The restaurant industry is finally getting its own rescue, but if there is enough to turn it around, it remains an open question.
Last week, President Biden signed a $ 1.9 trillion coronavirus stimulation and stimulation package that included $ 28.6 billion specifically for the catering industry. It is the single largest financial aid program ever targeted at the U.S. restaurant industry.
To qualify, restaurants with less than 20 locations must subtract the 2020 revenue from the 2019 revenue and submit the difference applications, minus any funding from the Wage Protection Program received last year. The Small Business Administration is expected to begin receiving applications in the coming weeks.
The problem is that the process is expected to be slow, and even with 110,000 restaurants closing last year, there is not enough money set aside to offset the estimated global losses of $ 255 billion suffered by the food industry. food services last year of the pandemic, experts said.
“It’s a good start, but it will take about five seconds,” said restaurant consultant Rick Camac.
Erika Polmar, executive director of the Independent Restaurant Coalition, says she will urge the pool to be renovated until everyone is covered. Meanwhile, restaurateurs worry that they may be left out of the cold despite dreaming of what they could do with the money.
Ayala Donchin, executive chef and CEO of Evelyn’s Kitchen in Harlem, was one of those who lost the first round of PPP funding, as banks that partnered with the SBA allocated funds to large established companies such as the Los Angeles Lakers and Chris de Ruth. Steak House.
Donchin, who called the first round “extremely demoralizing,” was successful in later rounds of PPP funding, but that money was set aside – by law – on the payroll.
If you catch a portion of the restaurant’s ransom, which can be used on almost any business expense (from rent, supplies, food and upgrades), you plan to use it to fix your dilapidated infrastructure and expand your online sales.
“The ovens. The lighting. A front sign. Broken cabinet doors and adding packaging to expand our ability to ship items nationwide, ”Donchin said.
Still, she’s worried. “We do not have the money yet. And it may not arrive in eight to twelve weeks. We are still in survival mode and there is no way to plan without having the money. ”
Biden has promised that the application process will open “in a few weeks, not in months.” But even after it opens, the process is expected to slow down thanks to efforts to eliminate some of the problems that plagued the first round of PPP lending.
For the first three weeks, the SBA will prioritize grants to restaurants owned by women, veterans, and anyone else who is considered socially and economically disadvantaged.
Then, for the first two months, only restaurants that earned less than $ 500,000 in annual revenue in 2019 should apply. Then, individual restaurants can apply for up to $ 5 million and restaurant groups can apply for up to $ 10 million.
Money not spent at the end of the year must be returned.
Restaurateur James Mallios, owner of the Greek restaurant Amali in Midtown and the Marseille bar at the Rockaways, said he would use the money to hire more staff and build more outdoor seating, as well as rebuild wine lists “after ‘having frozen the purchase for almost a year’.
He described the act as “rescue”, despite knowing that the money could run out before he got it. “I hope we get our grant, but even if we don’t and there are no more funds available, it gives us an emotional wind in the sails.”
New York City restaurants and bars feel more optimistic after a generally harsh winter. Indoor dining capacity, which resumed in February with 25%, is now at 35% and rose to 50% on 19 March.
But they still hurt. There were 25,000 establishments to eat and drink in the city before the pandemic hit. According to the Partnership of New York, approximately 5,000 of these bars and restaurants closed during the pandemic.