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Restaurants devastated by the coronavirus outbreak are coming to life with the pandemic relief package that awaits final approval in the House.
The bill passed by the Senate on Saturday adds money to the Salary Protection Program and provides indirect help to small businesses in general through stimulus payments and unemployment insurance. But restaurants received the largest share of direct aid: $ 28.6 billion in subsidies for restaurants whose revenue fell in 2020 as a result of the pandemic.
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The project provides for concessions equal to the amount of revenue losses from restaurants, up to a maximum of US $ 10 million per company and US $ 5 million per location. Qualified companies cannot have more than 20 locations and cannot be publicly traded. The account reserves $ 5 billion for the smallest restaurants, those whose annual revenue is $ 500,000 or less.
Industry groups welcomed the donations. The National Restaurant Association, an industry organization, noted that the Senate added $ 3.6 billion to the $ 25 billion allocated in the original House bill. Although the $ 28.6 billion in the account represents only about a tenth of the amount the sector lost during the pandemic, the restaurant group sees it as a victory.
“This will keep the doors open. The smallest and hardest hit will get the help they need most, ”said Sean Kennedy, executive vice president of the group.
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Restaurants were wiped out by the pandemic that led to the government’s closure and which still keeps many customers at bay. As of December 1, more than 110,000 restaurants in the United States were closed temporarily or permanently, according to the National Restaurant Association. That is 17% of the number of restaurants in operation before the pandemic. In January, the sector’s revenue fell more than 16% compared to the previous year, the group said.
Small business advocates were satisfied with the overall bill and said the $ 1,400 stimulus payments to individuals and families, as well as continued unemployment benefits, will give consumers more money to spend on small businesses.
“Whenever you put money in the hands of consumers, regardless of how it gets there, it helps small businesses,” said Keith Hall, president of the National Association for the Self-Employed, noting that Main Street businesses, such as salons beauty, likely benefit.
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Congress added more than $ 7 billion to the $ 800 billion allocated to the last round of the PPP, which started on January 11. The Small Business Administration has approved about $ 680 billion in loans so far during this round, and a total of $ 1.2 trillion since April.
But small business advocates are concerned that the bill has not extended the program, which is scheduled to end on March 31. Congress can still extend the PPP – it has already approved extensions after two previous rounds of financing have ended – but Karen Kerrigan, president of Small The Business and Entrepreneurship Council considered the bill “a missed opportunity” for improvements in pandemic relief small businesses.
Kerrigan was also concerned that lawmakers did not raise the $ 150,000 limit on SBA economic disaster loans that many companies sought during the virus outbreak.
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The account also includes $ 100 million for Small Business Development Centers sponsored by the SBA and other organizations that offer free counseling and education for small businesses. It also contains $ 10 billion for the state’s Small Business Credit Initiative, a program that aims to help states support small business loans.
Kerrigan was optimistic that the project would have a positive effect on the economy and, in turn, on small businesses.
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“We anticipate an overall uplift that will help fuel the momentum and confidence that is growing on Main Street,” she said. But she warned that, instead of spending their stimulus payments, many individuals and families will use the money to save or pay debts.
“Therefore, small businesses must continue to compete fiercely for the available consumer dollars,” she said.