Restaurant Revitalization Award Portal Launches
Restaurant Revitalization Award Portal Launches
- Rahul Chugh
- May 3, 2021
To begin the application process at the Restaurant Revitalization Award Portal, visit the official website. This portal will help you calculate your eligible award amount, monitor status, and interact with the SBA. Read below for more information and background of how it all came together.
After a year of heavy lifting by a group of independent restaurateurs, the money committed to the Federal Restaurant Revitalization Fund is ready to be accessed. The RRF provides financial relief for eligible restaurants and related food and beverage service businesses with $28.6 billion of tax-free federal grants if their revenue in 2020 was less than their revenue in 2019. The SBA is the administrator of the RRF.
SBA Administrator Isabella Casillas Guzman announced the U.S. Small Business Administration began registrations on Friday, April 30, 2021, at 9 a.m. EDT and open applications on Monday, May 3, 2021, at noon EDT at the Restaurant Revitalization Award Portal. The online application will remain open to any eligible establishment until all funds are exhausted. There is also a phone application portal at (844) 279-8898.
“Restaurants are the core of our neighborhoods and propel economic activity on main streets across the nation. They are among the businesses that have been hardest hit and need support to survive this pandemic. We want restaurants to know that help is here,” said Administrator Guzman. “The SBA has focused on the marketplace realities of our food and beverage businesses in designing the Restaurant Revitalization Fund to meet businesses where they are. And we are committed to equity to ensure our smaller and underserved businesses, which have suffered the most, can access this critical relief, recover, and grow more resilient.”
Established under the American Rescue Plan, and signed into law by President Joe Biden on March 11, 2021, the Restaurant Revitalization Fund provides a total of $28.6 billion in direct relief funds to restaurants and other hard-hit food establishments that have experienced economic distress and significant operational losses due to the COVID-19 pandemic. This program will provide restaurants with funding equal to their pandemic-related revenue loss up to $10 million per business and no more than $5 million per physical location. Funds must be used for allowable expenses by March 11, 2023.
“Recognizing the great urgency to help restaurants keep their doors open – and with a clear mandate from Congress – the SBA worked at a breakneck speed and is excited to launch this program,” said Patrick Kelley, SBA Associate Administrator, Office of Capital Access. “From day one, we engaged with diverse stakeholders in the food industry community to make sure we built and delivered the program equitably, quickly, and efficiently.”
Singer M. Tucker February 2021 728×90
In preparation, the SBA recommends qualifying applicants familiarize themselves with the application process in advance of visiting the Restaurant Revitalization Award Portal to ensure a smooth and efficient application experience, specifically by:
Registering for an account in advance at restaurants.sba.gov starting Friday, April 30, 2021, at 9 a.m. EDT.
Reviewing the official guidance, including program guide, frequently asked questions, and application sample.
Preparing the required documentation.
Working with a point-of-sale vendor or visiting restaurants.sba.gov to submit an application when the Restaurant Revitalization Award Portal opens. [Note: If an applicant is working with a point-of-sale vendor, they do not need to register beforehand on the site.]
For the first 21 days that the program is open, the SBA will prioritize funding applications from businesses owned and controlled by women, veterans, and socially and economically disadvantaged individuals. All eligible applicants are encouraged to submit applications as soon as the Restaurant Revitalization Award Portal opens. Following the 21 days, all eligible applications will be funded on a first-come, first-served basis.
Many feel that it was a New York connection that integral is the passage of the program. The Independent Restaurant Coalition was anchored by Manhattan chef/restaurant owners including Amanda Cohen and Tom Colicchio. They spent countless hours pushing for the passage of the funding. Early on they found the support of Chuck Schumer (D-NY). With the election of Joe Biden to the presidency this past November, Schumer ascended to the Senate Majority Leader position. That proved vital to the cause as they IRC essentially had to resell the entire program for a second time with the changes in Washington.
“It was a long, hard road, but we got there. We got there,” Schumer noted.
Most importantly as a New Yorker with his understanding of the import of the industry to the New York city and the nation’s economy, he has promised to replenish the funding should it run out as expected. As far as getting the funds, Schumer is confident the process will run more smoothly than the first round of Paycheck Protection Program loans last April and says the Small Business Administration is ready to get the money out quickly and fairly, while making it easy for restaurant owners to apply.
Restaurants, food stands, food trucks, food carts, caterers, saloons, inns, taverns, bars, lounges, bakeries, brewpubs, tasting rooms and taprooms that earned at least a third of their revenues from the sale of food and beverages consumed on site; licensed facilities or premises of beverage alcohol producers where the public may taste, sample, or purchase products; and other similar places of business in which the public or patrons assemble for the primary purpose of being served food or alcohol, will be eligible for grant proceeds. Franchisees of franchise systems with more than 20 units are eligible if their franchisors are listed on the SBA Franchise Directory.
Businesses not eligible for RRF relief include those that have permanently closed and those operating under bankruptcy protection without a submitted or approved plan of reorganization, state and local government-owned establishments, publicly traded companies, businesses with more than 20 locations (including affiliates) as of March 13, 2020, and businesses that received grants under the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act.
Consistent with the legislation and the intent of Congress, the SBA continues to take steps to ensure the equitable distribution of relief, particularly for the smallest businesses, by creating a $9.5 billion set-aside: $5 billion for applicants with 2019 gross receipts of not more than $500,000; $4 billion is set aside for applicants with 2019 gross receipts from $500,001 to $1,500,000; and $500 million for applicants with 2019 gross receipts not more than $50,000.
It’s also interesting to note, what types of establishment are not eligible upon visiting the Restaurant Revitalization Award Portal. These include: permanently closed establishments, Publicly traded companies (but franchisees are eligible)and venues that have a received a shuttered venue operators grant or that have an application pending. An entity that owns and operates together with affiliated businesses more than 20 locations, whether under the same or multiple names. This should technically exclude some of the country’s largest independent restaurant groups.
Among the most interesting question is how restaurants can use the grant funds. They can be used for payroll (including health care), rent and utilities, mortgage obligations (including principal and interest), outdoor dining builds and other construction costs, supplier costs, operational expenses, paid sick leave, and any other expenses that the SBA administrator “determines to be essential to maintaining the eligible entity,” according to the March stimulus bill. Restaurants will also be able to use funds to pay off business-related credit card expenses, third-party delivery commissions, unforgiven portions of PPP loans, propane for food trucks, and insurance for food truck vehicles, the SBA said during various town halls this week.
The inclusion of mortgage principal is key, as the PPP only allowed for payment of mortgage interest. That means bars and restaurants finally have a way to pay down significant long-term debts, which they might have incurred well before the pandemic through kitchen renovations or initial build-outs. Small operators who maxed out their credit cards will be able to take care of that debt as well. “Don’t forget to prepare a promissory note,” noted Stacy Gilbert of Citrin Cooperman, “and pay yourself back what you lent to your business personally.” Supplier payments are another important inclusion, as restaurant closures and operating restrictions have wreaked havoc on vendors and other parts of the larger food supply chain.
To begin the application process at the Restaurant Revitalization Award Portal, visit the official website.
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