately, while applications only opened up the beginning of May, those funds have now basically run out (there’s an exception for very small businesses – keep reading). In fact, the Small Business Administration received more than 266,000 applications totaling over $65 billion in funds. According to the SBA, about half of the applications came from veterans, women, and socially and economically disadvantaged business owners.

 (Photo: Getty Images)

Can you still apply?

Given the overwhelming response, the SBA is now limiting applications only to qualified small businesses with a total of $50,000 in gross receipts or less in 2019. However, there’s a move to replenish the fund to help additional restaurants, bar and brewpub owners survive and revive.

Is this a loan?

No. Here’s the language from the SBA site: “Recipients are not required to repay the funding as long as funds are used for eligible uses no later than March 11, 2023.”

How much can you get?

2019 gross receipts (not profit) minus 2020 gross receipts minus PPP loan amounts.

If you started business in 2019 or 2020, there are other formulas.

Who qualifies?

Companies that were serving food and/or beverage to the public, primarily on-site – on their premises, including restaurants, food trucks and carts, bars, snack bars, microbreweries; and caterers, wineries, inns and distilleries where onsite sales to the public comprise at least 33% of gross receipts. You must not be permanently closed. You can have no more than 20 locations. Non-profits are not eligible.

What can the money be used for?

You can use the funds for just about any normal business expense: payroll, rent, utilities, food, supplies, loan payments, marketing, equipment, licenses and more. You can also use the money for construction of outside seating areas. And this covers expenses from Feb. 15, 2020 to March 11, 2023!

How to apply

If you qualify – less than $50,000 in gross receipts in 2019, apply through any one of these:

With the recent lifting of the mask mandate for vaccinated individuals, more Americans (like me) are starting to travel. Hopefully, soon the Palacio Café will once again be filled with customers enjoying Muñoz’s green chile chicken enchiladas or another meal in the charming, flower-filled courtyard.

But the Restaurant Revitalization Fund will help and deserves to be revitalized itself. If you own a restaurant, bar, food truck, brewpub or the like – or you care about someone who does – let your Congressperson and Senator know that you’d like the Restaurant Revitalization Fund expanded.  

Rhonda Abrams is one of America’s leading small business experts and author of the book “Successful Business Plan: Secrets & Strategies.” Connect with Rhonda on Facebook, Instagram and Twitter. Register for Rhonda’s free business tips newsletter at www.PlanningShop.com.

The views and opinions expressed in this column are the author’s and do not necessarily reflect those of USA TODAY.

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