Updates to the Restaurant Revitalization Fund
Nearly 1 year ago, the Restaurant Revitalization Fund (RFF) stopped taking applications. As a recap, the Restaurant Revitalization Fund was created to give restaurants and other hospitality-related businesses the financial assistance that they need to get through this world-wide pandemic. To ensure all types of restaurant owners receive funding, including smaller establishments and minority-owned businesses, funding allocations were created for these applicants. The intention behind the RFF was good, but there were snags. To date, 177,000 restaurants applied and were approved for this financial assistance but didn’t get any funding—that’s about 20 percent of U.S. restaurants according to the National Restaurant Association. In fact, just one-third of the applicants actually got funding.
To solve this, congress needed to take action. So on April 7, 2022, the House of Representatives voted to advance a bill to offer $42 billion to foodservice businesses that missed out on getting the funds they were approved for through the RRF. The bill also proposes $13 billion to other businesses that are struggling during the pandemic, like gyms and concert venues. What’s it called? The Relief for Restaurants and Other Hard Hit Small Businesses Act of 2022 (H.R. 3807) – quite the mouthful! Passage in the House was cause for celebration, and now the bill will head to the Senate.
There are many fears from industry leaders that without the passage of this relief bill, they could be in dire straits. The National Restaurant Association provided some key statistics to back-up their support for the bill’s passage in the Senate. Their research found that over 40 percent of restaurant owners/operators expect business conditions to worsen over the upcoming months, the bleakest outlook in almost 24 months. Additionally, 90,000 restaurants had to shut their doors permanently or long-term thanks to the pandemic. These funds could have a significant positive impact on an otherwise battered industry. Interestingly enough, this bill will be partly funded by “all funds recovered, seized, reclaimed, or otherwise returned” from unused funds from other pandemic relief programs. There were even some bad actors who stole relief funds meant for small businesses—that reclaimed money will also go toward funding this bill.
We’ll continue to keep you posted on the latest updates to the Restaurant Revitalization Fund and its journey through the Senate. And as usual, we’ll keep providing you with the most current insights and noteworthy topics relevant to your business. Check back with the Financial Pantry each week, your single source for all-things-small-business. From day-to-day business operations and employee management, to business financing and more, ARF Financial has you covered.