Association advocacy nets dedicated dollars for restaurants

$1.9 trillion pandemic aid package contains $28.6 billion in direct aid to restaurants.

The targeted aid resulted in part from the Association’s argument that the restaurant industry—the country’s second largest private sector employer next to health care—has lost more jobs and revenue than any other industry.

The restaurant industry is one of the biggest beneficiaries of the most recent round of relief from the COVID-19 pandemic. The nearly $2 trillion American Rescue Plan Act signed into law by President Biden on March 11, contains $28.6 billion in direct aid to restaurants.

Aid from the Revitalization Fund takes the form of grants of up to $5 million per restaurant, or up to $10 million for multiple-unit operations. Eligibility and dollar amount of the grants are based on the difference between restaurants’ 2020 sales and 2019 revenue to help compensate for what they lost during full and/or partial shut-downs. About 20% of the fund is earmarked for smaller restaurants with sales of less than $500,000 in 2019.

Restaurants were among the few industries that will receive targeted benefits under the bill, due in large part to the year-long effort by the National Restaurant Association, its state restaurant association partners, members, and the strength of their combined grassroots network to provide relief to the restaurant industry.

The targeted aid resulted in part from the Association’s argument that the restaurant industry—the country’s second largest private employer next to health care—has lost more jobs and revenue than any other industry.

“We were the first industry to be shut down, we’ll be the last to reopen, and we have a very long road to recovery in front of us,” said Sean Kennedy, Association executive vice president, Public Affairs. Losses, he said, are estimated at close to $255 billion, putting between 100,000 and 110,000 restaurants out of business due to the pandemic.

While the targeted aid will be immensely helpful in covering some of the industry’s pandemic-related losses in revenue and will put many restaurants back on the road to a healthy recovery, the Association secured a number of other victories for restaurants in the legislation.

In addition to the higher loan limits the Association pushed for restaurants to receive in the first and second rounds of the Payroll Protection Program (PPP) last year, results of other successful advocacy efforts contained in the American Rescue Plan Act include:

• Expansion of the Employee Retention Tax Credit for restaurants that keep employees on the payroll;
• Defeat of a federal minimum wage increase that many Democrats wanted in the bill; and
• Retention of the tipped minimum wage.