On Thursday afternoon, President Biden signed the American Rescue Plan into action, sending out $1.9 trillion in relief and economic stimulus for those affected by the coronavirus.
Few industries have been impacted more by the lockdowns of the past year than restaurants, which is why this package includes $28.6 billion dollars in relief for small, independent restaurants. This Restaurant Revitalization Fund will provide direct grant access for restaurants hit hardest by the pandemic crisis.
Restaurants also stand to benefit from the individual relief checks of $1,400 for those with income under $75,000, as these checks have led to more consumer economic behavior as we saw in the last round of checks.
You can find the application here, and here's some more information about when you can apply, but before you go, here’s what you, as a small restaurant owner, need to know about this relief package and how to apply.
Learn more about growing your restaurant concept with Honeycomb Credit's The Ultimate Guide to Growing Your Restaurant in 2021!
Who’s eligible for the American Rescue Plan’s restaurant relief?
Any food service or drinking establishments, such as a private restaurant, bar, brewery, taproom or food truck, is eligible for the restaurant grants of the relief package.
In the first 60 days, $5 billion will be set aside specifically for small businesses grossing less than $500,000 to give smaller businesses an opportunity to secure grant funding.
Furthermore, for the first 21 days, disadvantaged small businesses will be given extra priority, including those owned by women, veterans, and groups that are otherwise economically or socially disadvantaged, as defined by SBA codes.
Publicly traded companies, non-profits, and restaurants with more than 20 locations are not eligible to apply. You also cannot have an existing application for the Save Our Stages program, and there are limitations for private equity funds. You cannot have received a Shuttered Venues Operators grant to be eligible. Businesses operated by state or local governments are also not eligible.
How much relief can I get from the Restaurant Revitalization Fund?
The relief package will be calculated based on how established your restaurant is as a business, the amount of revenue you generated in 2019 and 2020. Grants will be capped at $10 million for restaurant groups and $5 million for individual venues.
Here’s how the Independent Restaurant Coalition puts it:
As noted in the calculations, if your restaurant has received a Paycheck Protection Program (PPP) loan in the past year, that will be deducted from your potential grant amount.
If your restaurant is permanently closed, unfortunately, you're ineligible for this program. However, your options aren't out! See if the Honeycomb Comeback Loan program is right for you.
How can I use the money from the Restaurant Revitalization Fund?
The money can be used for paying all kinds of costs that have accrued since the pandemic: mortgages, back rent, utilities, payroll, food, supplies, operational expenses, costs as covered in the requirements for the PPP loans.
The grants can be used alongside other funding sources like PPP, EIDL, and the Employee Retention Tax Credit.
This package is eligible for all expenses incurred between 2/15/2020 and the end of 2021. The funds from this program must be used up by the end of this year.
These grants will not be considered taxable income by the IRS.
How do I apply for the Restaurant Revitalization Fund?
Applications for the Restaurant Revitalization Fund will be facilitated by the SBA.
You still have a few days to get your material to apply, as applications should be going up on March 15th. Contrary to earlier reports, you will NO LONGER need a DUNS number or be registered with SAM.
Here’s what you can do immediately to prepare for your application:
Have your Employee Identification Number (EIN) ready to go when applying.
The Small Business Administration will be processing these applications. Their current list of coronavirus relief options gives you more detailed information on eligibility and application processes.
Get your information in order by using this sample application form.
If your restaurant is eligible, you should plan to apply for the program as soon as the application opens, so utilize that sample application to make sure you have everything you need! There is no guarantee that the program will refill once the $28.5B is used up.
What other restaurant funding options do I have?
It is important to note that the money set aside for restaurants won’t be nearly enough for all the restaurants that are struggling right now. Between April of 2019 and April of 2020, there’s a $33 billion revenue gap! However, if you can’t secure one of these grants, you aren’t out of luck.
Honeycomb Credit has been offering loans to restaurants and other small businesses affected by the pandemic, sourced through crowdfunding. Our unique crowd-investing platforms allow your customers to help out your business while receiving a return on their contribution, deepening your relationship with them.
One bar that was able to bounce back from lockdown devastation thanks to a successful Honeycomb campaign was Valley Tavern, a bar in San Francisco. After raising a total of almost $90,000, Valley Tavern was able to re-open and install a kitchen to be able to operate throughout lockdown restrictions.
Keep Your Restaurant Serving Your Community
Your restaurant has proven to be resilient, getting through one of the toughest times in recent history, and now is your chance to keep it going.
A Honeycomb Credit loan can be used alongside grants from the Restaurant Revitalization Fund, getting you the funds you need to stay afloat or steadily come out of the pandemic while also strengthening your relationship with your customers. Find out more at www.honeycombcredit.com/restaurant
For more information about how you can supplement this grant (or substitute for it if you're ineligible), sign up below:
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